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Monday, June 30, 2014

The innate effect of Bias; Naive Realism

The innate effect of Bias

"Research by behavioural economists has clearly demonstrated we are not rational; in fact we are naturally irrational. Deeply embedded biases affect every decision we make, there are conscious factors, learned from experience, subconscious cognitive biases and affective factors including our feelings and emotions at the time the decision is made. The challenge is to accept people as they are and then work rationally within our innate biases; this needs a rational approach to an irrational problem!...

Two biases that cut in when you have an issue that has already cost money and needs more funds committed to prevent potential future losses are loss aversion and Hyperbolic discounting...

Another pair of biases that affect problem solving are first our strong preference for our own creations over other people’s creations; reinforced by what behavioural economists call the ‘IKEA Effect’, the more labour we expend on a project, the more we love the result regardless of its quality. If someone has worked hard on the solution to a problem (or the creation of an estimate) they are innately programmed to love their solution! These are just a few of the biases built into all of us; most people are innately optimistic, over-value their personal skills and capabilities and over-value the advice of distant experts compared to the advice from someone they know well...

Naive realism is the belief that we see reality as it really is4 – objectively and without bias; and that those who don't see things ‘our way’ are either uninformed, or biased . The three "tenets" of naive realism are:

1. That I see entities and events as they are in objective reality, and that my social attitudes, beliefs, preferences, priorities, and the like follow from a relatively dispassionate, unbiased and essentially "unmediated" comprehension of the information or evidence at hand.

2. That other rational social perceivers generally will share my reactions, behaviours, and opinions— provided they have had access to the same information that gave rise to my views, and provided that they too have processed that information in a reasonably thoughtful and open-minded fashion.

3. That the failure of a given individual or group to share my views arises from one of three possible sources: a. the individual or group in question may have been exposed to a different sample of information than I was (in which case, provided that the other party is reasonable and open minded, the sharing or pooling of information should lead us to reach an agreement); b. the individual or group in question may be lazy, irrational, or otherwise unable or unwilling to proceed in a normative fashion from objective evidence to reasonable conclusions; or c. the individual or group in question may be biased (either in interpreting the evidence, or in proceeding from evidence to conclusions) by ideology, self-interest, or some other distorting personal influence.

The reality is my version of the ‘truth’ and your version of the ‘truth’ is as unreliable and biased as everybody else’s.

[Ed: Post-modernism! 1+1=3 is as unreliable and biased as 1+1=2!]

... A person’s current state of emotion can easily overpower rational thinking. If a person is tired, or emotionally stressed for any reason, these negative emotions will affect all of the decisions made regardless of the current decisions relationship to the cause of the emotion. Similarly if a person has just won an important sporting event (important to them, not to you or the world at large), the feeling of being successful and capable of winning will impact decisions and encourage more risky decisions.

In addition to their current emotions, we all store emotion charged memories. These emotions are automatically triggered in situations perceived to be similar to the stored memory."
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