Nudge economics: has push come to shove for a fashionable theory? | Science | The Observer

In an increasingly complex and specialised world, Gigerenzer preaches a gospel of greater simplicity. He suggests that the outcome of decisions of any complexity – a complexity of, say, trying to organise a successful picnic or greater – are impossible to accurately predict with any mathematical rational model, and therefore more usefully approached with a mixture of gut instinct and what he calls heuristics, the learned rules of thumb of any given situation. He believes, and he has some evidence to prove it, that such judgments prove sounder in practice than those based purely on probability.Gerd Gigerenzer, who believes that, with education, the teaching of critical thinking about statistical probability, people can become more usefully risk savvy."This is not," Gigerenzer concedes, "an easy message to convey to economists, who have been trained in optimisation techniques or to managers in corporations who believe that one can maximise every decision." There are, too, plenty of people who have a vested interest in preserving the idea that the future is complex but calculable, even if in most cases they know that the illusion of certainty that they present is untrue.In Gigerenzers view this group includes much of the medical profession, most financial analysts and advisers, and, of course, many academics. The desire for ever greater complexity in the process of decision-making, driven by ever greater access to data, in practice produces what he calls risk-averse "defensive decision-making", or covering your backside. You dont do what your instinct and experience tells you is right: you find the data to support an inferior, but less personally risky choice.

via Nudge economics: has push come to shove for a fashionable theory? | Science | The Observer.

Print Friendly, PDF & Email

Leave a Reply

Your email address will not be published. Required fields are marked *