Why complexity matters

Dan Ariely

Dan Ariely

Regular readers of The Hannibal Blog by now know my fascination with complexity and simplicity as subjects in their own right. I’ve equated simplicity with beauty and genius, and I’ve decried the nefarious complexity (man-made, as opposed to natural) in such vulgar monstrosities as America’s tax code.

Now I’ve come across one of two TED talks (below) by Dan Ariely, a behavioral economist with an interesting life story (he was burnt in an explosion, recovered and used his agony to generate amazing research ideas.)

Here he talks about how awfully bad we are at making decisions, and how awfully confident we nonetheless tend to be that we make good decisions, indeed that we are the ones deciding at all. Much of the time we are not.

Most of the ‘choices’ we have to make in our lives are too complex. And often even a tiny bit of extra complexity puts us over the edge. We can’t handle it, so we become passive and ‘opt’ for the default, whatever that is. That means that somebody else (the one who set, deliberately or not, stupidly or not, the default settings) actually decides for us. As Ariely says,

it’s because we care, it’s difficult, and it’s complex, and it’s so complex that we don’t know what to do, and because we have no idea what to do we just pick whatever was chosen for us.

He shows this with examples from organ donors in Europe to health care to (my favorite, of course) a really stupid (or unbelievably cunning) marketing pitch that The Economist once ran.

Worth 17 minutes of your time:

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9 thoughts on “Why complexity matters

  1. Read Arieli’s book “Predictably Irrational”. Its a fun easy read but really, it is a single idea well expressed in the 17 minutes you posted online. For a much more profound book dealing with the issue on a broader level, Influence by Cialdini is a MUST READ. Through simple manipulations using social conformity, the author demonstrates how people like you and me can be manipulated not just to pay double for things they don’t want but kill, betray their country or commit suicide.

    It is the definitive cookbook for everything from McDonald’s to Hinrich Himler and one of the best book I have ever read.

    • Well, the book did not address the Asch experiments directly, but gave this AMAZING example for the effect of “Social Proof”:

      After a high profile suicide, the statistics for plane crashes goes up. The connection? Apparently pilots with latent suicidal tendencies reading about the suicide see this as a social “OK” to kill themselves.

      This phenomena is known as the “Werther effect” (after Goethe’s novel The Sorrows of Young Werther.)

    • Amazing indeed.

      And it reminds me of my time reading Goethe’s Werther. (After its original publication, btw, there was indeed an outbreak of young romantic German men killing themselves for their damsels…..)

    • I do not understand how a book or movie could really be the motivating factor in killing oneself. Can we assume that these young men were depressed and the book was the tipping point? I wonder what the professionals say.

    • Obviously, these were not happy-go-lucky guys. The idea behind social proof is that we all have urges to do or not-do things society deems unacceptable. If the person contemplating the actions sees others doing it he is more likely to act on his impulse.

      BTW, the same mechanism works in Macro-Economics causing “bubbles” (tech, real-estate etc.)

  2. I’d simply like to comment that this notion is scary.

    Joe: Question:

    Once I read this book and become aware that so many, from my loved-ones to my students, from my pet-sitter to my hair dresser, are manipulating me, what does the author say to do with that?

    Does one then become a healthy or an unhealthy skeptic? I’ve always viewed skepticism as a good thing until it decays into a bitter cynicism.

    What do we do with this information? How are we to respond or act?

  3. Well, the author of the book confesses that he is one of the most easily “duped” people around and he hopes his book will help us recognize and “defend” ourselves from these cynical manipulations.

    Here is a rather harmless one we all know:

    Have you ever gotten those customized stickers or letterheads with your name on them from a local charity? They always say “These are our gift to you. They are yours regardless of whether you donate.”

    What they are doing is triggering a reciprocity mechanism we have that will cause us to go to great lengths to repay any gift we get and never stay “in debt” to someone else. We know all they want is our money, and yet we find it hard not to pay them.

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