Lessons from Predictably Irrational

Great book! This past week I read Predictably Irrational by Dan Ariely. I had started it a few years ago, but things got in the way and I never finished. I just wanted to give some bullet points as to what I took away from the book. (If you’re interested in it, check out the synopsis on Amazon).

  • Money is powerful, people hold it to a high regard, but remove it even just one-step and people who wouldn’t likely cheat or steal will do so
  • Be careful when it comes to FREE, it can change your preferences
  • Social and market norms are very tricky subjects (Ex. A social norm is bringing a bottle of wine to a dinner party. A market norm is paying a mover to move your furniture). Mixing these two norms is not a good idea. (Ex. Paying someone for hosting a dinner party)
  • People will work for free or work for a reasonable wage. When working for free, it has to be for something good or as a social norm (Helping move a friend’s couch).
  • Gifts are effective, but put a price-tag on that gift and you’ve now introduced market norms
  • People primed to think about money end up being more selfish and self-reliant
  • People are not good at self-control, even thought they overestimate this ability
  • People require freedom but also need some boundaries/restraints to do their best work
  • We overvalue what we own. We need to place less emphasis on our ownership of things when it comes to selling them or getting rid of them. (Obviously not for sentimental items like photos)
  • A seller’s floor is a buyer’s ceiling
  • We focus on what we may lose rather than what we gain
  • We hate to close off all our opportunities, even if those opportunities are not as fruitful

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