Thinking in Bets
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investments, 44–45, 191–93, 195, 196, 203
IQ, 147
Ira the Whale, 135
irrationality, see rationality and irrationality
Ivey, Phil, 105–6, 108, 112, 116n
JAMA Internal Medicine, 164
Jenner, Brody, 120
Jentz v. ConAgra Foods, 228–29
jobs, 41–46
Johnson, Hollyn, 55
Journal of Experimental Psychology, 55
Journal of Law, Economics, and Organization, 144
Journal of the American Medical Association, 55
judges, 141–44, 147, 148
Jussim, Lee, 146
Kable, Joe, 250n
Kahan, Dan, 58, 62–64, 181n
Kahn, Herman, 243n
Kahneman, Daniel, 12, 14, 36, 52, 61, 181n
Katyal, Neal, 140
Kazmaier, Dick, 56–57
Kissinger, Henry, 243n
Klein, Gary, 219
Kluge: The Haphazard Evolution of the Human Mind (Marcus), 12–13, 52
Kubrick, Stanley, 19
Kurosawa, Akira, 157
language, 52, 197
Late Show with David Letterman, 119–21, 123, 125, 161, 171, 175, 205
lawyers, 28–29, 93, 110, 167, 202, 221, 222
learning, 2–3, 67, 77–78, 80, 82, 105, 108, 110, 113, 115, 116, 169, 173, 231
from experience, 78–80, 82, 88, 89, 91, 93–95
loop in, 80, 84, 120
poker and, 78
by watching, 96–97, 102
Lederer, Howard, 1–2, 101–2, 106, 123–24, 133–34, 161–62, 244n
Lederer, Richard, 90n
Lerner, Jennifer, 128–29, 132
Lester, Jason, 244n, 248n
Letterman, David, 119–21, 123, 125, 161, 171, 175, 205, 248n
Life of Lucullus (Plutarch), 160
Lombardi, Vince, 159
loss aversion, 36
low-fat diet, 54–55, 62, 85–86, 164–65
luck, 4, 7, 10, 11, 21, 22, 34, 35, 46, 79–80, 82, 86–92, 94–98, 101, 102, 110, 111, 113, 121, 123, 124, 129–31, 194, 205
skill vs., 82–85
Ludwig, David, 54–55
Lynch, Marshawn, 5, 7, 217n
Lyubomirsky, Sonja, 104
MacCoun, Robert, 90, 166, 168
Madden, John, 159
Maddon, Joe, 100
Magriel, Paul, 244n
Marcus, Gary, 12–13, 52
Marshmallow Test, 181n–82n
math skills, 64, 181n
Matrix, The, 122–23, 175–76
Mauboussin, Michael, 83n
Maxwell, James Clerk, 27
Medical Daily, 49
mental contrasting, 223
Merrill Edge, 185
Merton, Robert C., 153
Merton, Robert K., 151, 153–55
Meserve, Russell, 62
Mickelson, Phil, 109, 247n
Microsoft, 150
Mill, John Stuart, 137, 140, 163, 169
Mischel, Walter, 181n–82n
misconceptions, common, 49
Mitchell, Deborah, 219
Monday Morning Quarterback, 7, 8, 229
Montag, Heidi, 119–20
Morgenstern, Oskar, 19, 23
Morris, Benjamin, 6
motivated reasoning, 59–61, 63–64, 94, 102, 108, 115, 132, 136, 181n, 206
MTV, 119–21
Müller-Lyer illusion, 14–15
Myerson, Roger, 19–20
Nabisco, 85, 86
nails, 197
narratives, 60–62, 95–96, 105, 107–9, 157, 160
Nash, John, 19
National Medal of Science, 154
National Science Foundation, 1
natural selection, 91n–92n, 103
Nature, 166
negotiated settlements, 40, 202
New England Journal of Medicine (NEJM), 164, 165
New England Patriots, 5–7, 48, 216–18
New York, 218–20
New Yorker, 6, 218–19
New York Times, 140, 143, 153
Nick the Greek, 75–78, 84, 87, 90, 116
Nietzsche, Friedrich, 186, 187, 189
Night Jerry and Morning Jerry, 180–87
Nobel Prize, 12, 19–20, 36, 153, 166, 243n–44n
Normandy landings, 208
Obama, Barack, 140, 146
obesity and weight gain, 55, 85–86, 164
Odysseus, 200–201
Oettingen, Gabriele, 223–24
Olmsted, Frederick Law, 220
On Liberty (Mill), 137
Operation Overlord, 208
optimism, 226
outcomes, 78–82, 86, 88, 95, 108, 113–14, 134, 166–68, 175, 226, 231
blindness to, 166–67
fielding, 82–85, 87, 89–91, 95, 103, 105, 111–15, 121, 194, 195, 205
negative, preparing for, 189, 226
see also future
Pariser, Eli, 61
past, 178, 181, 183, 186
and moving regret in front of decisions, 186–89
see also time travel, mental
Pavlov, Ivan, 107–8, 134
peer review, 72, 147–50
Pennington, Nancy, 219
Perlmutter, Saul, 166, 168
perspective, 227
Pfizer, 150
physics, 166
pinball, 198
Pleasure of Finding Things Out, The (Feynman), 72n
Plutarch, 160
poker, 1–4, 7, 15–18, 28, 30–31, 33, 35, 37–38, 43, 47, 66–67, 75, 81–82, 90–91, 101–3, 105–6, 111, 115, 116, 123–24, 129, 167, 219, 231
belief formation and, 53
chess vs., 20–23, 80, 244n
decisions in, 116, 167, 179, 180, 188, 196–98
diversity of opinions and, 139
learning and, 78
long hours of playing, 188–89
loss limits in, 136–37, 187
napkin list of hands in, 101–2, 161–62
possible futures and, 211
scoreboard in, 196
seminars on, 167
six and seven of diamonds in, 53, 59–60, 121
strategic plans and long view in, 179, 180, 200
strategy group for, 124, 126–27, 131, 133–34, 136–37, 155, 167, 174
suited connectors in, 53–54
Texas Hold’em, 53
tilt in, 197–98
time constraints in, 179
tournaments, 241n
watching in, 97
workshopping in, 158–59
political beliefs, 63–64, 141–45, 162–63, 205
social psychologists and, 145–47
Pollan, Michael, 85
pollsters, 32, 230–31, 245n
Poundstone, William, 19, 246n
Powell, Justice, 143
Power of Habit, The (Duhigg), 106–7
Pratt, Spencer, 119–20
precommitments (Ulysses contracts), 200–203, 212, 221
decision swear jar, 204–7
Predictably Irrational (Ariely), 89n
prediction markets, 149–50
premortems, 221–26
president-firing decision, 8–11, 33, 43, 48, 158, 229–30
presidential election of 2016, 32–33, 61n, 230–31, 245n
Princess Bride, The, 23–26, 244n
Princeton Alumni Weekly, 57
Princeton-Dartmouth football game, 56–59
Prisoner’s Dilemma (Poundstone), 19, 246n
privacy, 157
Prospect Theory, 36
Prudential Retirement, 185
psychology, 145–47, 149
Pulitzer, Joseph, 60
p-values, 72
Rashomon, 157
Rashomon Effect, 157–58
rationality and irrationality, 11, 43, 51, 64, 181n, 183, 204
Ulysses contracts and, 201, 203
words, phrases, and thoughts that signal irrationality, 204–7
rats, 87
reconnaissance, 207–12, 218
red teams, 140, 170–71
Reese, Chip, 244n
reflexive mind, 12–14, 16, 181n
regret, 186–89, 212, 225, 230
Rehnquist, Justice, 143
Reiner, Rob, 244n
relationships, 195, 196, 199, 223
relocating, 38–43, 45, 46
Reproducibility Project: Psychology, 149–50
resulting, 7–11, 26, 166
Rethinking Positive Thinking: Inside the New Science of Motivation (Oettingen), 223
retirement, 182, 184–86, 203
Righteous Mind, The: Why Good People Are Divided by Politics and Religion (Haidt), 129–30
risk, 20, 34, 39, 42–44, 46–47, 66, 111, 179
Roberts, Justice, 143
Russo, J. Edward, 219
sales, 167, 215–16
Scalia, Justice, 143, 144
scenario planning, 209–18
schadenfreude, 102–3
Schwarzenegger, Arnold, 213
science, 67–68, 72, 147, 149–51, 154–55
bias and, 166
peer review and, 72, 147–50
sharing in, 155–56
Seattle Seahawks, 5–7, 22, 46, 48, 216–18
Seattle Times, 6
Seed, Huckleberry, 244n
Seidel, Erik, 3, 123–24, 130–31, 244n, 248n
Seifert, Colleen, 55
Seinfeld, Jerry, 180–87
self-compassion, 206
self-expression, 156
self-image and self-deception, 89, 123
Selfish Gene, The (Dawkins), 92n
self-narratives, see narratives
self-serving bias, 89–96, 102, 103, 108, 110–12, 115, 132, 136, 194
September 11 attacks, 140
settlements, negotiated, 40, 202
Shepperd, James, 95n
Shermer, Michael, 11–12
shooting the messenger or message, 160–64, 205
Siemens, 150
Silver, Nate, 32–33, 209–10, 230, 245n
skepticism, 154, 155, 169–71, 206, 224
skill, 7, 9, 48–49, 88–91, 94–96, 103, 111, 113, 121, 122
luck vs., 82–85
Skinner, B. F., 246n
Slate.com, 6
slot machines, 87–88
smart, being, 62–64, 147
SnackWell’s, 85–86, 179
Social and Personality Psychology Compass, 95n
social approval, 132–34
social contract, 121, 125
social media, 60–61, 148
social psychologists, 145–47
social scientists, 172n
sociology, 154
Sotomayor, Justice, 144
sports, 108–9
baseball, see baseball
football, see football
golf, 83, 109
Stanford Law Review, 58
Stanford University, 181n–82n, 185
Stanovich, Keith, 62
start-up companies, 29, 35
State Department, 139–40, 170
statistics and data interpretation, 63–64, 181n
Stockholm School of Economics, 149
stock tickers, ticker watching, 191–93, 196, 199, 200
strategic thinking, 211
Stumbling on Happiness (Gilbert), 50, 52, 104
Success Equation, The: Untangling Skill and Luck in Business, Sports, and Investing (Mauboussin), 83n
sugar, 54, 85, 164–65
suited connectors, 53–55
Sunstein, Cass, 141–42
Super Bowl, 5–7, 10, 22, 46, 48, 165–66, 216–18, 241n–42n
Supreme Court, 142–44
surfers, 197
swear jar, decision, 204–7
sweeping terms, 205
Syria, 140
System 1 and System 2, 12, 181n, 183, 203
Teller, Edward, 243n
temporal discounting, 181–83, 226
10-10-10 process, 188–89, 191, 199
Tetlock, Phil, 126n, 128–29, 132, 146
Texas Hold’em, 53
Theory of Games and Economic Behavior (von Neumann and Morgenstern), 19
“They Saw a Game: A Case Study” (Hastorf and Cantril), 56–59
Thinking, Fast and Slow (Kahneman), 12, 52
Thomas, Justice, 144
Thoreau, Henry David, 186
ticker watching, 191–93, 196, 199, 200
tilt, 197–200
Time, 56
Timecop, 177–78
time travel, mental, 176, 177–231
backcasting, 218–22, 225, 226
decision swear jar, 204–7
flat tire scenario and, 190–91, 194–96, 200
moving regret in front of decisions, 186–89
Night Jerry and Morning Jerry, 180–87
perspective and, 227
premortems, 221–26
temporal discounting, 181–83, 226
10-10-10 process, 188–89, 191, 199
tilt and, 197–200
and time as tree, 227–31
Ulysses contracts (precommitment), 200–203
see also future; past
Today, 7
Trivers, Robert, 91n–92n
Trump, Donald, 32–33, 140, 230–31, 245n
truth, 137, 169
truthseeking, 55, 70, 108, 110, 112, 115, 117, 120–23, 125, 126, 147, 150–51, 156–57, 172, 204, 207
accountability and, 176
agreement to engage in, 174
communication and, 172
truthseeking groups, see decision groups
Tulving, Endel, 178n–79n
tumors, 197
Tversky, Amos, 36
Twain, Mark, 144n
Twitter, 148
type I and type II errors, 12, 52
Ulysses contracts, see precommitments
uncertainty, 20, 26–30, 36, 47, 67–73, 80, 87, 94, 115, 139, 170, 230, 231
denial of, 206
expressing, 172–73, 246n
hidden and incomplete information, 20–23, 25, 26, 33–35, 45, 81, 87
illusion of certainty, 204, 206, 207
luck, see luck
universalism, 154, 155, 160–64, 173, 205
University of Pennsylvania, 1
USA Today, 5
visual illusions, 14–15, 64, 91
visualization, 223, 225
von Braun, Wernher, 243n
von Neumann, John, 18–20, 23, 90, 243n, 246n
Wall Street Journal, 32
Washington Post, 6
watching, 96–97, 102
weight gain and obesity, 55, 85–86, 164
weight loss, 221–23
Welch, Suzy, 188
Welles, Orson, 60
West, Richard, 62
White Castle, 135
Wilson, Russell, 5, 48, 218, 227
winning, 112, 130, 160, 224
WKRP in Cincinnati, 47, 49
Woodward, Bob, 143
World Poker Tour, 37
World Series, Bartman play and, 98–100, 114, 229, 247n
World Series
of Poker (WSOP), 1, 2, 37, 90–91, 106, 123n–24n, 248n
“Would You Rather” game, 104–5
wrong, being, 61, 71, 94, 114, 206, 245n
fear of being or suggesting, 172–73
redefining, 30–36, 73
“yes, and . . .,” 173–74, 207, 250n
zero-sum games, 45, 103
Zolotow, Steve, 248n
* Technically, they are continually evolving, but not fast enough to do us any good in our lifetimes.
* The deal in Texas Hold’em begins with two cards, facedown, to each player. Following an initial round of betting, all additional cards are community cards, dealt faceup. If there are two or more players remaining after the conclusion of the betting rounds, the winner is the player who makes the highest hand from a combination of their two hidden cards and the community cards dealt during the hand.
When players make their initial betting decision, there are still three more betting rounds and five community cards to be dealt. Even with so many cards yet to be dealt, there is a significant advantage to having a strong two-card combination. The best starting hand, of course, would be two aces. The worst is a seven and a two of different suits.
* In fairness, after the 2016 presidential election, Facebook is attempting to address this, as are some other sites.
* Legendary physicist Richard Feynman encapsulated this way that scientists communicate uncertainty and how they strive to avoid the extremes of right and wrong when he said, “Statements of science are not of what is true and what is not true, but statements of what is known to different degrees of certainty. . . . Every one of the concepts of science is on a scale graduated somewhere between, but at neither end of, absolute falsity or absolute truth.” (This appears in a collection of his short works, The Pleasure of Finding Things Out.)
* It’s impossible to have a detailed discussion about outcomes and learning without going into detail on what’s luck and what’s skill (and what’s a combination), which I do when necessary. For a treatment that more fully explores the differences between skill and luck, I recommend Michael Mauboussin’s The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing, along with other sources cited in the Selected Bibliography and Recommendations for Further Reading.
* Ariely, a professor of psychology and behavioral economics at Duke University, is simultaneously a leading researcher in the discipline of behavioral economics and responsible for introducing millions of people to the practical aspects of behavioral economics through popular TED Talks, best-selling books, a blog, a card game, and even an app. His most popular book is titled Predictably Irrational.
* I lifted these from an article by Robert MacCoun (described in the following paragraph) and repeat them without guilt. First, they are incredibly amusing and informative; the greater crime would be not sharing them. Second, MacCoun acknowledged that he got them from the book Anguished English, written by my father, Richard Lederer.