Overcoming Mental Shortcuts for Better Decision-Making
What do talking, writing, and thinking have in common? They’re all controlled by the brain. As the “headquarters'' of the body, the brain influences all cognitive and bodily functions 24/7. The brain uses cognitive bias—past beliefs and experiences—to quickly process the constant influx of information it receives. Because of this, cognitive bias affects how people process information, perceive others, and make decisions. While cognitive biases can be beneficial because they do not require much mental effort and allow you to make decisions relatively quickly, unconscious biases influence cognitive bias. “With unconscious bias, you may have a reaction to something based on prior beliefs, possibly even stereotypes, about something, but you’re not aware of that bias,” defines psychologist Kia-Rai Prewitt. “With cognitive bias, you might be very intentional about making a judgment on something based on your beliefs or previous experience,” (Cleveland Clinic 2023). Despite its good intentions, cognitive bias is heavily influenced by perspectives and bias, which can lead to people making inaccurate and irrational judgements. Overcoming cognitive biases allows for rational and objective decision making.
Recording Cognitive Biases
The list of known cognitive biases is so extensive that there’s a codex. Created by John Manoogian III and Buster Benson, the Cognitive Bias Codex estimates around 180 cognitive biases. The list is so extensive that the biases are arranged in a circle and then divided into four quadrants–all dedicated to a specific group of cognitive biases. The four quadrants are:
What should the brain remember?
Biases that affect memory for people, events and information
Too much information
Biases that affect how we perceive certain events and people
Not enough meaning
Biases that are used when the brain has too little information and need to fill in the gaps
Need to act fast
Biases that how we make decisions
Studying cognitive biases and their impact has made identifying and defining cognitive biases easier. Utilizing the codex, one can recognize any biases they exhibit and work toward improvements.
Common Examples of Cognitive Bias
Because cognitive bias occurs to simplify daily life, certain “normal” behaviors humans exhibit are in actuality, cognitive bias. The most common forms of cognitive bias are listed below:
Confirmation Bias
Confirmation bias is the tendency to interpret new information as confirmation of one's preexisting beliefs and opinions while giving disproportionately less consideration to alternative possibilities. Social media is rampant with confirmation bias. People tend to read online news articles that support their beliefs and fail to seek out sources that challenge them. Although confirmation bias happens unconsciously, one can still work towards overcoming it through open-mindedness and willingness to look at situations from different perspectives (Luippold et al., 2015).
Loss Aversion
Often associated with the "prospect theory"-- that some people may be more concerned with the chance of gains than losses- loss aversion can occur when people are more concerned with the chance of gains than losses. The brain treats each scenario as a one-off (Tversky et al., 1992). In actuality, everyone faces a multitude of choices every day. Although the brain treats each choice as a separate situation, people's choices form a broader repeating pattern where the brain tries to make a decision that feels most comfortable by avoiding losses or the decision that seems uncomfortable but leads to more gains over time. It might sound counterintuitive, but utilizing pragmatic strategies such as reflection and data usage assists one in making decisions properly.
Gambler's Fallacy
"83% of people quit right before they hit the jackpot" is a common saying among gamblers. The phrase represents the gambler's fallacy, the belief that the probability of an event is decreased when the event has occurred recently (Terrell 1994). If someone is flipping a coin and the coin has landed heads five times in a row, someone who is experiencing gambler's fallacy would think that the next time the coin is flipped, it will land on tails. While not everyone will be betting all black at the casino, the gambler's fallacy can occur daily. For example, in the case of childbirth, the gambler's fallacy means that people often believe that someone is "due" to give birth to a baby of a particular gender if they have previously given birth to several babies of the opposite gender (Barron 2009). Avoiding the gambler's fallacy requires awareness and knowledge of independent events. The dice from the previous example have no way of remembering previous rolls, meaning that the dice also have no way of influencing future rolls. Always taking into account the context of the situation leads to navigating away from cognitive biases.
Availability Cascade
An availability cascade is a self-reinforcing process where a straightforward explanation of a complex process gains prevalence in news networks. As a result of its newfound popularity, people adopt the belief and spread it to others, creating a regurgitation of news that could lead to public panic. A current example of availability cascade was the initial outbreak of COVID-19. Information about the new virus was not readily available to the public and as a result, many instances of availability cascade occurred, causing mass panic such as toilet paper and hand sanitizer going out of stock. Not getting caught in an availability cascade requires work but by fact checking news and listening to different sources, it will be easier to understand the entire situation, not just an oversimplified version of it.
Conclusion
Overall, cognitive biases are prevalent in every facet of life. Overcoming the mental shortcuts benefits in the long run by improving rational and critical thinking. Just by implementing strategies such as self-awareness, research, and contextualization, better decisions will be made.
Works Cited
Barron, Greg. “Wiley Online Library | Scientific Research Articles, Journals, ...” Wiley Online Library, 13 Oct. 2009, onlinelibrary.wiley.com/.
Luippold, B., Perreault, S., & Wainberg, J. (2015). Auditor’s pitfall: Five ways to overcome confirmation bias. Retrieved from https://www.babson.edu/academics/executive-education/babson-insight/finance-and-accounting/auditors-pitfall-five-ways-to-overcome-confirmation-bias/
Terrell, D. A test of the gambler's fallacy: Evidence from pari-mutuel games. J Risk Uncertainty 8, 309–317 (1994). https://doi.org/10.1007/BF01064047
Tversky, A., Kahneman, D. Advances in prospect theory: Cumulative representation of uncertainty. J Risk Uncertainty 5, 297–323 (1992). https://doi.org/10.1007/BF00122574
