The Upside of Irrationality by Dan Ariely

Book Review: The Upside of Irrationality: The Unexpected Benefits of Defying Logic at Work and at Home by Dan Ariely

Nobody is doing more to add to our knowledge of the irrational side of human behavior than Dan Ariely. Not only does he conduct experiments that are elegant in their simplicity, but he writes about his work and that of other researchers in a highly acccessible way. Upside is the successor to the bestselling Predictably Irrational, and it takes to new topics, ranging from CEO pay to speed dating.

Lego Lessons

An example of the clever experimental techniques employed by Ariely and his fellow researchers is his examination of workplace satisfaction using Legos. Ariely and his team wanted to gauge what makes work meaningful (other than the paycheck!). He uses writers as one example; whether you are an academic researcher or a (mere?) blogger, you are likely motivated to write because others will find what you write meaningful. If you know that nobody will see what you write, you won’t be nearly as motivated.

Ariely and his team recruited students to build little Lego robots, and paid them on a declining scale for each one. The first robot would earn the builder $2, the next one $1.89, and so on. The subjects could stop building whenever they wished. To simulate meaningful vs. meaningless work, some subjects saw their creations accumulate while others saw each bot they built disassembled, ostensibly to free up pieces to build more bots. For both sets of subjects, the work and pay were identical. Being college students, getting some extra cash for easy, play-like work was a good deal. Nevertheless, there was a big difference between the two groups: the first group built an average of 10.6 bots vs 7.2 for the second group. The group that could see their work product accumulate worked nearly 50% harder and longer than the other group.

Transient Emotions Affect Decisions

Intuitively, we know that our emotions affect our behavior, even in unrelated domains. If we’ve just hung up after a stressful call with our tax accountant and our child asks for a cookie, we are more likely to respond with a sharp “no!” than otherwise. Ariely and fellow researcher Eduardo Andrade set out to see how this effect played out in the lab. They began by showing subjects either an annoying or amusing video, and then asking them to write about a similar experience in their own life. The subjects then participated in a variant of the Ultimatum Game in which they had to accept or reject an offer which was identical for all subjects. The somewhat unfair split ($7.50/$2.50) was much more likely to be rejected by the annoyed/angry participants than the happier ones. The offer was the same, but the emotional carryover from the video and writing exercise markedly altered their behavior on the unrelated money decision.

The second, and more telling part of the experiment took place at a later time when the emotions of the subjects had dissipated. Despite the absence of the emotional stimulus, the subjects behaved consistently with their previous decision. The behavior first triggered by the irrelevant emotion had itself become internalized.

There’s a lot to like in The Upside of Irrationality for anyone interested in the quirks of human behavior and how that knowledge can relate to real-world situations. Ariely even touches on user experience topics, noting that a typical retirement calculator isn’t built for real humans – it may provide a roadmap to reaching a particular savings number, but in no way does it tell the user what he wants to know: specifically, what that number will mean in terms of retirement lifestyle. Another financial product, annuities, are typically sold in a way that makes cost comparison difficult or impossible, causing consumers to make poor choices.

It’s predictable that you will like this book, and adding it to your bookshelf is in no way irrational!

Amazon Link: The Upside of Irrationality: The Unexpected Benefits of Defying Logic at Work and at Home
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