Predictably Irrational

By Dan Ariely

Harper Collins, 2008

In James Brooks’ sharp and funny comedy As Good as It Gets, the neurotic writer Melvin Udall is asked how he writes women so well. He responds, “I think of a man, and I take away reason and accountability.” In his new book Predictably Irrational, Dan Ariely makes the claim that Udall’s formula works perfectly well for both genders, all races, and all age groups.

It’s his contention that, contrary to popular conception, people’s decisions about their money, their lives, their relationships, and their tastes are rooted not in some form of common sense assessment but rather in a little-explored growth of personal superstitions, irrational connections, false assumptions, and whimsy ossified into habit. His worldview explains a great deal about the multiform chaos we see in riotous bloom in every morning’s newspaper, but it nevertheless provokes disbelief, at least initially. Surely, the reader thinks, there are some subjects on which people must be rational, money being foremost among them?

Ariely begs to differ, and he’s explosively, almost comically credentialed. He’s the Alfred P. Sloane Professor of Behavioral Economics at M.I.T.’s Sloane School of Management (all the business majors reading this have now gone into involuntary salaams of veneration, but there are more bona fides still to come), a researcher at the Federal Reserve Bank of Boston, and a Fellow at the Institute for Advance Study at Princeton. In other words, if he claims that human beings are less rational than the average boll-weevil in a cotton field, his claims have to be given some consideration.

His book has a chatty, friendly feel to it – he’s probably a delightful class lecturer. He eschews the professional jargon he could almost certainly hide behind in favor of a much more approachable style, although he has what he considers hard data to report on a wide variety of subjects touching on the irrational behavior humans exhibit every day.

Several times he informs us that he has a “unique” insight into humanity, but a great deal of the material covered in Predictably Irrational – groupthink, the placebo effect, peer pressure, lying, etc. – has been written about for years by others. Ariely wants to take this material and present it in such a way as to help his readers introduce more rationality into their lives: “My goal, by the end of this book,” he writes, “is to help you fundamentally rethink what makes you and the people around you tick.”

His main approach to doing this is to focus on anchors, unpredictable (and often illogical) factors that prompt people to buy one item instead of another. Ariely claims people imprint on these anchors much as goslings do on the first thing they see (his readers are referred to as goslings throughout the book, leaving little doubt who he’d like them to imprint on), that this process has little or nothing to do with the traditionally accepted concepts of supply and demand, and that the whole silly business is almost always ultimately harmful to an individual’s long-term self-interest. Repetition is the key: once “anchored” to a certain choice or behavior, people tend to repeat the process because the repetition itself is comforting. Ariely warns against this repeatedly (ironically enough) throughout his book: “With everything you do, in fact, you should train yourself to question your repeated behaviors.”

All of which is intriguing enough, but the same problem keeps cropping up everywhere in the book, and given the author’s extensive credentials, it’s pretty much the last problem you’d expect: whether it’s the tone he’s adopted for the audience he envisions (business people are, after all, some of the most deeply stupid human beings on the face of the planet, a fact all business books implicitly bow to) or it’s the enthusiasm he so evidently feels getting the better of him, but time and again in Predictably Irrational Ariely comes across as singularly blind to a great many patently obvious things.

At first it might be chalked up to a weakness at understanding literature – a fault certainly not exclusive to the Sloane School of Management. Take Ariely’s evocation of one of the classic scenes of American fiction:

Do you remember the familiar episode in The Adventures of Tom Sawyer, the one in which Tom turns the whitewashing of Aunt Polly’s fence into an exercise in manipulating his friends? As I’m sure you recall, Tom applies the paint with gusto, pretending to enjoy the job. “Do you call this work?” Tom tells his friends. “Does a boy get a chance to whitewash a fence every day?” Armed with this new “information,” his friends discover the joys of whitewashing a fence. Before long, Tom’s friends are not only paying for the privilege, but deriving real pleasure from the task – a win-win outcome if ever there was one.

If Ariely’s readers do recall that famous episode, they’ll surely have a hard time recognizing it in his version. A “win-win” outcome? Sawyers friends are his victims: they’re manipulated into doing something for him and then tricked out of their money by him. If that’s a win-win situation, Ariely should convey this happy news to a few thousand Enron investors. And if he can’t see the point of the Twain episode, how are his readers supposed to rest easy with the assertions he makes on far more convoluted subjects? Over and over in Predictably Irrational, Ariely smilingly drapes an arm around the reader’s shoulder and assures him that we all do silly things, and almost every time, the reader wants to squirm away and say “not that silly”:

Have you ever grabbed for a coupon offering a free! package of coffee beans – even though you don’t drink coffee and don’t even have a machine with which to brew it?

Is there a reader anywhere in the world who has ever done what Ariely’s sympathetic tone here insinuates he and everybody else does all the time? Will a marathoning health-nut send away for a free ‘trial’ pack of cigarettes? Will an abstemious middle-aged Pennsylvanian nun grab a coupon for a free! six-pack of beer? Is Ariely really trying to suggest that somebody who doesn’t drink coffee and doesn’t have a coffee-maker would send for a packet of coffee beans just because it’s free? The whole gimmick of free! inducements requires a baseline interest in the product – people with no yards don’t want bags of fertilizer, free or otherwise. If Ariely doesn’t see this simple fact – and if he’s managed to turn a blind eye toward it in the life being lived all around him – what are we to make of his grander pronouncements?

A big part of the problem is that for all his academic credentials in the intricacies of how and why people do the things they do, he seems never to have actually purchased anything in his entire life. There’s something a little tedious in the I-just-got-here-from-Vulcan puzzlement he finds in everyday behavior. For instance, he posits a hypothetical: you’re shopping for a new pen and a new suit. At one office supply store, you find a nice pen for $25, but then you remember you saw the same pen for $18 at a store fifteen minutes away, so you go and get it there. But when the same fifteen-minute trip will get you a nice suit for $488 instead of $455, you don’t go. This mystifies our author:

But what is going on here? Is 15 minutes of your time worth $7, or isn’t it? In reality, of course, $7 is $7 – no matter how you count it. The only question you should ask yourself in these cases is whether the 15-minute trip across town, and the extra 15 minutes it would take, is worth the extra $7 you would save. Whether the amount from which this $7 will be saved is $10 or $10,000 should be irrelevant.

To which even a non-credentialed reader will instantly say: no it shouldn’t. And for the glaringly obvious reason that $7 is not necessarily $7. As the price of a small order of French fries, it’s a gigantic figure (in 2008); as the price for a seat on one of Titanic’s lifeboats, it’s a tiny figure. The buyer who has already made up his mind to spend $488 on a suit is thinking about $7 differently than a buyer who’s got a pen in mind, and the difference in that thinking – about which there is nothing at all irrational – will determine whether the 15-minute trip is made or aborted. Every single person in the capitalist West experiences a dozen such instances of financial relativity on a daily basis – except, apparently, Dan Ariely. That “unique” insight starts to take on a decidedly less attractive connotation.In order to explore many of his ideas about anchors, market forces, peer pressure, self-deception, and a host of other predictable irrationalities, Ariely constructs a wide variety of – I don’t know what to call them. Fancies? Games? Kooky mix-‘em-ups (ala Christopher Walken on Saturday Night Live)? Throughout his book, he calls them “experiments” and employs the lingo of the laboratory, talking about “controls” and “placebos” and the like. But in almost no cases are the things he does actual experiments: not only are they carried out in informal, ad hoc ways, but they almost always involve his students, who share universal propensities either toward resentment or toadying about which Ariely seems completely unaware, and which must invariably muddy the results far beyond what would be acceptable in any true experiment.

(Ariely’s teacherly ways are never far from the surface in Predictably Irrational, in fact, as when he attempts to assess his readers’ grasp of “traditional” morality: “Do you know the Ten Commandments?” he asks. “If you’d like to test yourself, write them down and compare your list with the list at the end of the chapter. To be sure you have them right, don’t just say them to yourself; write them down.” With that ‘to be sure you have them right’ standing in for ‘to be sure you don’t cheat.’)

However they’re called, these exercises often make for some of the best reading in Predictably Irrational, if you can suspend your search for scientific rigor and just enjoy the way we live now. The most outrageous of these exercises (and the one most likely to become notorious) involved a randomly-chosen group of male Berkeley undergraduates who were asked a set of questions about sex: Would they ever pay for it? Would they lie to get it? Would they consider it with a gender other than the one to which they’re attracted? Would they drug someone? Would they shag a sheep, or some other nonhuman? The young men answered these questions with just the admixture of honesty and candor you’d expect of the bright young Apollos of Berkeley. Then each of them was issued a laptop computer (suitably protected by a plastic wrapper) and told to answer the same questions online – while at the peak of masturbating. The results were completely different: while violently aroused, each one of these fine upstanding young men became a mindless ravening Pict – one marvels that the laptops survived. Ariely:

No matter how we looked at the numbers, it was clear that the magnitude of underprediction by the participants was substantial. Across the board, they revealed in their aroused state that they themselves did not know what they were like when aroused. Prevention, protection, conservatism, and morality were nowhere on the radar screen. They were unable to predict the degree to which passion would change them.

In an oddly plangent footnote, he adds:

These results apply most directly to sexual arousal and its influence on who we are; but we can also assume that other emotional states (anger, hunger, excitement, jealousy, and so on) work in similar ways, making us strangers to ourselves.

The exercise isn’t all that mysterious – the male human brain in a state of intense arousal releases powerful judgement-altering chemicals, including dopamine – this fact was already well known before Kinsey. But the sly, grinning insouciance of Ariely’s tactic – the thought of all those strapping undergrads rabbiting away in the cause of psuedoscience – is highly enjoyable, not to mention being something you’ll never see in the New England Journal of Medicine.

But there is one subject on which Predictably Irrational significantly and usefully amplifies what has gone before, and it calls forth a quality in his writing that entirely saves the book from irrelevance. Ariely devotes a great deal of space to the concept of market norms, driven by financial loss and gain, and their civic counterparts, social norms, driven by personal interaction, delineating the difference between the two and attempting to map their patterns. And as always, he has another exercise in mind: this time involving lawyers. He observes that when the AARP asked a group of lawyers if they’d offer legal services to needy retirees for a reduced hourly rate, the lawyers (bless the fist-sized empty spaces where their hearts should be) refused. But when they were asked if they’d provide those same services for free, they agreed. When goslings behave like this, they cannot fail to attract Ariely’s always-game attention:

What was going on here? How could zero dollars be more attractive than $30? When money was mentioned, the lawyers used market norms and found the offer lacking, relative to their market salary. When no money was mentioned they used social norms and were willing to volunteer their time. Why didn’t they just accept the $30, thinking of themselves as volunteers who received $30? Because once market norms enter our considerations, the social norms depart.… when a social norm collides with a market norm, the social norm goes away. In other words, social relationships are not easy to reestablish. Once the bloom is off the rose – once a social norm is trumped by a market norm – it will rarely return.

But on this subject (a subject which, somewhat intriguingly, has nothing to do with predictable irrationality – when he discusses our society’s seduction by market norms, and the cost of that seduction, our author is at his most passionate), Ariely isn’t merely confining himself to economic models. Here, even moreso than elsewhere in this deeply personal book, he’s looking outward, probing for the possibility of broader worths and perhaps more elusive reclamations:

In fact, if we contemplate how market norms have gradually taken over our lives in the past few decades – with their emphasis on higher salaries, more income, and more spending – we may realize that a return to some of the old social norms might not be so bad after all. In fact, it might bring quite a bit of the old civility back to our lives.

Anyone living in and lamenting the relentless commodification of the 21st century’s early years can certainly sympathize with that heartening call, although those who remember much of the 20th century could sadly inform Ariely that there never was much of that “old civility” floating around. Still, the tone of Predictably Irrational is earnestly optimistic – indeed, the author happily entreats his readers to log onto his website and join him in his ongoing “journey” to untangle the strangenesses of what it means to be human. There are worthier books than this one on the subject, but surely there can be few worthier goals.