[F08] Cognitive biases

Please answer this question first before proceeding

Namibia is a country in Africa. Do you know how big is Namibia's population? Is it above or below 100 million? Before you continue any further, write down your estimate of the population.

In this tutorial we will discuss cognitive biases. These are certain pervasive thinking habits which are likely to threaten objectivity or to lead to errors in reasoning. They are, however, often very common and difficult to get rid of them. Psychologists are interested in cognitive biases because they might tell us about human nature and how our brain is organised. Cognitive biases are obviously also relevant to many other areas, such as economics, management, advertising, education, and politics.

Back to the question about Namibia. Here is the answer:

Notice that a cognitive bias need not be a fallacy. The anchoring phenomenon just discussed does not seem to be a case where we have made an erroneous deduction. It is just that somehow our attempt to make a guess has been unconsciously influenced.

Cognitive biases are certain pervasive thinking habits which are likely to lead to errors in reasoning, but which seem to be a very common part of human psychology. The study of cognitive biases is a very important part of cognitive science and psychology, and relevant to many other areas, such as economics, management and education.

§1. Some examples of cognitive biases

• Confirmation bias: The tendency to look for information that confirms our existing preconceptions, making it more likely to ignore or neglect data that disconfirms our beliefs. For example, when we compare ourselves with others we are more likely to remember other people's mistakes and less likely to think of our own.
• Framing bias: The tendency to be influenced by the way in which a problem is formulated even though it should not affect the solution. Example: Whether a patient decides to go ahead with a surgery can be affected by whether the surgery is described in terms of success rate or rate of failure, even though both numbers provide the same information.
• Overconfidence effect (the above-average effect): Many people tend to over-estimate their abilities. Surveys across most areas of expertise indicate that more than half of the people think that they are better than the other half with respect to that expertise. For example, more than 50% of the population might think that they have above-average intelligence, but they cannot all be right. So many people tend to over-estimate their abilities and lack insight into their real performance.

§2. Biases relating to probability

Many cognitive biases are related to judgments and reasoning about probability and statistics. Here are some examples:

• Clustering illusion: The tendency to attribute patterns and underlying causes to random events when there are none.
• Gambler's fallacy: The error of thinking that a random event can be influenced by past random events. Example: Thinking that because a certain number has just come up in a lottery, it is less likely (or more likely) to come up in the next round.

§3. Other resourecs

• Here is a nice poster about some common cognitive biases: http://www.businessinsider.com.au/cognitive-biases-that-affect-decisions-2015-8

Here is a YouTube video about cognitive biases. There are many others in the channel: