BOOK REVIEW
By
Randeep
Wadehra
The art of thinking clearly By Rolf Dobelli
Hachette. Pages: x + 326. Price: Rs. 299/-
Decision making needs clarity of thought, and it is neither
a common practice nor easy to think clearly. Several factors cloud our mind,
preventing us from thinking clearly. Hope, hubris, euphoria, phobia, bias and
disappointment… in fact a whole gamut of emotions, inherent attitudes and
situations can be powerful enough to derail the very process of thinking
clearly.
One of the factors that adversely affect our perspective is,
what the author calls, the ‘survivorship bias’, which operates because one
focuses on the successful, while the failures do not even register on our
consciousness. In the process, a person overrates his or her chances of success
in a given field – be it literature, performing arts or some other. Actually,
one should become extra cautious if one becomes successful a bit too quickly.
Dobelli cites casino players in this regard. Those who lose money in the first
few rounds often quit, and wisely too. But those who win good money initially,
persist even when they start losing money. They suffer from “association bias”,
i.e., they associate their early success with their own inbuilt skills and not
with luck.
Similarly, a majority of people suffer from illusions about
their physical beauty, strength and/or mental capabilities, which makes them
prey to alluring advertisements for beauty aids, physique-building equipment
etc. They do not realize that cosmetics do not make a model beautiful. She or
he is already good-looking enough and cosmetics only play a secondary role in
underscoring their attractive features. Similarly, various institutes providing
high education lure students by offering MBA degrees etc that would ostensibly
turn them into geniuses, thus catapulting them into high earnings bracket. We
know, that the reality is otherwise. There are plenty of iconic geniuses one
can cite, who have been school dropouts.
It is only human to take all credit for one’s success and
blame everybody else but yourself when experiencing failure. A student who has
topped his class would credit his own intelligence, hard work etc, but in case
he fails an exam he would blame his teachers or even question the examination
system’s fairness. When an investor gets good returns he takes credit for the
right investment decision; when he experiences losses he damns his portfolio
manager or investment adviser. Dobelli calls it “self-serving bias.”
Another factor that influences our minds is expert
prediction. Every day, on various media, we come across “experts” predicting
the rise or fall of a particular commercial phenomenon, or arrival of a new
technological marvel or innovation, or just the fortunes of specific corporate
houses. Experts generally adorn such predictions with a skein of statistics
presented in the form of complicated tables and charts and underscored with
impressive jargon. If one blocks the hyperbole and focuses on the contents’
merit, nothing but high-pitched sales talk emerges. The intention behind such
sophisticated waffle is purely commercial, if not actually mercenary.
Therefore, be critical of all predictions, even if known experts back these
with endorsements. Use your judgment by shedding bias and employing a focused,
clear mind. Similarly, during uncertain times, it is always better to hold back
until you can assess your options. A hasty response invariably results in
embarrassments if not outright failures.
In this witty and thought provoking book, Dobelli examines
different factors and situations that influence our perspectives vis-à-vis a
whole range of happenings in our everyday lives. He also points out how we need
to insulate against such influences, keep our vision clear and focused so that
we may arrive at the right decision.
Published in The Financial World dated 19 July 2013
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