One restaurant is half full, the other empty, which one would you choose?

To help us reach a decision faster we use mental shortcuts (known as “cognitive biases”). In this case we’re likely to judge the quality of the restaurant (food, service, ambiance etc.) simply by the number of customers we see dining there.

Biases lead to fast decisions but they could also lead to errors in judgment. This has produced a number of myths surrounding them. It’s time we busted them.

Myth #1: biases are negative and lead to illogical decisions

Despite what most might think, cognitive biases aren’t all that bad. Yes, in some cases, these mechanisms lead us astray to poor judgment and systematic errors. But this doesn’t mean they fail all the time or that they’re not well adapted for everyday use. We tend to ignore how in most cases they help us cope with the complexity of the world and the amount of information around us.

A new direction in economic theory and psychology tries to explain human behavior as the product of evolution. From this perspective, we can appreciate these biases aren’t there to make us irrational, but effective. Some features that appear to be flaws might be revealed to be adaptations.

Think of the social proof bias – the tendency to follow the actions of others. As in the restaurant example above, it might not always lead to the correct conclusions. From an evolutionary perspective though, social proof has led to increased group co-ordination or increased accuracy in judgments promoting the survival of the group. The inclination to imitate others was beneficial for the evolution of community-based civilization and in many cases it still is today.

So, it’s time to stop referring to biases as synonymous to irrationality or poor decision-making. We should also acknowledge their positive contribution in our everyday life.

Myth #2: biases cause behavior

A big misunderstanding is that biases cause behavior. They don’t. They merely describe it. Biases are labels that help account for a specific behavior, usually observed in a particular context.

Myth #3: biases are fixed traits

An erroneous expectation is that known biases always appear in everyone. It’s not that simple.

Biases aren’t fixed traits, they’re broader tendencies which aren’t followed by everyone equally. Not everyone, for example, follows the behavior of others – some are more conformists, others more rebellious.

Expecting everyone to always behave the same way strips human behavior of its individuality and complexity. Think of the ridiculous oversimplifications you’ll often find in segmentations, e.g. “millennials prefer this while baby-boomers prefer that”. As though the millions of people described by each were effectively just two people with different needs and preferences from each other.

This “thinking” leads to incorrect applications of behavioral science which have no effect or worse, they backfire.

The latter is exactly what happened in the Netherlands when they replaced their opt-in organ donation forms with opt-out forms with the default being,  “you’re an organ donor”. This change was expected to increase the number of registered donors because people tend to go with the default option. The use of a default nudge wasn’t considered to be a risk – it has been tried successfully in many different contexts including organ donation registrations in other European countries.

But the Dutch rebelled. The number of people actively opting-out was 6 times higher than the number of people who selected the default. An offered explanation is that the new policy was seen as a threat to the personal freedom of choice. In protest, most people did the exact opposite of what the policy makers intended. This way they expressed their disapproval of how the question was asked rather than expressing their real attitude towards becoming an organ donor.

There’s no guarantee the same bias will be present in different contexts, in different people or even in the same person under different circumstances. Our unique personality traits, as well as the given situation we find ourselves in,  significantly affect our behavior making the manifestation of biases an uncertain affair.

Myth #4: most of our decisions rely on biases

We forget that we still largely act and decide rationally. We don’t just rely on biases. If that were true, we’d be nothing more than a series of simplistic commands… if X, then Y. In reality, our decision-making process is intricate. Depending on the circumstances, it will take different elements into account and will use a variety of strategies. Unlike what the popular view of behavioral economics wants us to believe, there are many instances where we adopt a deliberate, thoughtful approach and carry out cost-benefit analyses.

Human behaviour is complex and sensitive to context and circumstances. We shouldn’t expect an observed effect to be ever-present, nor affecting everyone. Before blindly applying “successful” nudges, make sure you work with a behavioral scientist to test them with your specific audience in your unique environment.

Kiki