Cognitive Biases, Errors of Judgement, and Fallacies Flashcards
(30 cards)
Basing your chances of success by looking at the successful few instead of the larger group of failures
e.g. overestimating your startup’s success because you heard of the success of a few startups
Survivorship Bias
Mistaking the causes of something to be its effect
e.g. people don’t get rich by pursuing MBAs they’re rich that’s why they pursue MBAs
Swimmer’s Body Illusion
Seeing patterns when there are actually none
e.g. seeing animals in the clouds or patterns in a group of random numbers
Clustering Illusion
Believing something to be true just because many other people believe it is true
Social Proof Phenomenon
Persisting on something, even if it is failing, because you’ve already invested too much time, effort, and money on it
e.g. persisting pursuing someone who doesn’t like you because you’ve already invested too much effort doing it
Sunk Cost Fallacy
Preference for information that confirm our beliefs, or discrediting facts that are contradictory
Confirmation Bias
Believing something is true just because an authority figure says so
Authority Bias
Overestimating the likelihood of events/things that are more striking or that easily come into mind
e.g. believing it’s more likely for you to die in a terrorist attack than to die from a heart attack
Availability Bias
Overestimating the expertise of someone who tells you that “things are going to get worse before they get better” - even if such a statement is intuitively and generally obvious
“It’ll Get Worse Before It Gets Better” Fallacy
The tendency of people who are indebted to others to do things that they normally wouldn’t do
e.g. you don’t normally invite your neighbors for dinner, but because they always invite you, you’re forced to do the same
Phenomenon of Reciprocity
The tendency for people to overestimate their predictive capabilities after-the-fact
Hindsight Bias
When wild, sensational stories are prioritized over dull, but relevant facts
Story Bias
Tendency for novices to be overconfident and to overestimate their knowledge/skills because they are unaware of their apparent lack of knowledge/skills
e.g. New pianists tend to overestimate their playing ability because they are still unaware of the breadth of technical knowledge and skill in piano playing
Dunning-Kruger Effect
Tendency for positive attributes of a person/place/event in one area to influence our thoughts, perceptions, feelings on another area
e.g. tendency to believe that physically attractive people are nicer/more generous than physically unattractive people
Halo Effect
Tendency for people to perceive skilled actors and smooth talkers as more competent on a topic than they actually are
Chauffeur Knowledge Effect
Tendency to believe that we have influence over something which we do not
Illusion of Control
Tendency of people to respond to incentives in a way that promotes their interests, rather than the incentive’s original intentions
Incentive super-response tendency
Phenomenon explaining why champions tend to not hold their titles the year after, and why the people at the bottom of the class are the most likely to improve in grades
Regression to the Mean
Phenomenon where having a lot of choices actually leads to higher chances of no choices being made
Paradox of Choice
Tendency to like people who like us also
Liking Bias
Tendency of people to put a higher value on things once they own them, even if their value actually depreciates
Endowment Effect
Tendency to respond to the magnitude of an event, and not on its probability/likelihood
Neglect of Probability
Tendency to put a higher value on things once we know that it is the last piece/a rare piece
Scarcity Error
When we are deprived of an option, we find it more attractive
Reactance / “Romeo and Juliet” Effect
