6 Common Biases That Affect How You Make Decisions
Did you know that humans make an average of 35,000 decisions in a single day?
Every little action you make from the moment you wake up is made possible by your brain making rapid decisions on things like whether you should make your bed or meditate first, have coffee or tea before going to work, or respond to an email or delay it until tomorrow.
Thirty-five thousand seems like a lot but that’s because we usually make these small, mostly inconsequential choices without being aware that we're doing them. Instead, we rely on previous experiences, belief systems, and present emotional states to simplify the world around us so we can make quick, functional decisions.
However, this practical habit of the brain sometimes influences our social interactions in negative ways in the form of cognitive biases.
What is cognitive bias?
A cognitive bias is a subconscious error in thinking that results from the brain’s tendency to simplify information processing. It often results in a misinterpretation of the world based on a constructed subjective reality.
In his book The Art of Thinking Clearly, author Rolf Dobelli explains 99 of these thinking errors that you can find in most social interactions. In this article, we extract 6 of the most common ones which impact our day-to-day decision-making.
1. The bandwagon effect
The bandwagon effect is a form of cognitive bias where people follow behaviors or subscribe to certain ideas simply because everybody else seems to be doing so.
This can apply to fashion trends or en-vogue political ideologies, often reinforced by the dominant media. The bandwagon effect subconsciously herds us towards fads and makes us say: if everyone else is doing A, then it must be good!
While most fads are harmless, it’s not always the case. The group is not always right and it takes courage and self-awareness to go against the grain.
2. The anchoring effect
The Anchoring effect refers to a cognitive bias that occurs when people make their decisions based on the first bit of information they were given.
For example, if you see a shirt that costs $300 upon entering a shop, you’re going to see the next shirt that costs $70 as cheap — even affordable.
3. The Dunning-Krueger Effect
The Dunning-Krueger effect happens when a person who is not an expert in an area or field overestimates their ability to perform a task within that area.
For example, someone who thinks they understand how the economy works just because they have seen a YouTube video that explains it in brief.
To tackle this bias, you will need to be open to learning new ideas and be receptive to feedback and criticism.
4. The Sunk Cost Fallacy
The sunk cost fallacy is probably one of the most damaging cognitive biases. It occurs when we refuse to stop a certain behavior just because we have already put a lot of effort into it.
For example, someone who is in a long-term toxic relationship may refuse to leave because they have already devoted their youth, time, and effort to it.
However, by staying in the relationship, they will most likely end up wasting more time, effort, and energy on something they know won’t give them a positive reward or outcome in the end.
When facing a situation that forces you to go in even when you know you shouldn’t, it’s important to take a step back and attempt to remove emotional bias from the situation.
5. The confirmation bias
Confirmation bias is a cognitive bias wherein you actively look for evidence that confirms what you already believe in.
For example, a team manager who believes hard work is the key to success may think that their team’s failure to meet their monthly quota was because their team isn’t working as hard as they should.
This kind of thinking is prevalent in social media where people of a certain ideological leaning will only follow others who share the same beliefs as they do while muting or blocking those who disagree with them.
It then creates an echo chamber of ideas that only confirm what they are already convinced is the only right position.
To counter this bias, you should not shy away from asking questions and entertaining ideas that don’t necessarily agree with you.
6. Hindsight bias
Have you ever heard people say they “should have seen it coming” or “should have recognized the signs” after something happens? This is what is called the hindsight bias. It happens when people think they could have predicted an event before it happened.
Sometimes that is true but more often than not, most situations are not as predictable as you might think they are after the fact. There are so many moving factors in life that it’s impossible to even predict the absolute certainty of something happening tomorrow.
Bottom line
Humans rely on making good decisions to survive. But the brain’s mechanism of oversimplifying things doesn’t always hold ground in life’s many complex situations. In these cases, it’s important to be aware of the common biases at work so you can actively hold back against them.
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