Cognitive Bias

May 31st, 2022

Cognitive biases are mental short-cuts and some of the most mind-boggling phenomena in psychology.

Their nature is one of the reasons why each one of us is stuck in his/her own reality. Knowing your biases could help you get unstuck and make better decisions.

Let's dive in! 🤿

Biases can stem from the brain's preference for lower energy expenditure, missing information and evolutionary pressures. While they enable quick decisions, they also introduce a flurry of errors, clouding our judgement. 🧠

1. Dunning-Kruger effect

You may underestimate your expertise in a field you naturally excel at because you think anyone must be good at it, or overestimate your knowledge when in fact you know little about a subject.

Antidote: Ask your peers about your superpower.

2. Confirmation bias

We tend to value information confirming our own beliefs more than information contradicting them. It takes conscious effort to take new evidence into consideration and to tolerate the uneasy feeling of cognitive dissonance.

3. Gambler's fallacy

Let's say a gambler plays coin flipping – he sees “heads” 9 times in a row and decides “tails” is long overdue. He goes all in.

Unfortunately, the odds did not change based on past results. They are statistically independent.

Heads!

4. Barnum effect

What do psychics and salesmen have in common?

They employ statements vague enough to trick you into believing they are specifically tailored to you.

Example:

“At times you have serious doubts whether you have made the right decision or done the right thing.”

5. The sunk cost fallacy

You buy a used car.

A week later, it breaks down. You pay the repair shop to fix it. Days later, you need to get the brakes fixed. And a door. The repairs cost you more than the car.

You know you should sell it at a loss, but you keep throwing cash at it.

6. Halo effect

I make my friends mad each time I shrug off @elonmusk's bad decisions and Ambien-fueled tweets because I admire his ingenuity and First Principles thinking in @lexfridman's podcasts.

Maybe I'm just prone to the halo effect?

Another good example is the neurosurgeon, whose perceived amazing abilities in the field of medicine seemingly spill over into other domains, like politics:
Chances are he has no clue about political affairs, but you are more likely to take his takes serious because of the halo effect.

7. Planning fallacy

I totally underestimated the time it would take to create this thread, though it was a rewarding experience.

It turns out I'm in good company: Scientists found out most humans are way too optimistic when it comes to setting realistic deadlines for tasks. This is especially true the more complex a task gets.