I recently wrote two posts – one on the psychology dynamic duo of Tversky and Kahneman, as chronicled in Michael Lewis’s book The Undoing Project, the other on the power of being “disagreeable” in the sense of not needing social approval to embark on a worthwhile effort. Today, I’d like to combine them with an interesting example.
In his book, Lewis talks about the eminent economist Richard Thaler and how he was energized when he first discovered Tversky and Kahneman’s research. To understand the context of the story below, you must understand that although Thaler may now be described as an “eminent economist” (and is enough of a big shot to appear with pop star Selena Gomez in the movie “The Big Short” – and let’s be honest, we don’t often see economists hanging out with international pop stars), but at the time of the story below he was not remotely “eminent”.
In fact, he was clinging to a very precarious faculty position (a position that he had to beg for), had limited career prospects and a young family. So he wasn’t a guy with a safety net should he take a risk.
He was doing research for a thesis on how much money people would need to be paid to accept a certain amount of risk in their profession. As he engaged in a number of experiments, he noticed that people’s responses to various risk questions were contradictory. He eventually discovered Tversky and Kahneman’s insights about the human mind and it’s tendency to play tricks on us, and he wondered about how psychological insights like these could impact the field of economics – particularly given how much certainty economists tended to exhibit regarding their research conclusions.
From Lewis’s book:
“He (Thaler) told his thesis advisor about his findings. ‘Stop wasting your time with questionnaires and start doing real economics’ said his advisor.
Instead, Thaler began to keep a list. On the list were a lot of irrational things people do that economists claim that they don’t do, because economists presume that people are rational.”
If I were to ask you to pick out the most important word in the story above, what would you say it is?
The word that struck me most was the word “instead”.
Instead of doing what his thesis advisor told him to do….
Instead of doing what most faculty members might do…..
Instead of working to curry favor in his chosen field….
Instead of avoiding the mixing of two fields that historically didn’t get along….
….Thaler followed his instincts and his curiousity.
Can you find an opportunity to establish your own “instead”? Where are you being gently pushed that you think might be the wrong direction? Take one minute to think about this.
Often we proceed toward our decisions much like we float down a river. With the river’s direction and current doing the work, the trip can be quite pleasant. It requires effort to paddle out of the current, or even to turn around and head upstream. It requires us to say “instead”.