Tag Archives: rational

Lateral Views : So much of being a rational being?

The disadvantage of having a black car is the conspicuousness of anything un-black on it. I bruised my black car heavily on the right side. The sight of heavy scratches with white stains breaks my heart every morning. So, I … Continue reading

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Book Review-Predictaby Irrational by Dan Ariely

I picked up the book from Ankita’s place. Ankita is a Brand Manager in a MNC and a lot of the work involves in understanding ‘why people buy what they buy’ and understanding this consumer behavior involves dallying with psychology, sociology and of course behavioral economics. Behavioral economics is a new field and is given lots of importance now days because it differs from classical economics in the way that its treats people not as rational machines but as flesh and blood, whose behavior is fashioned by emotions, confusion, historical baggage and social conditioning. It’s almost like what the philosophers have been saying about reality and perception, that we tend to see the world not so much on what is the reality but through our own tinted glass. Now one of the principal tenets of classical economics is that individuals act in the best of their interest and in the most rational ways.
Now that the context has been set I shall get back to the review of the book ‘Predictably Irrational’ by Dan Ariely. I would say the first example in the book riveted me to the rest of the chapters. The first chapter is ‘The truth about relativity’ and it explains how human beings by nature find it difficult to decide on absolute terms because of what the author describes as ‘ individuals lacking an absolute value meter’. Hence individuals can be made to choose a particular option in a way the option is presented to them. Here the role of the ‘decoy ‘is very important. To give an example from the book- Continue reading

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