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Present bias shows up not just in experiments, of course, but in the real world. Especially in the United States, people egregiously undersave for retirement—even when they make enough money to not spend their whole paycheck on expenses, and even when they work for a company that will kick in additional funds to retirement plans when they contribute.

hen people hear the word bias, many if not most will think of either racial prejudice or news organizations that slant their coverage to favor one political position over another. Present bias, by contrast, is an example of cognitive bias—the collection of faulty ways of thinking that is apparently hardwired into the human brain. The collection is large. Wikipedia’s “List of cognitive biases” contains 185 entries, from actor-observer bias (“the tendency for explanations of other individuals’ behaviors to overemphasize the influence of their personality and underemphasize the influence of their situation … and for explanations of one’s own behaviors to do the opposite”) to the Zeigarnik effect (“uncompleted or interrupted tasks are remembered better than completed ones”)

If I had to single out a particular bias as the most pervasive and damaging, it would probably be confirmation bias. That’s the effect that leads us to look for evidence confirming what we already think or suspect, to view facts and ideas we encounter as further confirmation, and to discount or ignore any piece of evidence that seems to support an alternate view

Most hiring decisions come down to a gut decision. According to Nobel laureate Daniel Kahneman, however, this process is extremely flawed and there's a much better way.

Kahneman asked interviewers to put aside personal judgments and limit interviews to a series of factual questions meant to generate a score on six separate personality traits. A few months later, it became clear that Kahneman's systematic approach was a vast improvement over gut decisions. It was so effective that the army would use his exact method for decades to come. Why you should care is because this superior method can be copied by any organization — and really, by anyone facing a hard decision.

First, select a few traits that are prerequisites for success in this position (technical proficiency, engaging personality, reliability, and so on. Don't overdo it — six dimensions is a good number. The traits you choose should be as independent as possible from each other, and you should feel that you can assess them reliably by asking a few factual questions. Next, make a list of those questions for each trait and think about how you will score it, say on a 1-5 scale. You should have an idea of what you will call "very weak" or "very strong."

Before Kahneman and Tversky, people who thought about social problems and human behavior tended to assume that we are mostly rational agents. They assumed that people have control over the most important parts of their own thinking. They assumed that people are basically sensible utility-maximizers and that when they depart from reason it’s because some passion like fear or love has distorted their judgment.

Kahneman and Tversky conducted experiments. They proved that actual human behavior often deviates from the old models and that the flaws are not just in the passions but in the machinery of cognition. They demonstrated that people rely on unconscious biases and rules of thumb to navigate the world, for good and ill. Many of these biases have become famous: priming, framing, loss-aversion.

We are dual process thinkers. We have two interrelated systems running in our heads. One is slow, deliberate and arduous (our conscious reasoning). The other is fast, associative, automatic and supple (our unconscious pattern recognition). There is now a complex debate over the relative strengths and weaknesses of these two systems. In popular terms, think of it as the debate between “Moneyball” (look at the data) and “Blink” (go with your intuition).

Can our healthy selves predict how we will feel in unhealthy circumstances with enough certainty to choose whether we would want to live or die? Can our present selves, in general, make reliable choices for our futures selves? How good are our decisions anyway, and how do we make them?

The "focusing illusion," according to Mr. Kahneman, happens when we call up a specific attribute of a thing or experience (e.g., climate) and use it to answer a broader and more difficult question (what makes life enjoyable, in California or anywhere else?).

One major effect of the work of Messrs. Kahneman and Tversky has been to overturn the assumption that human beings are rational decision-makers who weigh all the relevant factors logically before making choices. When the two men began their research, it was understood that, as a finite device with finite time, the brain had trouble calculating the costs and benefits of every possible course of action and that, separately, it was not very good at applying rules of logical inference to abstract situations. What Messrs. Kahneman and Tversky showed went far beyond this, however. They argued that, even when we have all the information that we need to arrive at a correct decision, and even when the logic is simple, we often get it drastically wrong.

It’s impossible to overstate the influence of Kahneman and Tversky. Like Darwin, they helped to dismantle a longstanding myth of human exceptionalism. Although we’d always seen ourselves as rational creatures—this was our Promethean gift—it turns out that human reason is rather feeble, easily overwhelmed by ancient instincts and lazy biases. The mind is a deeply flawed machine.

there is a subtle optimism lurking in all of Kahneman’s work: it is the hope that self-awareness is a form of salvation, that if we know about our mental mistakes, we can avoid them. One day, we will learn to equally weigh losses and gains; science can help us escape from the cycle of human error. As Kahneman and Tversky noted in the final sentence of their classic 1974 paper, “A better understanding of these heuristics and of the biases to which they lead could improve judgments and decisions in situations of uncertainty.” Unfortunately, such hopes appear to be unfounded. Self-knowledge isn’t a cure for irrationality; even when we know why we stumble, we still find a way to fall.

self-knowledge is surprisingly useless. Teaching people about the hazards of multitasking doesn’t lead to less texting in the car; learning about the weakness of the will doesn’t increase the success of diets; knowing that most people are overconfident about the future doesn’t make us more realistic. The problem isn’t that we’re stupid—it’s that we’re so damn stubborn

In Teaford’s case, the scouting evaluation was predisposed to a mental shortcut called the representativeness heuristic, which was first defined by the psychologists Daniel Kahneman and Amos Tversky. In such cases, an assessment is heavily influenced by what is believed to be the standard or the ideal.

Kahneman, a professor emeritus at Princeton University and a winner of the Nobel Prize in economics in 2002, later wrote “Thinking, Fast and Slow,” a book that has become essential among many of baseball’s front offices and coaching staffs.

“Pretty much wherever I go, I’m bothering people, ‘Have you read this?’” said Mejdal, now an assistant general manager with the Baltimore Orioles.

rather than stating the optimal, rational answer, as an economist of the time might have, they quantified how most real people, consistently, make a less-rational choice. Their work treated economics not as a perfect or self-correcting machine, but as a system prey to quirks of human perception. The field of behavioral economics was born.

Tversky and calls for a new form of academic cooperation, marked not by turf battles but by "adversarial collaboration," a good-faith effort by unlike minds to conduct joint research, critiquing each other in the service of an ideal of truth to which both can contribute.

Human brains take shortcuts in making decisions. Finding where those shortcuts lead us to dumb places is what his life work has been all about. Artificial intelligences, say, Google, also have to take shortcuts, but they are *not* the same ones that our brains use. So, when an AI ends up in a weird place by taking a shortcut, that bias strikes us as uncannily weird. Get ready, too, because AI bias is going to start replacing human cognitive bias more and more regularly.

While philosophers, economists, and social scientists had assumed for centuries that human beings are rational agents—reason was our Promethean gift—Kahneman, the late Amos Tversky, and others, including Shane Frederick (who developed the bat-and-ball question), demonstrated that we’re not nearly as rational as we like to believe.

When people face an uncertain situation, they don’t carefully evaluate the information or look up relevant statistics. Instead, their decisions depend on a long list of mental shortcuts, which often lead them to make foolish decisions.

in many instances, smarter people are more vulnerable to these thinking errors. Although we assume that intelligence is a buffer against bias—that’s why those with higher S.A.T. scores think they are less prone to these universal thinking mistakes—it can actually be a subtle curse.

Mr. Price surprised his 120-person staff by announcing that he planned over the next three years to raise the salary of even the lowest-paid clerk, customer service representative and salesman to a minimum of $70,000.

Mr. Price, who started the Seattle-based credit-card payment processing firm in 2004 at the age of 19, said he would pay for the wage increases by cutting his own salary from nearly $1 million to $70,000 and using 75 to 80 percent of the company’s anticipated $2.2 million in profit this year.

his unusual proposal does speak to an economic issue that has captured national attention: The disparity between the soaring pay of chief executives and that of their employees.

Expert judges and amateurs alike claim to judge classical musicians based on sound. But Tsay’s research suggests that the original judges, despite their experience and expertise, judged the competition (which they heard and watched live) based on visual information, just as amateurs do.

just like with classical music, we do not appraise wine in the way that we expect. 

Priceonomics revisited this seemingly damning research: the lack of correlation between wine enjoyment and price in blind tastings, the oenology students tricked by red food dye into describing a white wine like a red, a distribution of medals at tastings equivalent to what one would expect from pure chance, the grand crus described like cheap wines and vice-versa when the bottles are switched.

Human decision-making shows systematic simplifications and deviations from the tenets of rationality (‘heuristics’) that may lead to suboptimal decisional outcomes (‘cognitive biases’). There are currently three prevailing theoretical perspectives on the origin of heuristics and cognitive biases: a cognitive-psychological, an ecological and an evolutionary perspective. However, these perspectives are mainly descriptive and none of them provides an overall explanatory framework for

the underlying mechanisms of cognitive biases. To enhance our understanding of cognitive heuristics and biases we propose a neural network framework for cognitive biases, which explains why our brain systematically tends to default to heuristic (‘Type 1’) decision making. We argue that many cognitive biases arise from intrinsic brain mechanisms that are fundamental for the working of biological neural networks. To substantiate our viewpoint, we discern and explain four basic neural network principles: (1) Association, (2) Compatibility, (3) Retainment, and (4) Focus. These principles are inherent to (all) neural networks which were originally optimized to perform concrete biological, perceptual, and motor functions. They form the basis for our inclinations to associate and combine (unrelated) information, to prioritize information that is compatible with our present state (such as knowledge, opinions, and expectations), to retain given information that sometimes could better be ignored, and to focus on dominant information while ignoring relevant information that is not directly activated. The supposed mechanisms are complementary and not mutually exclusive. For different cognitive biases they may all contribute in varying degrees to distortion of information. The present viewpoint not only complements the earlier three viewpoints, but also provides a unifying and binding framework for many cognitive bias phenomena.

The cognitive-psychological (or heuristics and biases) perspective (Evans, 2008; Kahneman and Klein, 2009) attributes cognitive biases to limitations in the available data and in the human information processing capacity (Simon, 1955; Broadbent, 1958; Kahneman, 1973, 2003; Norman and Bobrow, 1975)

When it comes to making decisions that involve risks, we humans can be irrational in quite systematic ways — a fact that the psychologists Amos Tversky and Daniel Kahneman famously demonstrated with the help of a hypothetical situation, eerily apropos of today’s coronavirus epidemic, that has come to be known as the Asian disease problem.

This is irrational because the two questions don’t differ mathematically. In both cases, choosing the first option means accepting the certainty that 200 people live, and choosing the second means embracing a one-third chance that all could be saved with an accompanying two-thirds chance that all will die. Yet in our minds, Professors Tversky and Kahneman explained, losses loom larger than gains, and so when the options are framed in terms of deaths rather than cures, we’ll accept more risks to try to avoid deaths.

Our decision making is bad enough when the disease is hypothetical. But when the disease is real — when we see actual death tolls climbing daily, as we do with the coronavirus — another factor besides our sensitivity to losses comes into play: fear.

I never said that reason plays no role in judgment. Rather, I urged that we be realistic about reasoning and recognize that reasons persuade others on moral and political issues only under very special circumstances.

two basic kinds of cognitive events are “seeing-that” and “reasoning-why.” (These terms correspond roughly to what the psychologist Daniel Kahneman and others call “System 1” and “System 2” and that I call the “elephant” and the “rider.”)

We effortlessly and intuitively “see that” something is true, and then we work to find justifications, or “reasons why,” which we can give to others.  Both processes are crucial for understanding belief and persuasion. Both are needed for the kind of democratic deliberation that Lynch (and I) want to promote.

In 2008, Nate Silver correctly predicted the results of all 35 Senate races and the presidential results in 49 out of 50 states. Since then, his website, fivethirtyeight.com (now central to The New York Times’s political coverage), has become an essential source of rigorous, objective analysis of voter surveys to predict the Electoral College outcome of presidential campaigns. 

Political junkies, activists, strategists, and journalists will gain a deeper and more sobering sense of Silver’s methods in The Signal and the Noise: Why So Many Predictions Fail—But Some Don’t (Penguin Press). A brilliant analysis of forecasting in finance, geology, politics, sports, weather, and other domains, Silver’s book is also an original fusion of cognitive psychology and modern statistical theory.

Its most important message is that the first step toward improving our predictions is learning how to live with uncertainty.

the social psychologist Sheena Iyengar asked 100 American and Japanese college students to take a piece of paper. On one side, she had them write down the decisions in life they would like to make for themselves. On the other, they wrote the decisions they would like to pass on to others.

The Americans desired choice in four times more domains than the Japanese.

Americans now have more choices over more things than any other culture in human history. We can choose between a broader array of foods, media sources, lifestyles and identities. We have more freedom to live out our own sexual identities and more religious and nonreligious options to express our spiritual natures.

It’s the invasion of the Can’t-Help-Yourself books. Unlike most pop self-help books, these are about life as we know it — the one you can change, but only a little, and with a ton of work. Professor Kahneman, who won the Nobel Prize in economic science a decade ago, has synthesized a lifetime’s research in neurobiology, economics and psychology. “Thinking, Fast and Slow” goes to the heart of the matter: How aware are we of the invisible forces of brain chemistry, social cues and temperament that determine how we think and act?

The choices we make in day-to-day life are prompted by impulses lodged deep within the nervous system. Not only are we not masters of our fate; we are captives of biological determinism. Once we enter the portals of the strange neuronal world known as the brain, we discover that — to put the matter plainly — we have no idea what we’re doing.

Mr. Duhigg’s thesis is that we can’t change our habits, we can only acquire new ones. Alcoholics can’t stop drinking through willpower alone: they need to alter behavior — going to A.A. meetings instead of bars, for instance — that triggers the impulse to drink.

the experience of waiting, whether for luggage or groceries, is defined only partly by the objective length of the wait. “Often the psychology of queuing is more important than the statistics of the wait itself,” notes the M.I.T. operations researcher Richard Larson, widely considered to be the world’s foremost expert on lines.

This is also why one finds mirrors next to elevators. The idea was born during the post-World War II boom, when the spread of high-rises led to complaints about elevator delays. The rationale behind the mirrors was similar to the one used at the Houston airport: give people something to occupy their time, and the wait will feel shorter.

Professors Carmon and Kahneman have also found that we are more concerned with how long a line is than how fast it’s moving. Given a choice between a slow-moving short line and a fast-moving long one, we will often opt for the former, even if the waits are identical. (This is why Disney hides the lengths of its lines by wrapping them around buildings and using serpentine queues.)

Between 1971 and 1984, Kahneman and Tversky had published a series of quirky papers exploring the ways human judgment may be distorted when we are making decisions in conditions of uncertainty.