The Undoing Project: A Friendship That Changed Our Minds

by Michael Lewis

After seeing the diabolically clever data-based approach taken by the North Carolina legislature in writing laws to make it more difficult for African Americans to vote, the comedian John Oliver congratulated the legislators for having “Money-balled racism.”

“And then we would go to our clients and tell them we could predict the price of oil. No one can predict the price of oil. It was basically nonsense.”

There’d been a lot more stuff just like that. People who didn’t know Daryl Morey assumed that because he had set out to intellectualize basketball he must also be a know-it-all. In his approach to the world he was exactly the opposite. He had a diffidence about him—an understanding of how hard it is to know anything for sure. The closest he came to certainty was in his approach to making decisions. He never simply went with his first thought. He suggested a new definition of the nerd: a person who knows his own mind well enough to mistrust it.

“Knowledge is literally prediction,” said Morey. “Knowledge is anything that increases your ability to predict the outcome. Literally everything you do you’re trying to predict the right thing.

“Confirmation bias is the most insidious because you don’t even realize it is happening,”

Maybe the mind’s best trick of all was to lead its owner to a feeling of certainty about inherently uncertain things.

“the endowment effect.”

“When someone says something, don’t ask yourself if it is true. Ask what it might be true of.” That was his intellectual instinct, his natural first step to the mental hoop: to take whatever someone had just said to him and try not to tear it down but to make sense of it.

psychology of single questions.

He had listened to an American economist talk about how so-and-so was stupid and so-and-so was a fool, then said, “All your economic models are premised on people being smart and rational, and yet all the people you know are idiots.”

The test was to translate three pages from a book in the language: The student chose the book, and the tester chose the pages to translate. Amos went to the library and dug out a French math textbook with nothing but equations in it. “It might have had the word donc in it,” said Amos’s roommate Mel Guyer. The University of Michigan declared Amos Tversky proficient in French.

What goes on in the mind when it evaluates how much one thing is like, or not like, another? The process is so fundamental to our existence that we scarcely stop to think about it.

“The directionality and asymmetry of similarity relations are particularly noticeable in similes and metaphors,”

When people make decisions, they are also making judgments about similarity, between some object in the real world and what they ideally want. They make these judgments by, in effect, counting up the features they notice. And as the noticeability of features can be manipulated by the way they are highlighted, the sense of how similar two things are might also be manipulated.

By changing the context in which two things are compared, you submerge certain features and force others to the surface.

That is, the mere act of classification reinforces stereotypes. If you want to weaken some stereotype, eliminate the classification.

And yet at the same time, Israel took its professors more seriously than America did. Israeli intellectuals were presumed to have some possible relevance to the survival of the Jewish state, and the intellectuals responded by at least pretending to be relevant.

Barbara was struck by how casually her new husband tossed his Uzi on the bed before taking a shower. No big deal!

Here was another way Israel was different from the United States: Its wars were short, and someone always won.

Nonmathematical psychologists, like Danny, quietly viewed much of mathematical psychology as a series of pointless exercises conducted by people who were using their ability to do math as camouflage for how little of psychological interest they had to say.

“The idea that everyone is entitled to his/her opinion was a California thing—that’s not how we did things in Jerusalem.”

He said, ‘It cannot be that judgment does not connect with perception. Thinking is not a separate act.’” The new studies being made about how people’s minds worked when rendering dispassionate judgments had ignored what was known about how the mind worked when it was doing other things.

Amos was not merely an optimist; Amos willed himself to be optimistic, because he had decided pessimism was stupid. When you are a pessimist and the bad thing happens, you live it twice, Amos liked to say. Once when you worry about it, and the second time when it happens.

“People’s intuitions about random sampling appear to satisfy the law of small numbers, which asserts that the law of large numbers applies to small numbers as well,”

The entire project, in other words, was rooted in Danny’s doubts about his own work, and his willingness, which was almost an eagerness, to find error in that work.

People’s “intuitive expectations are governed by a consistent misperception of the world,”

Why would the judgment of an expert—a medical doctor, no less—be inferior to a model crafted from that very expert’s own knowledge? At that point, Goldberg more or less threw up his hands and said, Well, even experts are human.

When does our rule-of-thumb approach to calculating the odds lead to serious miscalculation? One answer was: Whenever people are asked to evaluate anything with a random component to it.

We have a kind of stereotype of “randomness” that differs from true randomness. Our stereotype of randomness lacks the clusters and patterns that occur in true random sequences.

Human judgment was distorted by . . . the memorable.

“Images of the future are shaped by experience of the past,” they wrote, turning on its head Santayana’s famous lines about the importance of history: Those who cannot remember the past are condemned to repeat it.

“We often decide that an outcome is extremely unlikely or impossible, because we are unable to imagine any chain of events that could cause it to occur. The defect, often, is in our imagination.”

People predict by making up stories People predict very little and explain everything People live under uncertainty whether they like it or not People believe they can tell the future if they work hard enough People accept any explanation as long as it fits the facts The handwriting was on the wall, it was just the ink that was invisible

But this new work Amos was apparently doing with Danny Kahneman was breathtaking. It confirmed Biederman’s sense that “most advances in science come not from eureka moments but from ‘hmmm, that’s funny.’”

Historians imposed false order upon random events, too, probably without even realizing what they were doing. Amos had a phrase for this. “Creeping determinism,” he called it—and jotted in his notes one of its many costs: “He who sees the past as surprise-free is bound to have a future full of surprises.”

The core idea of evidence-based medicine was to test the intuition of medical experts—to check the thinking of doctors against hard data.

“It was such a preventable case. And the guy hadn’t been wearing a helmet.” Redelmeier was newly struck by the inability of human beings to judge risks, even when their misjudgment might kill them.

What is it with you freedom-loving Americans? he asked. Live free or die. I don’t get it. I say, “Regulate me gently. I’d rather live.” His fellow student replied, Not only do a lot of Americans not share your view; other physicians don’t share your view.

“We attribute this phenomenon to selective matching,” Tversky and Redelmeier wrote.† “. . . For arthritis, selective matching leads people to look for changes in the weather when they experience increased pain, and pay little attention to the weather when their pain is stable. . . . [A] single day of severe pain and extreme weather might sustain a lifetime of belief in a relation between them.”

“peak-end rule.”

Given the work on human judgment that he and Amos had just finished, he found it further troubling to think that “crucial decisions are made, today as thousands of years ago, in terms of the intuitive guesses and preferences of a few men in positions of authority.” The failure of decision makers to grapple with the inner workings of their own minds, and their desire to indulge their gut feelings, made it “quite likely that the fate of entire societies may be sealed by a series of avoidable mistakes committed by their leaders.”

“No one ever made a decision because of a number. They need a story.”

People didn’t maximize value, he said; they maximized “utility.”

“The more money one has, the less he values each additional increment, or, equivalently, that the utility of any additional dollar diminishes with an increase in capital.”

“Obviously it is not regret itself that determines decisions—no more than the actual emotional response to consequences ever determines the prior choice of a course of action,”

Happy people did not dwell on some imagined unhappiness the way unhappy people imagined what they might have done differently so that they might be happy.

Regret was closely linked to feelings of responsibility.

“Always keep one hand firmly on data,” Amos liked to say. Data was what set psychology apart from philosophy, and physics from metaphysics.

But what was this thing that everyone had been calling “risk aversion?” It amounted to a fee that people paid, willingly, to avoid regret: a regret premium.

They were trying to carve human nature at its joint, but the joints of an emotion were elusive.