Nudge: Improving Decisions about Health, Wealth, and Happiness by Richard Thaler and Cass Sunstein.

3/5 rating. 271 pages.

Book #33 of 2021. Read April 21, 2021.

This is a book all about using the inherent psychological and sociological norms of humans to push us into improved decision-making.

The authors are huge proponents of what they call “libertarian paternalism”. I don’t know if they could have chosen almost any less appealing term for such a great idea as both of these words have pretty horrendous connotations. Their definition of this is something akin to pushing people to opt for better choices in their lives, but not mandating or requiring it.

The authors go through a lot of different examples in everyday life of how the people who make choices about how we interact with the world (choice architects) impact our decisions. In a relatively popular (and telling) case, making the choice to be an organ donor the default selection when receiving an ID can heavily impact if people opt for this. As many as 97% of people say they are interested in donating organs, but the actual rates of organ cards are somewhere around 40% in the US, because you have to opt in to become a donor.

There are many reasons that people don’t always make the choices that they say they want to make, but it is certainly clear that the way our decisions are framed, the defaults that are chosen, and the info we receive about the choices all have huge impacts on our lives in everything from what we eat, to the mortgage we choose, all the way to how we invest.

If you are looking to better understand the ways we are influenced (both accidentally and not), this book is a good start to learning this. If you take the lessons in here to heart, you could even choose to simplify your good decision-making and become healthier, richer, and happier!

Quotes:

“In a world inhabited by experienced professionals trying to sell them things.”

“It is possible to predict the outcome of congressional elections with frightening accuracy simply by asking people to look quickly at pictures of the candidates and say which one looks more competent. These judgments, by students who did not know the candidates, forecast the winner of the election two-thirds of the time!”

“An especially good way to gain weight is to have dinner with other people. On average, those who eat with one other person eat about 35 percent more than they do when they are alone; members of a group of four eat about 75 percent more; those in groups of seven or more eat 96 percent more.”

“When your neighbor tells you that you can’t lose money buying (fill in the blank here) that is probably a good sign that it is time to get out of that type of investment. There are also lessons for policymakers, who should understand that when people are influencing one another, dramatic upward movements in markets may produce serious risks for investors and for the economy itself.”

“The key point here is that for all their virtues, markets often give companies a strong incentive to cater to (and profit from) human frailties, rather than to try to eradicate them or to minimize their effects.”

“Norman’s basic lesson is that designers need to keep in mind that the users of their objects are Humans who are confronted every day with myriad choices and cues.”

“The government would not regulate how much issuers could charge for services, but it would regulate their disclosure practices. The central goal would be to inform customers of every kind of fee that currently exists. This would not be done by printing a long unintelligible document in fine print. Instead, issuers would be required to make public their fee schedule in a spreadsheet-like format that would include all relevant formulas.”

#nudge #richardthaler #casssunstein #health #wealth #happiness #choices #psychology #sociology #booklover #bookreviews

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