How We Decide (32 page)

But perhaps this data is an artifact of the lab, an effect of making people choose cars under artificial conditions. So Dijksterhuis ventured out into the real world. He began by surveying shoppers in a variety of different stores, asking them what information they considered when making their decisions. Based on these responses, he assigned a "complexity score" to a list of consumer products. Dijksterhuis found that some products, such as cheap kitchen tools (can openers, vegetable peelers, oven mitts, and so on) and home accessories (light bulbs, toilet paper, umbrellas, and so on), were relatively easy for shoppers to select. People didn't weigh many variables when making up their minds, because there weren't that many variables to consider. Since most stores carried only a few different brands of vegetable peelers and toilet paper, shoppers were able to quickly focus on the most important factors, like price. Making these simple consumer choices was the equivalent of choosing a car after learning only four attributes.

And, sure enough, when Dijksterhuis studied people shopping for modest cooking accessories, he discovered that spending more time thinking about their decisions led to more satisfaction later on. In general, people did best when they carefully compared all of their options and reasoned their way to the best vegetable peelers. They tended to regret their impulse purchases, since they'd end up with kitchen tools they didn't want or like. When buying easy consumer products, it's a good idea to take a few moments and reflect on the purchase.

Dijksterhuis then studied a more complicated shopping experience. His survey found that choosing furniture is one of the hardest consumer decisions, since it involves so many different variables. Consider a leather couch. First, you need to figure out if you like the way it looks and feels. (As Timothy Wilson demonstrated with strawberry jam, simply deciphering one's own preferences can be a very difficult cognitive task.) Then, you need to think about whether the couch will work at home. Will it clash with the coffee table? Match the drapes? Will the cat scratch the leather? Before you can make a good decision about the couch, this long list of questions needs to be answered. The problem is that the prefrontal cortex can't handle this much information by itself. As a result, it tends to fix on just one variable that may or may not be relevant, such as the color of the leather. The rational brain is forced to oversimplify the situation. Look, for instance, at the doctors who relied on MRIs to diagnose the causes of back pain; because the MRI provided them with so much anatomical data, they ended up focusing on spinal disc abnormalities, even though these abnormalities probably weren't the cause of the pain. This resulted in a lot of unnecessary surgery.

After shadowing shoppers at IKEA, the furniture warehouse, Dijksterhuis found that the longer people spent analyzing their options, the
less
satisfied they were with their decisions. Their rational faculties had been overwhelmed by the furniture store, and they ended up choosing the wrong leather couch. (IKEA offers more than thirty different kinds of sofas.) In other words, furniture shoppers did best when they didn't think at all and just listened to their emotional brains.

Remember the experiment involving the fine-art posters and the funny cat posters? In that study, led by Timothy Wilson, sub jects were less satisfied with their choices when they consciously thought about what to choose; analyzing their own preferences caused them to misinterpret those preferences. Wilson concluded that for selecting things like posters or strawberry jam, people are better off listening to their initial instincts. One of Dijksterhuis's most recent experiments involved replicating Wilson's study, but with a twist: he wanted to see if letting people engage in unconscious decision-making—they looked at posters and then were distracted by a series of anagrams for seven minutes—could lead them to make even better decisions.

The answer, it turns out, is a resounding yes. Consciously contemplating the posters once again led to the worst decisions—these people were the least satisfied with their choices when they were interviewed three weeks later. But the most satisfied subjects were those who let the poster options marinate in their unconscious brains for several minutes and then chose on the basis of which poster was associated with the most positive emotions. Dijksterhuis speculates that art posters benefit from such subterranean thought processes because they are complex choices requiring people to interpret their own subjective desires. It's not easy to figure out if you prefer van Gogh to Rothko, or if you'd rather look at an Impressionist landscape than an abstract expressionist canvas. "Imagine being at an art auction in Paris," Dijksterhuis says. "There's a Monet for sale for a hundred million, and a van Gogh for a hundred and twenty-five million. How should we make this choice? The best strategy may be the following: First, take a good look at both of the paintings. Then leave the auction and distract yourself for a while (which is easy to do in Paris), and only then decide."

These simple experiments shed light on a very common problem in everyday life. We often make decisions on issues that are exceedingly complicated. In these situations, it's probably a mistake to consciously reflect on all the options, as this inundates the prefrontal cortex with too much data. "The moral of this research is clear," Dijksterhuis says. "Use your conscious mind to acquire all the information you need for making a decision. But don't try to analyze the information with your conscious mind. Instead, go on holiday while your unconscious mind digests it. Whatever your intuition then tells you is almost certainly going to be the best choice." Dijksterhuis argues that this psychological principle has far-reaching consequences and can also be applied to decisions that don't involve shopping. Anyone who is constantly making difficult decisions, from corporate executives to poker players, can benefit from a more emotional thought process. As long as someone has sufficient experience in that domain—he's taken the time to train his dopamine neurons—then he shouldn't spend too much time consciously contemplating the alternatives. The hardest calls are the ones that require the most feeling.

At first glance, this idea might be a little difficult to accept. We naturally assume that such choices require the analytical rigor of the rational brain. When trying to decipher a complicated situation, we believe that we need to consciously reflect on our options, to carefully think through the different car models or compare all of the possible couches at IKEA. Simple situations, on the other hand, are generally deemed suitable for emotions. You might trust your gut to choose a main course for dinner, but you wouldn't dream of letting it select your next car. That's why the average American spends
thirty-five
hours comparing automotive models before he or she makes a decision about which car to purchase.

But the conventional wisdom about decision-making has got it exactly backward. It is the easy problems—the mundane math problems of daily life—that are best suited to the conscious brain. These simple decisions won't overwhelm the prefrontal cortex. In fact, they are so simple that they tend to trip up the emotions, which don't know how to compare prices or compute the odds of a poker hand. (When people rely on their feelings in such situations, they make avoidable mistakes, like those due to loss aversion and arithmetical errors.
^*
) Complex problems, on the other hand, require the processing powers of the emotional brain, the supercomputer of the mind. This doesn't mean you can just blink and know what to do—even the unconscious takes a little time to process information—but it does suggest that there's a better way to make difficult decisions. When choosing a couch, or holding a mysterious set of cards, always listen to your feelings. They know more than you do.

Michael Binger started winning poker tournaments once he realized that the game was more than a math problem. Although he's a physicist, trained to spot the quantitative pattern in the most stochastic of systems, Binger eventually discovered that he couldn't just crunch the numbers and expect to win the hand. He also needed to know when the numbers weren't enough. "I've been able to figure out the odds of poker hands for a while now, and yet, until recently, I never did very well in the World Series," Binger says. "I guess what you get better at is everything else, all the stuff that can't be quantified."

This epiphany allowed Binger to see the card game as it was, not as he wanted it to be. He no longer pretended that there was some universal solution to the problem of poker. The game was too complicated and unpredictable to summarize with statistics. Binger came to understand that different situations required different modes of thought. Sometimes he had to play the odds. And sometimes he had to trust his gut.

This insight doesn't apply to poker alone. Look, for instance, at the financial markets. Wall Street is often compared to games of chance—like Vegas, it's a place where luck can be as important as logic—and when it comes to decision-making, the parallels can be illuminating. Both poker and investing are inherently unpredictable enterprises, requiring people to act with incomplete information. Nobody knows how the market will respond to the latest economic data or what card will appear on the river. Nobody knows if the Federal Reserve is going to lower interest rates next quarter or if the player with the big pile of chips is bluffing. In such situations, the only way for anyone to succeed over the long term is to use both brain systems in their proper contexts. We need to think
and
feel.

A few years ago, Andrew Lo, a business professor at MIT, wired ten currency speculators and stock traders at a brokerage firm with sensors that monitored their heart rates, blood pressure, body temperature, and skin conductivity. These bodily signs correlate with emotions: intense feelings make for fast pulses. By the end of the day, the traders had made more than a thousand financial decisions, wagering over forty million dollars. If these professional investors were perfectly rational agents, as economic theory assumes, then they should have had perfectly calm bodies. When Lo looked at the data, however, he found that the decisions of the traders were the stuff of sweaty palms and spiking blood pressure. Most financial transactions were accompanied by surges of feeling.

This wasn't necessarily a bad thing. The vast majority of emotional decisions turned out to be profitable. Just because traders had nervous hands, or frightened amygdalas, didn't mean they were acting "irrationally." Rather, Lo discovered that the traders made the worst decisions when their emotions were either silent or overwhelming. In order to make the right investment decisions, the mind needs emotional input, but those emotions need to exist in a dialogue with rational analysis. Investors who got too worked up or who tried to rely on logic alone tended to make dramatic mistakes. "One of the implications of our experiments," Lo says, "is that strong emotional reactions to financial gains or losses can actually be counterproductive. On the other hand, too little emotional reaction can also be dangerous. There's an ideal range of emotional responses that professional securities traders seem to exhibit, and that's an insight that we think individual investors can benefit from." The best investors, like the best poker players, are able to find that crucial mental balance. They constantly use one brain system to improve the performance of the other.

Just look at Binger. On the one hand, he's always using his pre-frontal cortex to interrogate his emotions, to consciously question his unconscious brain. This doesn't mean he's ignoring his feelings—he's not making the strawberry-jam mistake—but it does mean that he's making sure to avoid any obvious emotional errors, what poker players refer to as tilt. "The way I look at it," Binger says, "is that it can't hurt to think for a few seconds about what I'm feeling. Most of the time, I'll still go with my instincts, but occasionally I'll catch myself doing something dumb."

Consider this poker hand from the first day of the tournament. Binger was trying to play it safe, but he ended up losing a big pile of chips when someone beat his pair of jacks on the river. Fortunately, Binger was self-aware enough to realize that such losses can trigger a dangerous set of feelings as the effects of loss aversion settle in. "You want your chips back," Binger says, "and that's when you find yourself taking risks you probably shouldn't take." At moments like this, Binger's prefrontal cortex reasserts control of his gambling decisions, preventing him from making an impulsive mistake: "I'll remind myself to play tight, to focus on the odds." You don't go all in if you've only got one out.

Situations like this demonstrate the importance of the prefrontal cortex. The rational parts of the brain are uniquely able to monitor feelings, using the reins of cognition to keep the horses from running wild. Ironically, it's those moments when emotions seem most persuasive—when the brain is completely convinced that it's time to go all in—that you should take a little extra time to reflect on the emotional decision. Make yourself consider alternative possibilities and scenarios. This is why the Israeli intelligence services added yet another analytical branch after the Yom Kippur War. "If the game seems simple or obvious, then you've made a mistake," Binger says. "The game is never simple. You've always got to wonder: what am I missing?"

Binger's ability to alternate between emotions and rationality has one important effect: it forces him to always think about
how
he's thinking. Because Binger has an array of cognitive strategies to choose from, he is constantly reflecting on which strategy he should use at any particular moment. This sort of mental flexibility is an essential feature of good decision-making. Look at the Philip Tetlock study of political pundits that we talked about in the last chapter. Although the study is best known for its demonstration of expert failure—the vast majority of pundits failed to predict better than random chance—Tetlock also found that a few performed far above average.