The Undoing Project A Friendship that Changed the World

But because he was Danny, he made a rule about his fantasy life: He never fantasized about something that might happen. He established this private rule for his imagination once he realized that, after he had fantasized about something that might actually happen, he lost his drive to make it happen. His fantasies were so vivid that “it was as if you actually had it,” and if you actually had it, why would you bother to work hard to get it?

The homeless were a notorious drag on the local health care system. They turned up in emergency rooms more often than they needed to. They were a drain on resources. Every nurse in Toronto knew this: If you see a homeless person wander in, hustle him out the door as fast as you can. Redelmeier wondered about the wisdom of that strategy. And so, in 1991, he created an experiment. He arranged for large numbers of college students who wanted to become doctors to be given hospital greens and a place to sleep near the emergency room. Their job was to serve as concierges to the homeless. When a homeless person entered the emergency room, they were to tend to his every need. Fetch him juice and a sandwich, sit down and talk to him, help arrange for his medical care. The college students worked for free. They loved it: They got to pretend to be doctors. But they serviced only half of the homeless people who entered the hospital. The other half received the usual curt and dismissive service from the nursing staff. Redelmeier then tracked the subsequent use of the Toronto health care system by all the homeless people who had visited his hospital. Unsurprisingly, the group that received the gold-plated concierge service tended to return slightly more often to the hospital where they had received it than the unlucky group. The surprise was that their use of the greater Toronto health care system declined. When homeless people felt taken care of by a hospital, they didn’t look for other hospitals that might take care of them. The homeless said, “That was the best that can be done for me.” The entire Toronto health care system had been paying a price for its attitude to the homeless.

They explained that people chose the more detailed description, even though it was less probable, because it was more “representative.” They pointed out some places in the real world where this kink in the mind might have serious consequences. Any prediction, for instance, could be made to seem more believable, even as it became less likely, if it was filled with internally consistent details. And any lawyer could at once make a case seem more persuasive, even as he made the truth of it less likely, by adding “representative” details to his description of people and events.

People were blind to logic when it was embedded in a story. Describe a very sick old man and ask people: Which is more probable, that he will die within a week or die within a year? More often than not, they will say, “He’ll die within a week.” Their mind latches onto a story of imminent death and the story masks the logic of the situation.

The present world is often surprising, i.e., less plausible than some of its alternatives, [...] the context of alternatives or the possibility set determines our expectations, our interpretations, our recollection and our attribution of reality, as well as the affective states which it induces.“ Toward the end of his thinking on the subject, [Amos] summed up a lot in a single sentence: “Reality is a cloud of possibility, not a point.”

[...] the rules of undoing. One rule was that the more items there were to undo in order to create some alternative reality, the less likely the mind was to undo them. People seemed less likely to undo someone being killed by a massive earthquake than they were to undo a person’s being killed by a bolt of lightning, because undoing the earthquake required them to undo all the earthquake had done. “The more consequences an event has, the larger the change that is involved in eliminating that event,” Danny wrote to Amos. Another, related, rule was that “an event becomes gradually less changeable as it recedes into the past.” With the passage of time, the consequences of any event accumulated, and left more to undo. And the more there is to undo, the less likely the mind is to even try. This was perhaps one way time heals wounds, by making them feel less avoidable.

People did not choose between things. They chose between descriptions of things. [...] Economists assumed that you could simply measure what people wanted from what they chose. But what if what you want changes with the context in which the options are offered to you? “It was a funny point to make because the point within psychology would have been banal,” the psychologist Richard Nisbett later said. “Of course we are affected by how the decision is presented!

Problem A. In addition to whatever you own, you have been given $1,000. You are now required to choose between the following options: Option 1. A 50 percent chance to win $1000 Option 2. A gift of $500” Most everyone picked option 2, the sure thing. Problem B. In addition to whatever you own, you have been given $2,000. You are now required to choose between the following options: Option 3. A 50 percent chance to lose $1,000 Option 4. A sure loss of $500 Most everyone picked option 3, the gamble. The two questions were effectively identical. In both cases, if you picked the gamble, you wound up with a 50-50 shot at being worth $2,000. In both cases, if you picked the sure thing, you wound up being worth $1,500. But when you framed the sure thing as a loss, people chose the gamble. When you framed it as a gain, people picked the sure thing. The reference point—the point that enabled you to distinguish between a gain and a loss— wasn’t some fixed number. It was a psychological state.

Whatever that emotion was, it became stronger as the odds became more remote. If you told them that there was a one-in-a-billion chance that they’d win or lose a bunch of money, they behaved as if the odds were not one in a billion but one in ten thousand. They feared a one-in-a-billion chance of loss more than they should and attached more hope to a one-in-a-billion chance of gain than they should. People’s emotional response to extremely long odds led them to reverse their usual taste for risk, and to become risk seeking when pursuing a long-shot gain and risk avoiding when faced with the extremely remote possibility of loss. (Which is why they bought both lottery tickets and insurance.)

People regretted what they had done, and what they wished they hadn’t done, far more than what they had not done and perhaps should have. “The pain that is experienced when the loss is caused by an act that modified the status quo is significantly greater than the pain that is experienced when the decision led to the retention of the status quo,” Danny wrote in a memo to Amos. “When one fails to take action that could have avoided a disaster, one does not accept responsibility for the occurrence of the disaster.”

Danny was stunned: If a 10 percent increase in the chances of full-scale war with Syria wasn’t enough to interest the director-general in Kissinger’s peace process, how much would it take to convince him? That number represented the best estimate of the odds. Apparently the director-general didn’t want to rely on the best estimates. He preferred his own internal probability calculator: his gut. “That was the moment I gave up on decision analysis,” said Danny. “No one ever made a decision because of a number. They need a story.” As Danny and Lanir wrote, decades later, after the U.S. Central Intelligence Agency asked them to describe their experience in decision analysis, the Israeli Foreign Ministry was “indifferent to the specific probabilities.” What was the point of laying out the odds of a gamble, if the person taking it either didn’t believe the numbers or didn’t want to know them? The trouble, Danny suspected, was that “the understanding of numbers is so weak that they don’t communicate anything. Everyone feels that those probabilities are not real—that they are just something on somebody’s mind.”

It wasn’t just sports announcers and political pundits who radically revised their narratives, or shifted focus, so that their stories seemed to fit whatever had just happened in a game or an election. Historians imposed false order upon random events, too, probably without even realizing what they were doing. Amos had a phrase for this. “Creeping determinism,” he called it—and jotted in his notes one of its many costs: “He who sees the past as surprise-free is bound to have a future full of surprises.” A false view of what has happened in the past makes it harder to see what might occur in the future. The historians in his audience of course prided themselves on their “ability” to construct, out of fragments of some past reality, explanatory narratives of events which made them seem, in retrospect, almost predictable. The only question that remained, once the historian had explained how and why some event had occurred, was why the people in his narrative had not seen what the historian could now see.

All too often, we find ourselves unable to predict what will happen; yet after the fact we explain what did happen with a great deal of confidence. This “ability” to explain that which we cannot predict, even in the absence of any additional information, represents an important, though subtle, flaw in our reasoning. It leads us to believe that there is a less uncertain world than there actually is, and that we are less bright than we actually might be. For if we can explain tomorrow what we cannot predict today, without any added information except the knowledge of the actual outcome, then this outcome must have been determined in advance and we should have been able to predict it. The fact that we couldn’t is taken as an indication of our limited intelligence rather than of the uncertainty that is in the world. All too often, we feel like kicking ourselves for failing to foresee that which later appears inevitable. For all we know, the handwriting might have been on the wall all along. The question is: was the ink visible?

After the trip, Fischhoff went back and asked the same people to recall the odds they had assigned to each outcome. Their memories of the odds they had assigned to various outcomes were badly distorted. They all believed that they had assigned higher probabilities to what happened than they actually had. They greatly overestimated the odds that they had assigned to what had actually happened. That is, once they knew the outcome, they thought it had been far more predictable than they had found it to be before, when they had tried to predict it. A few years after Amos described the work to his Buffalo audience, Fischhoff named the phenomenon “hindsight bias.”

People are very good at detecting patterns and trends even in random data. In contrast to our skill in inventing scenarios, explanations, and interpretations, our ability to assess their likelihood, or to evaluate them critically, is grossly inadequate. Once we have adopted a particular hypothesis or interpretation, we grossly exaggerate the likelihood of that hypothesis, and find it very difficult to see things any other way.

People predict by making up stories People predict very little and explain everything People live under uncertainty whether they like it or not People believe they can tell the future if they work hard enough People accept any explanation as long as it fits the facts The handwriting was on the wall, it was just the ink that was invisible People often work hard to obtain information they already have And avoid new knowledge Man is a deterministic device thrown into a probabilistic Universe In this match, surprises are expected Everything that has already happened must have been inevitable

The psychologist Kurt Lewin had suggested persuasively that, rather than selling people on some change, you were better off identifying the reasons for their resistance, and addressing those. Imagine a plank held in place by a spring on either side of it, Danny told the students. How do you move it? Well, you can increase the force on one side of the plank. Or you can reduce the force on the other side. “In one case the overall tension is reduced,” he said, “and in the other it is increased.” And that was a sort of proof that there was an advantage in reducing the tension. “It’s a key idea,” said Danny. “Making it easy to change.”

People said some strange things. For instance, they said that magenta was similar to red, but that red wasn’t similar to magenta. Amos spotted the contradiction and set out to generalize it. He asked people if they thought North Korea was like Red China. They said yes. He asked them if Red China was like North Korea—and they said no. People thought Tel Aviv was like New York but that New York was not like Tel Aviv. People thought that the number 103 was sort of like the number 100, but that 100 wasn’t like 103. People thought a toy train was a lot like a real train but that a real train was not like a toy train. People often thought that a son resembled his father, but if you asked them if the father resembled his son, they just looked at you strangely. [...] When people compared one thing to another—two people, two places, two numbers, two ideas—they did not pay much attention to symmetry. To Amos—and to no one else before Amos—it followed from this simple observation that all the theories that intellectuals had dreamed up to explain how people made similarity judgments had to be false.

The human mind was just bad at seeing things it did not expect to see, and a bit too eager to see what it expected to see. “Confirmation bias is the most insidious because you don’t even realize it is happening,” he said. A scout would settle on an opinion about a player and then arrange the evidence to support that opinion.

From his stint as a consultant he learned something valuable, however. It seemed to him that a big part of a consultant’s job was to feign total certainty about uncertain things. In a job interview with McKinsey, they told him that he was not certain enough in his opinions. “And I said it was because I wasn’t certain. And they said, ‘We’re billing clients five hundred grand a year, so you have to be sure of what you are saying.’” The consulting firm that eventually hired him was forever asking him to exhibit confidence when, in his view, confidence was a sign of fraudulence. They’d asked him to forecast the price of oil for clients, for instance. “And then we would go to our clients and tell them we could predict the price of oil. No one can predict the price of oil. It was basically nonsense.