Here’s the Thinking Fast and Slow summary. Learn how to guard yourself against mental glitches that happen every day. Learn more about how your brain works and how you make decisions.
Thinking Fast and Slow author Daniel Kahneman explains the two systems that drive how our minds work. System 1 is fast, intuitive, and emotional. System 2 is slower, more deliberative, and more logical.
If we have a deeper understanding of how our minds work, we can make better decisions. We can also be aware of the mental glitches that sometimes rule our personal lives and corporate decisions.
About the Author
Daniel Kahneman was awarded the 2002 Nobel Memorial Prize in Economic Sciences. He specializes in conducting studies on judgment and decision making.
His book Thinking Fast and Slow was awarded the National Academy of Sciences Communication Award in 2011. Aside from judgment and decision making, he also has contributions in the field of availability heuristic, conjunction fallacy, loss aversion, and prospect theory.
You can watch his TED talk if you prefer listening to him.
Main takeaways: Thinking Fast and Slow Summary
Let’s discuss the key takeaways from his book:
- Our brains are lazy.
- Loss is more powerful than gain.
- Familiarity is also powerful.
Our brains are lazy
We don’t look for easier solutions. What we look for are easier problems.
Why? Because our brains want to save energy. The brain is only a small part of our body. Yet it spends around 20 percent of our total energy intake.
Remember that there are two modes of thinking. System 1 is emotional and automatic. System 2 is slower and rational. In many cases, System 1 runs because it’s automatic. We save energy as a result.
However, System 1 thinking can lead to errors in judgment. Well we can put System 2 to work. But it’s mentally taxing. The best solution is to use System 2 (slower and rational) when making big decisions.
When you’re making a huge decision but you’re tired, sleep on it. Let your brain replenish itself so you have more energy to tackle the situation.
Loss is more powerful than gain
If you gain 1,000 pesos, you feel good. But what if you lose 1,000 pesos? You’ll feel terrible.
The power of loss is also at work when businesses give limited-time offers. Special discount sale is only for a few days. People will buy just to avoid losing the opportunity.
Also, we value things that are soon to be gone. If we think that we might lose something, we hold on to it tighter. We will take some efforts to avoid the possible loss.
That’s why we avoid risks at all costs. We do that even if the gains will far exceed the losses. If someone’s making a decision, remind her always of the possible losses. There’s a good chance she will back down.
Look at the numbers if you want to avoid this. Put your System 2 thinking at work. Take some time to think about it. Write the pros and cons. Ask feedback. Then you will get more insights before you make a decision.
Familiarity is also powerful
A lie is a lie no matter how many times you say it. Well, provide frequent repetition and enough time, that lie will become truth in the subject’s minds.
If you hear about the toxicity of tilapia often, there’s a chance you will believe it. You get familiar about the dangers of eating tilapia. You also read it from different sources.
The result is you will accept it as truth. Familiarity kicks in. If you’re familiar about something, you feel safe.
It’s a mental glitch especially now in the modern world. During the prehistoric times, familiarity helped our ancestors survived. If something’s familiar, it’s safe. No need to worry about it.
But now, familiarity is now being used as a weapon to influence people. We get exposed to ads and propaganda repeatedly. Our brains are lazy so we just accept the “facts.” We didn’t take the time to examine the info.
Aside from the laziness of our brains, loss aversion, and familiarity, you can also learn the following from Thinking Fast and Slow book:
- We overestimate the likelihood of rare events
- Media coverage is often biased
- Why the sunk-cost fallacy leads to further failures
- To get pleasure from something, you must notice that you are doing it
- Our brains always form associations
My personal takeaways
I realized that my brain is not that reliable. We default to using System 1 thinking because it’s fast. But relying much on it will have consequences.
Yes System 2 thinking is not required at all times. We don’t have the resources to make thoughtful and rational decisions every time. But once we’re aware of our own limitations, we know how to act.
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