Hello.

Hello.
In this section, we're going to talk about
irrationality.
There's a little story that a father calls
his son and says, son, after 30 years of
marriage, your mother and I just decided
to get divorced.
And the son he say, well this is terrible.
This is awful.
I really don't want you to do it.
The, the son says, you know what?
I'll come home.
Just, just don't do it yet.
Let's talk about it.
He says, you know what?
I'll call my sister.
We'll be there the day after tomorrow.
Just don't do anything until we have a
discussion with you and Mom.
And the father said, you know what?
I promise you.
We'll wait.
We'll see you the day after tomorrow, and
then we'll have a discussion.
He puts down the phone.
He turns to his wife.
And he says, darling, this year the kids
are going to come home for the holidays,
and they're paying for their own flight
tickets[MUSIC].
So when we think about irrationality, what
is it about?
It's about the forces that drive our
behavior.
Some it are economic forces and some if it
are social forces.
And in this particular section we are
going to look at all kinds of influences
on our behavior.
We're also going to look at choice
architecture.
We're going to look at how the world
around us and how it's structured.
Changes how we view things and how we make
decisions.
We're going to look at how initial
decisions are going to have long-term
influence on us, and finally we're going
to think about what we could do to do
things better.
What can we do to try to overcome some of
our irrational tendencies.
I would like to argue, that when we think
about irrational behavior.
This is something that is important, both
for our personal life, as well as our
social life.
And as well as for our work life and, of
course, for policy.
And to get us started thinking about it, I
would like to tell you my own eh, personal
case and how I became interested in.
When and under what conditions we behave
irrationally.
So as you can probably tell I was badly
injured many years ago.
I was burned on about 70% of my body and I
spent about three years in hospital.
And hospitals give, gives everybody,
everybody who spends time there many
opportunities to examine and think about
irrational behaviors.
And in my particular case there were lots
of examples.
But the thing that focused all my
attention, the thing that kind of eh, made
me think every day was the question of
bandage removal.
So consider the following question.
Imagine you were, like me, burned in 70%
of your body and you were covered with
bandages, and every day the nurses had to
remove your bandages.
And ask yourself what is the right way to
remove these bandages?
And we can think about two very distinct
strategies.
One is to rip the bandages off, quickly as
possible, one after the other, minimizing
the duration of the treatment but making
each second of it incredibly painful.
The second approach is to rip the bandages
off slowly.
Take a long time but make each second less
painful.
Consider to yourself, which one of those
strategies would you pick?
Which one?
When I talk to people about this most
people say they would prefer the ripping
approach, and that's actually the approach
my nurses liked as well.
I always, by the way, thought that the
reason they had this intuition that this
is a better approach is because that's how
they use to wax their legs.
Kind of in the ripping version.
But, removing hair is not the same as
removing bandages necessarily.
So, which one is the right approach?
As a patient, I used to feel that they
were not doing the right thing.
I used to argue with them and plead with
them and say, please, take more time, make
it slower, don't take, don't rip the
bandages as fast, but the nurses told me
two things.
The first they, they said was that they
were right.
They knew what is the best thing to do,
what would minimize my pain, right?
In some sense, they said, who are you, the
patient, to question our eh, judgement as
professionals.
And the second thing they said was that
the word patient doesn't mean to butt in,
or intervene, or make suggestions.
It means to be passive and just sit there
eh, patiently.
In fact this was in Israel where I grew
up, but the word patient has this passive
component in any language I've seen so
far.
So the nurses kept on doing what they
thought was the best thing to do which was
to rip the bandages off quickly, and I
kept on complaining, and we kept on these
roles for quite a long time.
About three years later when I left the
hospital, I started studying at the
university, and one of the first
interesting lessons I learned was about
the power of the experimental method.
And what I particularly found interesting
is the idea that if you have a question,
about almost anything in life, you can
posit to an experiment.
You can say here is one version, here's
another version.
Let's see which one wins.
So I decided to try this out.
Now if you think about it, this question
about how people aggregate information
over time is very general.
Imagine that you have an axis.
You have time, and you have intensity, and
you have experience that can vary in
intensity in all kinds of ways.
You can have movies.
What could happen if we had a movie and we
had really good 5 minutes.
Are they better off in the beginning, the
middle or the end?
What if we can take an opera or a concert
and make it 10% longer or half an hour
longer, are we making it better by how
much?
So these questions of how people take an
experience vary over time, and aggregate
information is actually quite general.
But for me, the main issue was pain.
I wanted to understand how this works in
the domain of pain.
So initially, I didn't have much money for
research, so I went to a hardware store
and I bought a carpenter's vise, basically
something like this.
And I set up this carpenter's vise in the
lab, and I invited people to come into the
lab and put two fingers in this device and
I would crunch people's fingers a little
bit.
And I would crunch their fingers a little
bit for long durations and short
durations, high intensity and low
intensity.
Pain that goes up, pain that goes down, up
and down, down and up, all kinds of
versions of pain.
And after each of those painful experience
I would ask people and how painful was
that, and how painful was that.
This is kind of just rating scale from not
painful at all to the most painful I can
imagine.
And then we ask people to make choices,
which one of the last 2 experiences would
you last to repeat, would you like to
repeat again, the last one or the one just
before it?
And people gave me their choices and their
ratings, and I were trying to infer how
people combine these experiences.
And I finished the first paper, I learned
some lessons, I published these in
academic journal.
And then good things happened, I got more
money for research, so I moved to better
equipment.
I move to something like this which are a
mechanism to create annoying sound, in
different intensities.
I did experiments with electrical shocks
over time.
I even created a pain suit.
I created a suit with 300 feet of hoses
stitched thorough it.
And with this suit, I could get people to
be very hot and very cold, and then I
could relieve that pain in many different
ways.
And what did I learn from all of those
experiences and all of those experiments?
I learned that the nurses got things wrong
in multiple ways.
First of all in the terms of the question
of duration versus intensity, it turns out
that if you take an experience and make it
twice as long, you don't make it twice as
painful.
So the nurses were trying to minimize the
duration, but they were not doing the
right thing.
On the other hand, when you play with the
intensity, you make something more
intense.
Now you're really changing how people
experience it.
So what the nurses were doing, they were
trying to minimize the duration at the
cost of the intensity, but by doing so
they were not saving me much, but they
were making it much more painful.
And not just for me, by the way, for all
the other patients.
The second thing the nurses failed to
understand was that progression over time
matters a great deal.
When you start with the low pain, and you
increase pain over time, this is much,
much worse than starting with the high
pain and going down over time, and mostly
for reason of convenience.
The nurses started at my legs, and ended
up in my face, which gave me the wrong
progression of pain over time.
And, finally it turns out that for really
long periods of pain it's good to give
people a period to kind of recover
recuperate and prepare themselves for the
next period of pain.
And, again this was something that the
nurse did not.
Get.
Now when I finished doing these
experiments about pain and pain
perception, aggregation of pain, I went
back and I talked to the nurses.
All kinds of things have changed since
then, but the thing that puzzled me the
most was how could the nurses get it
wrong.
Here were kind people, wonderful people
who were spending hours in terrible
conditions to serve their patients.
And they were not saying, you know, I
don't know which is the right way.
They were convinced that the right thing
to do was actually the thing that was
wrong.
It's not as if they say, I just don't know
what the right answer is.
No they actually had a strong conviction
that they knew waht the right answer is,
but that was not the right one.
And then of course the quesion is are
nurses the only people who have the wrong
intuition.
Are nurses the only people that says this
is what I think is the right answer when
in fact it's the wrong answer.
And from that point of view, and from that
starting point, I started looking at all
kinds of behaviors, all kinds of things in
which we have good intuitions, we have
good intentions, we trust our intuitions
but in fact, our intuitions are misleading
us time after time.
And this is for me kind of the starting
point of irrational behavior, things that
we think we know how they work, we think
we know what's the right thing to do, but
in fact we're wrong.
So let's think about some of this.
Now to get you an intuitive example of how
these things work, without inviting you to
the lab and to eh, squish your fingers.
I want us to think a little bit about
visual illusions.
So consider the following illusions.
You have two Towers of Pisa here, one on
the right and one on the left.
And now think to yourself, which one leans
more to the right?
If you're like everybody else on the
planet, you think that the one on the
right is leaning more.
But what about the following thing?
Now, again, if I asked you the same
question, again you would think the one on
the right is the one leaning more to the
right.
Now of course they'll just switched in
front of you and you know this is a visual
illusion.
Now what's interesting about visual
illusions is that everybody gets it wrong.
It doesn't matter how old you are, how
young you are, it doesn't matter how much
experience you have in vision, as long as
you can see you will get it wrong.
Here's another visual illusion, this is
one of my favorite all-time visual
illusions.
Look at this cube, the top arrow, to what
color is it pointing?
You probably think it's about brown.
What about the bottom one?
Well, looks orangish.
Turns out they are identical.
Can any of you see them as identical?
Of course not.
Now what happens if I cover the cube up?
Now you can see that both of those patches
are actually identical, and by the way
there's no trick to it, these are really
identical.
And here's the other interesting thing,
now the illusion pops right back.
Knowing that those two things are actually
the same doesn't help you in any way to
see them as identical.
Now there's something else interesting in
this illusion, which we'll come back to
later, which is that this illusion is all
about the way that the brain uses
relativity.
Many times what you think to yourself
you're doing, is you're comparing the top
patch to the bottom patch, but that's
actually not what your visual system is
doing.
What the visual system is doing is
comparing the top patch to its immediate
environment and the bottom patch to it's
immediate environment, and because of that
you get this illusion.
You think to yourself that you can compare
both patches correctly, but you can't.
When we come back to it you'll see how it
comes about this illusion in all kinds of
other areas of life, including pricing,
for example, and how we're using
background context to evaluate and think
differently about what we're comparing.
There's one more type of illusion I want
to eh, share with you, and I'm going to
show you a couple of examples of those.
And it's a different kind of illusion
because it only works once, so pay
attention.
So in the next clip, what you're going to
see is a group of people holding iPads,
and they're going to move the iPads, and
the iPads are going to change colors.
And your task is to count how many times
they change into the color red.
Every time something change from one color
to red to something else, you count it and
then another iPad changes to red, you
count it.
And your task is to count how many times
all the iPads Across the whole clip,
change into red colors.
Now, don't get too technical, if something
looks almost like red or slightly pinkish,
it's okay, count it as red.
Okay?
So, before we go though, I do want to say
a couple of things.
First of all, it turns out that there's a
lot of research about it, showing that
people who do well on this task, people
who count well on this task, do well in
terms of their love life.
They have better, better romantic life.
And the second thing is the people who do
well on these tasks, live longer.
So if I were you, I'm just saying, if I
were you I would focus, I would count well
because remember what's on the line here
is your romantic future and your
longevity.
So count carefully how many times the
people, how many times the people, the
iPads are switching into red color.
Ready.
Set.
Go.
[music] So how many did you count?
Count 50, 60, 70, 40, 20?
How many?
The real number is 62 but the reality is
that, that doesn't matter so much.
The reason I really asked you this
question was not to ask you how many times
the iPads are flashing red, but to ask you
a slightly different question which is,
did you notice, me in a particular bee
suit, hovering around the scene?
Did you notice me at all, or not?
Let's look at it again.
And this time try to pay careful
attention, not to the iPads, but to the
total scene, and let's see if this time
you can see me floating around.
[music] And just to be clear, this is the
same exact clip.
And if you don't believe me, luckily you
have the video.
Go back and you can look at the first clip
again just to prove it to yourself beyond
a shadow of a doubt.
[music] I hope, that like me, you find
this quite startling.
You look at a small part of the screen.
You focus, you look very carefully, and
nevertheless something unexpected happens
around the screen, and you're able to
ignore it.
It's a tremendous ability of human,
capacity and the reason for that by the
way, is that we don't see with our eyes.
We see with our brains.
Our brains expected to see a particular
pattern and that's what we end up seeing.
Now we think we see with our eyes.
We think that we observe all the
information, but we don't.
And just as another example of that, do
you remember what shirt I was wearing
before we started this clip?
Well, you can go back and check for
yourself, but I have a different hair cut,
slightly different shave, actually very
different shave.
Well, slightly different shave, and a
different shirt.
And I bet you didn't notice those changes
either.
I hope you agree with me that it's really
kind of amazing to see how much we don't
pay attention.
You know, we usually think that we see
with our eyes, but the reality is, we see
with our brains.
And our brains fill in the information in
the way that we expect to see it, not
necessarily what it is out there,
actually, but what we expect to see.
Now why do I start with talking about
decision making irrational behavior, by
talking about visual illusions?
I think visual illusions are a great
metaphor that help us to think about human
thinking.
Think about it.
We have a huge part of our brain dedicated
to vision.
We have a huge part here in the back
dedicated to vision, does vision all the
time, bigger part of the brain that is
dedicated to anything else.
We do vision many hours of the day.
We've evolutionary design to do vision.
If you had to pick one thing that people
are good at, it's vision.
And nevertheless we have these mistakes.
You'll always see the Pisa illusion,
you'll always see the cube illusion.
And the question we should ask ourselves,
if with all these benefits, huge
mechanism, lot of experience, evolutionary
reasons to do it, with all of those
reasons to do vision well, we still have
predictable systematic mistakes in vision,
what are the odds that we don't have even
more mistakes in other areas of our lives?
What happened to decisions about health
care?
Decisions about money?
Those are areas where we don't have a
particular brain mechanism, we don't have
that much experience.
Evolutionary these are much newer things.
Couldn't it be that in those areas we
would have even more predictable and
systematic mistakes that everybody shares?
And for the rest of the discussion I want
to present to you the case that this is
indeed, this is indeed so.