Cognitive Bias - Revision history

Marcin: /* Reward & Punishment Superresponse Tendency */

2025-04-25T22:54:29Z

Reward & Punishment Superresponse Tendency

← Older revision		Revision as of 22:54, 25 April 2025
Line 19:		Line 19:
	Biases - Our aim is to help you realize what the biases are, how they are relevant to your life, and to give you resources to go deeper. (Of course, the ultimate resource is Charlie’s 500page book, [[Poor Charlie’s Almanack]]		Biases - Our aim is to help you realize what the biases are, how they are relevant to your life, and to give you resources to go deeper. (Of course, the ultimate resource is Charlie’s 500page book, [[Poor Charlie’s Almanack]]

			=False Consensus Bias=
			Thinking that everyone acts, thinks, behaves like you would. [https://en.m.wikipedia.org/wiki/False_consensus_effect#:~:text=In%20psychology%2C%20the%20false%20consensus,common%20and%20appropriate%20to%20existing]
			*Ex - for 20 years we have been thinking that is is easier to teach build skills to idealists than to teach idealism to builders. This seems not to be true. However, could this work at a younger age such as 18-22?
	=Reward & Punishment Superresponse Tendency=		=Reward & Punishment Superresponse Tendency=
	In Munger’s experience, people tend to be most motivated by incentives; especially by the right rewards. By understanding incentives, you can more effectively:		In Munger’s experience, people tend to be most motivated by incentives; especially by the right rewards. By understanding incentives, you can more effectively:
Line 39:		Line 42:
	*[[Drive: The Surprising Truth About What Motivates Us]]		*[[Drive: The Surprising Truth About What Motivates Us]]


	=Liking/Loving Tendency=		=Liking/Loving Tendency=
	Munger argues that we are wired to naturally favor people we like and love to the point of irrationality. In social psychology, this tendency is known as [[In-group Bias]]		Munger argues that we are wired to naturally favor people we like and love to the point of irrationality. In social psychology, this tendency is known as [[In-group Bias]]

Marcin: /* Excessive Self-Regard Tendency */

2020-10-11T00:16:36Z

Excessive Self-Regard Tendency

← Older revision		Revision as of 00:16, 11 October 2020
Line 283:		Line 283:
	*[[Managing Overconfidence]]		*[[Managing Overconfidence]]
	*[[The Winner Effect: The Neuroscience of Success and Failure]]		*[[The Winner Effect: The Neuroscience of Success and Failure]]

			=Links=
			*[[Mental Models]] and [[Faulty Mental Models]].

Marcin: /* Excessive Self-Regard Tendency */

2019-09-15T20:56:03Z

Excessive Self-Regard Tendency

← Older revision		Revision as of 20:56, 15 September 2019
Line 266:		Line 266:
	'''Quotes'''		'''Quotes'''
	*Man’s excess of self-regard typically makes him strongly prefer people like himself.” Munger. This is also known as [[Homophily]].		*Man’s excess of self-regard typically makes him strongly prefer people like himself.” Munger. This is also known as [[Homophily]].
	*Even man’s minor possessions tend to be over-appraised. Once owned, they		*Even man’s minor possessions tend to be over-appraised. Once owned, they suddenly become worth more to him than he would pay if they were offered for sale to him and he didn’t already own them.” Munger.
	suddenly become worth more to him than he would pay if they were offered for sale
	to him and he didn’t already own them.” Munger.
	*[A] man should try to face the two simple facts:		*[A] man should try to face the two simple facts:
	**Fixable but unfixed bad performance is bad character and tends to create more		**Fixable but unfixed bad performance is bad character and tends to create more of itself causing more damage to the excuse giver with each tolerated instance.
	of itself causing more damage to the excuse giver with each tolerated instance.
	**In demanding places, like athletic teams and General Electric, you are almost sure to be discarded in due course if you keep giving excuses instead of behaving as you should.” Munger		**In demanding places, like athletic teams and General Electric, you are almost sure to be discarded in due course if you keep giving excuses instead of behaving as you should.” Munger

	'''Antidotes'''		'''Antidotes'''
	*“Excesses of self-regard often cause bad hiring decisions because employers grossly		*“Excesses of self-regard often cause bad hiring decisions because employers grossly over appraise the worth of their own conclusions that rely on impressions in face-to-face contact. The correct antidote to this sort of folly is to under weigh face-to-face impressions and over weigh the applicant’s past record.” Munger
	over appraise the worth of their own conclusions that rely on impressions in
	face-to-face contact. The correct antidote to this sort of folly is to under weigh
	face-to-face impressions and over weigh the applicant’s past record.” Munger
	*“The main institutional antidotes to this part of the “Tolstoy effect” are:		*“The main institutional antidotes to this part of the “Tolstoy effect” are:
	**Offer meritocratic, demanding culture, plus personnel handling methods that		**Offer meritocratic, demanding culture, plus personnel handling methods that build up morale, and
	build up morale, and
	**Severance of the worst offenders.” Munger		**Severance of the worst offenders.” Munger
	*“The best antidote to folly from an excess of self-regard is to force yourself to be more		*“The best antidote to folly from an excess of self-regard is to force yourself to be more objective when you are thinking about yourself, your family and friends, your property, and the value of your past and future activity.”
	objective when you are thinking about yourself, your family and friends, your property,		*“Of all forms of useful pride, perhaps the most desirable is a justified pride in being trustworthy. Moreover, the trustworthy man, even after allowing for the inconveniences of his chosen course, ordinarily has a life that averages out better than he would have
	and the value of your past and future activity.”
	*“Of all forms of useful pride, perhaps the most desirable is a justified pride in being
	trustworthy. Moreover, the trustworthy man, even after allowing for the inconveniences
	of his chosen course, ordinarily has a life that averages out better than he would have
	if he provided less reliability.” Munger		if he provided less reliability.” Munger

Marcin: /* Excessive Self-Regard Tendency */

2019-09-15T20:52:17Z

Excessive Self-Regard Tendency

← Older revision		Revision as of 20:52, 15 September 2019
Line 259:		Line 259:

	=Excessive Self-Regard Tendency=		=Excessive Self-Regard Tendency=
	We are overconfident thinking we’re better than the average person. Several studies of		We are overconfident thinking we’re better than the average person. Several studies of selfperception, show that for any given trait, more than 50% of people think they’re above average from unsophisticated computer users who think they are cyber crime experts, to Harvard Business School students who think that they are [https://www.fool.com/archive/boringport/1999/09/20/foolcom-the-perils-of-investor-overconfidence-b.aspx better looking than everyone else]. This is known as the [[Endowment Effect]]. Being overconfident can lead to many shortcomings; for example, overconfident students do significantly poorer on tests.
	selfperception, show that for any given trait, more than 50% of people think they’re above
	average from unsophisticated computer users who think they are cyber crime experts, to
	Harvard Business School students who think that they are [https://www.fool.com/archive/boringport/1999/09/20/foolcom-the-perils-of-investor-overconfidence-b.aspx better looking than everyone else]. This is known as the
	[[Endowment Effect]]. Being overconfident can lead to many shortcomings; for example, overconfident students do significantly poorer on tests.

	The result of this is over-appraising things we own, decisions we make, and people like us		The result of this is over-appraising things we own, decisions we make, and people like us
Line 269:		Line 265:

	'''Quotes'''		'''Quotes'''
	*Man’s excess of self-regard typically makes him strongly prefer people like himself.” Munger. This is also known as [[~~Momophily~~]].		*Man’s excess of self-regard typically makes him strongly prefer people like himself.” Munger. This is also known as [[Homophily]].
	*Even man’s minor possessions tend to be over-appraised. Once owned, they		*Even man’s minor possessions tend to be over-appraised. Once owned, they
	suddenly become worth more to him than he would pay if they were offered for sale		suddenly become worth more to him than he would pay if they were offered for sale

Marcin: /* Excessive Self-Regard Tendency */

2019-09-15T20:21:21Z

Excessive Self-Regard Tendency

← Older revision		Revision as of 20:21, 15 September 2019
Line 263:		Line 263:
	average from unsophisticated computer users who think they are cyber crime experts, to		average from unsophisticated computer users who think they are cyber crime experts, to
	Harvard Business School students who think that they are [https://www.fool.com/archive/boringport/1999/09/20/foolcom-the-perils-of-investor-overconfidence-b.aspx better looking than everyone else]. This is known as the		Harvard Business School students who think that they are [https://www.fool.com/archive/boringport/1999/09/20/foolcom-the-perils-of-investor-overconfidence-b.aspx better looking than everyone else]. This is known as the
	[[Endowment Effect]]		[[Endowment Effect]]. Being overconfident can lead to many shortcomings; for example, overconfident students do significantly poorer on tests.
	. Being overconfident can lead to many shortcomings;
	for example, overconfident students
	do significantly poorer on tests
	.

	The result of this is ~~overappraising~~ things we own, decisions we make, and people like us		The result of this is over-appraising things we own, decisions we make, and people like us
	~~underappraising~~ things that challenge our ~~selfregard~~.		under-appraising things that challenge our self-regard.

	Quotes		'''Quotes'''
			*Man’s excess of self-regard typically makes him strongly prefer people like himself.” Munger. This is also known as [[Momophily]].
	Man’s excess of ~~selfregard~~ typically makes him strongly prefer people like himself.”		*Even man’s minor possessions tend to be over-appraised. Once owned, they
	Munger. This is also known as
	~~homophily~~
	.


	Even man’s minor possessions tend to be ~~overappraised~~. Once owned, they
	suddenly become worth more to him than he would pay if they were offered for sale		suddenly become worth more to him than he would pay if they were offered for sale
	to him and he didn’t already own them.” Munger.		to him and he didn’t already own them.” Munger.
			*[A] man should try to face the two simple facts:
	[A] man should try to face the two simple facts:		**Fixable but unfixed bad performance is bad character and tends to create more
	○ Fixable but unfixed bad performance is bad character and tends to create more
	of itself causing more damage to the excuse giver with each tolerated instance.		of itself causing more damage to the excuse giver with each tolerated instance.
	○ In demanding places, like athletic teams and		**In demanding places, like athletic teams and General Electric, you are almost sure to be discarded in due course if you keep giving excuses instead of behaving as you should.” Munger
	~~General~~ Electric
	, you are almost
	sure to be discarded in due course if you keep giving excuses instead of
	behaving as you should.” Munger

	Antidotes		'''Antidotes'''
	● “Excesses of ~~selfregard~~ often cause bad hiring decisions because employers grossly		*“Excesses of self-regard often cause bad hiring decisions because employers grossly
	over appraise the worth of their own conclusions that rely on impressions in		over appraise the worth of their own conclusions that rely on impressions in
	~~facetoface~~ contact. The correct antidote to this sort of folly is to under weigh		face-to-face contact. The correct antidote to this sort of folly is to under weigh
	~~facetoface~~ impressions and over weigh the applicant’s past record.” Munger		face-to-face impressions and over weigh the applicant’s past record.” Munger
			*“The main institutional antidotes to this part of the “Tolstoy effect” are:
	● “The main institutional antidotes to this part of the “Tolstoy effect” are:		**Offer meritocratic, demanding culture, plus personnel handling methods that

	○ Offer meritocratic, demanding culture, plus ~~personal~~ handling methods that
	build up morale, and		build up morale, and
	○ Severance of the worst offenders.” Munger		**Severance of the worst offenders.” Munger
			*“The best antidote to folly from an excess of self-regard is to force yourself to be more
	● “The best antidote to folly from an excess of ~~selfregard~~ is to force yourself to be more
	objective when you are thinking about yourself, your family and friends, your property,		objective when you are thinking about yourself, your family and friends, your property,
	and the value of your past and future activity.”		and the value of your past and future activity.”
			*“Of all forms of useful pride, perhaps the most desirable is a justified pride in being
	● “Of all forms of useful pride, perhaps the most desirable is a justified pride in being
	trustworthy. Moreover, the trustworthy man, even after allowing for the inconveniences		trustworthy. Moreover, the trustworthy man, even after allowing for the inconveniences
	of his chosen course, ordinarily has a life that averages out better than he would have		of his chosen course, ordinarily has a life that averages out better than he would have
	if he provided less reliability.” Munger		if he provided less reliability.” Munger

	Resources		Resources
	● Managing Overconfidence		*[[Managing Overconfidence]]
	● The Winner Effect: The Neuroscience of Success and Failure		*[[The Winner Effect: The Neuroscience of Success and Failure]]

Marcin: /* Pain-Avoiding Psychological Denial */

2019-09-15T20:15:47Z