'Gut Feelings' by Gerd Gigerenzer

I picked this book up randomly in the St. George book-store in Prenzlauer Berg, and flipped it open randomly and read a few pages. In those few pages I found, distilled into clear and patently true critiques, all the vague distaste I had felt for Dan Ariely’s brand of behavioural economics and the essentially arrogant attitude that humans are ‘irrational’ - an attitude that has pervaded the discipline since Kahnemann declared people logically impaired for rating a woman more likely to be a vegetarian banker than a banker.
The book has weak points, conceptually, and it is also written with the slightly clumsy amateurish prose of an academic writing for the lay populace, but for that it is quite remarkable among pop science for being quite clearly founded upon a deep regard for the intelligence of humans and for the immense complexity of this intelligence in the decisions they make.
The title of the book, and its subtitle (‘Short Cuts to Better Decision Making’) make for a first impression of a self-help guide. And indeed, there are a few forays in this direction in the weaker chapters , but in fact this book does not belong in the self-help aisle, nor even necessarily in pop-science. It is a book about psychology and its primary drive is to reclaim respect for intuition.
In it are several items of common sense which are not at all common, and only common sense in hindsight. The first and foremost is that what we call gut instinct is, of course, a set of finely honed cognitive processes, adaptive and crucial to allow any decision making at all in an infinitely complex world. Second and more subtly is that these instincts are not merely necessary compromises that can always be improved upon by careful scientific - ‘rational’ - analysis but quite often actually superior to a detached logical approach.
A point that occurred to me in the reading of this book, was that many of the claims of Ariely, Kahnemann and clan, are examples, essentially of observation bias : nowhere in their writing will you find examples of where a rational analysis of a particular decision is inferior to that of a human embedded in that decision making context. How laughable it would be to collect such examples, because they are infinite. Most mathematical models of human behaviour are not only wrong but hopelessly ridiculously wrong. Of course, in amongst the myriad of different decisions people make every day, there will occasionally be one or two which can be found to be systematically suboptimal compared to a carefully formulated algorithm. Mostly these are only inferior in very restricted contexts such as the laboratory of the rational scientists, and even granting the existence of some very particular examples of ‘irrational’ behaviour, these examples are woefully overwhelmed by the examples where a ‘rational’ approach would be so stupid a 2-year old would recognise the folly.
Much of this critique can perhaps be condensed into the point that Ariely and co. simply confound two homonyms: rational, as a very precise concept of game theory; and rational, as an almost-synonym for sensible in common speech. By reducing a particular decision’s context to that which is readily describable in terms of mathematical rationality, they suck out the nuance and complexity within which the human brain evolved over the ages. Then, if the subjects do not conform to the strictly defined game-theoretic rational choice – as evidence of common-speech irrationality: look how silly we can be, they cry!