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January 08, 2022

Are you in control of your own decisions?

Our brain is wired in a particular ways and this wiring, while very good for some things, is imperfect and makes us susceptible to certain errors and mistakes in our decision making, says Dan Ariely, author of Predictably Irrational: The Hidden Forces That Shape Our Decisions.

Moreover, because these mistakes are a part of us, we are repeatedly fooled by them in predictable and consistent ways.

“Our irrational behaviours are neither random nor senseless — they are systematic,” he writes. “We all make the same types of mistakes over and over.”

Take vision, for instance. We have lots of practice with it and more of our brain is dedicated to vision than to any other activities. But we get things wrong time and time again. Click here and here to put this to the test.

Ok, consider this — if we make mistakes in vision, what are the chances that we won’t make mistakes in other domains? Particularly in those that are more complex (dealing with insurance, money, etc.), and ones —like decision making and economic reasoning — in which we have less practice?

Not very high, says Ariely, who outlines his thesis in this excellent lecture.

It’s all a bit unsettling since it's apparent that some, and probably many, of our decisions are made by unconscious processing before we really become consciously aware of them.

Tell us, do you think your decision making is influenced in similar ways?

By Gordon Powers, MSN Money

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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...