Daniel Kahneman | The Knowledge Project #68

KEYPOINTS

• 01

  Happiness and life satisfaction are different things, and people want the second.

  Kahneman separates happiness, the emotional tone of daily life, from life satisfaction, how you feel when you step back and think about your life. Happiness is mostly social: being with people you love who love you back. Satisfaction is more conventional and tracks success, money, education and prestige. He began by assuming happiness in the moment was what was real and that satisfaction was just ‘stories people tell themselves.’ But the research showed people care less about how happy they’ll be than about having a good story of their life. A definition of well-being that people don’t care about was untenable, so he admits he no longer knows how to define it.

• 02

  Above a threshold, money stops adding happiness but keeps adding satisfaction.

  With economist Angus Deaton, Kahneman found that in the US, above roughly $70,000 a year, extra income didn’t improve day-to-day emotional happiness, though poverty clearly makes people miserable. Life satisfaction never leveled off: more was always better. He reads money as a proxy for success. Billionaires working flat out don’t need more money; they want proof they’re good at what they do. Both feeling happy and being satisfied appear to be good for health and longevity.

• 03

  To change behavior, weaken the restraining forces rather than push harder.

  Kahneman calls this the best psychological idea ever. It comes from Kurt Lewin, who saw behavior as a balance between forces pushing one way and forces pushing back, like how fast you drive. Our instinct is to push: arguments, incentives, pressure. Lewin’s insight was to ask, ‘Why aren’t they doing it already?’ and reduce those obstacles. Kahneman pictures a plank held between springs. Add a spring to push it and it moves, but the system ends up under more tension. Remove a spring holding it back and it moves with less tension. Even so, he’s skeptical about changing behavior at all, including your own; spouses trying to change each other are ‘not on their way to a good marriage.’

• 04

  Look at the situation before blaming the person.

  His second lesson is the fundamental attribution error: we assume people act from personality when the situation is often driving them. Motives are mixed, too; people do good things for good and bad reasons, and bad things for both. The point of teaching psychology is to make people less judgmental and more patient. Perspective matters in policy as well. The endowment effect means giving something up hurts more than getting it pleases, yet government reformers, like agents acting for others, don’t feel that pain. They underestimate how hard potential losers will fight, which is why reforms often fail or cost far more than planned to compensate the losers.

• 05

  We mostly don’t reason our way to beliefs; we adopt them from people we trust.

  Ask Kahneman for reasons and he’ll always find some, but reasons aren’t the causes of beliefs. He believes in climate change because he trusts the people who tell him it’s real, and skeptics trust other people. He’s more likely to believe fake news from his own side. Even scientists are swayed by commitment to their earlier views and by bruised egos. He calls independent clear thinking ‘to a first approximation impossible,’ and links the decline in public debate partly to polarization and people choosing their own news sources.

• 06

  Break judgments into independent parts and hold off on intuition.

  At 22, as a psychologist in the Israeli army, Kahneman replaced free-form ‘overall impression’ interviews with ratings of six traits, scored one at a time. Interviewers protested, ‘you’re turning us into robots.’ As a compromise, he let them close their eyes at the end and give an intuitive overall score. Both the trait scores and that final intuition predicted performance, and the method lasted over 50 years; a commander still told him, ‘then we tell them, close your eyes.’ The lesson: treat options like job candidates, score each dimension separately, stop only for a deal-breaker, and form your overall view once you see the full profile. Otherwise you form an impression fast and spend the rest of your time confirming it, like witnesses comparing notes.

• 07

  Organizations can fix judgment more easily than individuals can.

  After a lifetime studying biases, Kahneman says he’s not much better at avoiding them. Individuals rarely improve just by deciding to, and checking a list of biases mostly invites clever rationalizations. Organizations think more slowly and follow procedures, so they can change those procedures. Where possible, use algorithms or rules; they beat human judgment, though at a social cost. Otherwise, slow down, especially when you feel instantly sure. Protect dissenters, because dissent is painful and costly. Keep information-gathering independent of what decision-makers want. Have people write down their positions before a meeting, because groups converge fast. People resist it because it means work.

• 08

  Societies reward confident, fast intuition, even when waiting would be wiser.

  Everyone knows not to rewrite road-safety law right after a terrible crash, yet leaders are expected to respond immediately. Kahneman says people prefer intuitive, overconfident leaders and are suspicious of those who deliberate. He thinks Obama was at a disadvantage against George W. Bush because careful deliberation can look like not knowing what you’re doing. He also has a theory of expert overconfidence. Philosophers and psychologists judge ideas side by side, where differences look obvious, but people live one situation at a time, where countless other factors drown out each effect. So researchers’ clear intuitions turn into misplaced confidence.