Dan Ariely explains how our decision making and our reasoning power are influenced by expectations, emotions and social norms. This book gives an introduction to behavioral economics. It is written for personal use as well as for professionals in the field of advertising and sales strategy.
What to expect / some of the chapters
• The Cost of Zero Cost – Why We Often Pay Too Much When We Pay Nothing
• The Problem of Procrastination and Self-Control – Why We Can’t Make Ourselves Do What We Want to Do
• Keeping Doors Open – Why Options Distract Us from Our Main Objective
• The Context of Our Character Part I – Why We Are Dishonest, and What We Can Do • about It
• The Context of Our Character Part II – Why Dealing with Cash Makes Us More Honest
By means of enjoyable experiments, Ariely points out what our strategies are when making decisions: We compute the cost-benefit ratio of our actions different to what we might think. Yes, these ways of computing can be used to influence customers but after all the book is about humanity and it explains why we act the way we act. That is often pretty surprising.
Two quick examples for that: Chapters like “The Cost of Zero Cost” explain how to monitor decisions more carefully especially in the field of consumption. In other chapters like “The Problem of Procrastination” the reader learns about how our intentions differ with the state of arousal we are in.
In explaining all this, Ariely deals with basic questions i) about satisfaction in a system that is based on constant economic growth, ii) about moral judgement, which is essential in times of credit-crunches that shake whole nations and iii) about basic blind spots when it comes to our own good behavior. The author manages to deal with these rather serious aspects in a very positive and entertaining way.
Would I suggest reading it?
I would! This book does not offer sales- or advertising strategies. It rather explains basic fallacies we all come across in very different aspects of our life – from greed to good intentions. It may help to understand yourself better as well as the customer you are dealing with.
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