Author: Barry Schwartz
ISBN: 978-0062449924
The dark side of being able to choose (too much).
EXCERPTS
The fact that some choice is good doesn’t necessarily mean that more choice is better.
As a culture, we are enamored of freedom, self-determination, and variety, and we are reluctant to give up any of our options. But clinging tenaciously to all the choices available to us contributes to bad decisions, to anxiety, stress, and dissatisfaction—even to clinical depression.
We do ourselves no favor when we equate liberty too directly with choice, as if we necessarily increase freedom by increasing the number of options available. Instead, I believe that we make the most of our freedoms by learning to make good choices about the things that matter, while at the same time unburdening ourselves from too much concern about the things that don’t.
Choosing well is especially difficult for those determined to make only the best choices, individuals I refer to as “maximizers.”
Several psychological processes that explain why added options do not make people better off: adaptation, regret, missed opportunities, raised expectations, and feelings of inadequacy in comparison with others.
I will argue that: We would be better off if we embraced certain voluntary constraints on our freedom of choice, instead of rebelling against them. We would be better off seeking what was “good enough” instead of seeking the best.
We would be better off if we lowered our expectations about the results of decisions. We would be better off if the decisions we made were nonreversible. We would be better off if we paid less attention to what others around us were doing.
When it came to buying, however, a huge difference became evident. Thirty percent of the people exposed to the small array of jams actually bought a jar; only 3 percent of those exposed to the large array of jams did so. The key results of this study were that the students faced with the small array were more satisfied with their tasting than those faced with the large array. In addition, they were four times as likely to choose chocolate rather than cash as compensation for their participation.
A large array of options may discourage consumers because it forces an increase in the effort that goes into making a decision. So consumers decide not to decide, and don’t buy the product. Or if they do, the effort that the decision requires detracts from the enjoyment derived from the results. Also, a large array of options may diminish the attractiveness of what people actually choose, the reason being that thinking about the attractions of some of the unchosen options detracts from the pleasure derived from the chosen one.
When experiencing dissatisfaction or hassle on a shopping trip, consumers are likely to blame it on something else—surly salespeople, traffic jams, high prices, items out of stock—anything but the overwhelming array of options.
Gawande reports that research has shown that patients commonly prefer to have others make their decisions for them. Though as many as 65 percent of people surveyed say that if they were to get cancer, they would want to choose their own treatment, in fact, among people who do get cancer, only 12 percent actually want to do so. What patients really seem to want from their doctors, Gawande believes, is competence and kindness. Kindness of course includes respect for autonomy, but it does not treat autonomy as an inviolable end in itself.
This kind of job mobility offers many opportunities. Being able to move around, changing employers and even careers, opens doors to challenging and fulfilling options. But it comes at a price, and the price is the daily burden of gathering information and making decisions. People can never relax and enjoy what they have already achieved. At all times, they have to stay alert for the next big chance.
What we remember about the pleasurable quality of our past experiences is almost entirely determined by two things: how the experiences felt when they were at their peak (best or worst), and how they felt when they ended. This “peak-end” rule of Kahneman’s is what we use to summarize the experience, and then we rely on that summary later to remind ourselves of how the experience felt. The summaries in turn influence our decisions about whether to have that experience again, and factors such as the proportion of pleasure to displeasure during the course of the experience or how long the experience lasted, have almost no influence on our memory of it.
So it seems that neither our predictions about how we will feel after an experience nor our memories of how we did feel during the experience are very accurate reflections of how we actually do feel while the experience is occurring. And yet it is memories of the past and expectations for the future that govern our choices.
Several studies have demonstrated that “familiarity breeds liking.” If you play snippets of music for people or show them slides of paintings and vary the number of times they hear or see the music and the art, on the whole people will rate the familiar things more positively than the unfamiliar ones. When products are essentially equivalent, people go with what’s familiar, even if it’s only familiar because they know its name from advertising.
Unfortunately, most people give substantial weight to this kind of anecdotal “evidence,” perhaps so much so that it will cancel out the positive recommendation found in Consumer Reports. Most of us give weight to these kinds of stories because they are extremely vivid and based on a personal, detailed, face-to-face account.
“In general, the more often we encounter something, the easier it is for us to recall it in the future. Because I had an easier time recalling words that start with t than recalling words with t as the third letter, I must have encountered them more often in the past. So there must be more words in English that start with t than have it as the third letter.” But your conclusion would be wrong.
The availability heuristic says that we assume that the more available some piece of information is to memory, the more frequently we must have encountered it in the past. This heuristic is partly true. In general, the frequency of experience does affect its availability to memory. But frequency of experience is not the only thing that affects availability to memory. Salience or vividness matters as well. [If interested in heuristics, read Thinking Fast and Slow by Danial Kahneman and or The Undoing Project by Michael Lewis]
In general, dramatic, vivid causes of death (accident, homicide, tornado, flood, fire) were overestimated, whereas more mundane causes of death (diabetes, asthma, stroke, tuberculosis) were underestimated.
What he finds, again and again, is that the group predictions are better than the predictions of any individual. In 1998, for example, the group picked eleven out of twelve Oscar winners, while the average individual in the group picked only five out of twelve, and even the best individual picked only nine.
In a store that displays suits costing over $1,500, an $800 pinstripe may seem like a good buy. But in a store in which most of the suits cost less than $500, that same $800 suit might seem like an extravagance. So which is it, a good buy or a self-indulgence? Unless you’re on a strict budget, there are no absolutes. In this kind of evaluation, any particular item will always be at the mercy of the context in which it is found.
One high-end catalog seller of mostly kitchen equipment and gourmet foods offered an automatic bread maker for $279. Sometime later, the catalog began to offer a larger capacity, deluxe version for $429. They didn’t sell too many of these expensive bread makers, but sales of the less expensive one almost doubled! With the expensive bread maker serving as an anchor, the $279 machine had become a bargain.
Anchoring is why department stores seem to have some of their merchandise on sale most of the time, to give the impression that customers are getting a bargain. The original ticket price becomes an anchor against which the sale price is compared.
Even if companies sell almost none of their highest-priced models, they can reap enormous benefits from producing such models because they help induce people to buy their cheaper (but still extremely expensive) ones.
It seems to be a fairly general principle that when making choices among alternatives that involve a certain amount of risk or uncertainty, we prefer a small, sure gain to a larger, uncertain one. Most of us, for example, will choose a sure $100 over a coin flip (a fifty-fifty chance) that determines whether we win $200 or nothing. When the possibilities involve losses, however, we will risk a large loss to avoid a smaller one. For example, we will choose a coin flip that determines whether we lose $200 or nothing over a sure loss of $100. [Check out the prospect theory graph.]
When there is a difference in price between cash and credit at the gas station, is it a discount for cash or a surcharge for credit? If you think it’s a discount for cash, then you’re setting your neutral point at the credit-card price and paying cash is a gain. If you think it’s a surcharge, then you’re setting your neutral point at the cash price, and using your credit card is a loss. So fairly subtle manipulations of wording can affect what the neutral point is and whether we are thinking in terms of gains or losses. And these manipulations will in turn have profound effects on the decisions.
This phenomenon is called the endowment effect. Once something is given to you, it’s yours. Once it becomes part of your endowment, even after a very few minutes, giving it up will entail a loss. And, as prospect theory tells us, because losses are more bad than gains are good, the mug or pen with which you have been “endowed” is worth more to you than it is to a potential trading partner. And “losing” (giving up) the pen will hurt worse than “gaining” (trading for) the mug will give pleasure. Thus, you won’t make the trade.
The endowment effect helps explain why companies can afford to offer money-back guarantees on their products. Once people own them, the products are worth more to their owners than the mere cash value, because giving up the products would entail a loss.
Economist Richard Thaler provides another example of sunk costs that I suspect many people can identify with. You buy a pair of shoes that turn out to be really uncomfortable. What will you do about them? Thaler suggests: The more expensive they were, the more often you’ll try to wear them. Eventually, you’ll stop wearing them, but you won’t get rid of them. And the more you paid for them, the longer they’ll sit in the back of your closet. At some point, after the shoes have been fully “depreciated” psychologically, you will finally throw them away.
Even with relatively unimportant decisions, mistakes can take a toll. When you put a lot of time and effort into choosing a restaurant or a place to go on vacation or a new item of clothing, you want that effort to be rewarded with a satisfying result. As options increase, the effort involved in making decisions increases, so mistakes hurt even more. Thus the growth of options and opportunities for choice has three, related, unfortunate effects. It means that decisions require more effort. It makes mistakes more likely. It makes the psychological consequences of mistakes more severe.
Finally, the very wealth of options before us may turn us from choosers into pickers. A chooser is someone who thinks actively about the possibilities before making a decision.
A picker does none of these things. With a world of choices rushing by like a music video, all a picker can do is grab this or that and hope for the best.
CHOOSING WISELY BEGINS WITH DEVELOPING A CLEAR UNDERSTANDING of your goals. And the first choice you must make is between the goal of choosing the absolute best and the goal of choosing something that is good enough.
If you seek and accept only the best, you are a maximizer. Maximizers need to be assured that every purchase or decision was the best that could be made. Yet how can anyone truly know that any given option is absolutely the best possible? The only way to know is to check out all the alternatives. A maximizer can’t be certain that she has found the best sweater unless she’s looked at all the sweaters. She can’t know that she is getting the best price unless she’s checked out all the prices.
The alternative to maximizing is to be a satisficer. To satisfice is to settle for something that is good enough and not worry about the possibility that there might be something better. A satisficer has criteria and standards. She searches until she finds an item that meets those standards, and at that point, she stops. As soon as she finds a sweater that meets her standard of fit, quality, and price in the very first store she enters, she buys it—end of story. She is not concerned about better sweaters or better bargains just around the corner.
To a maximizer, satisficers appear to be willing to settle for mediocrity, but that is not the case. A satisficer may be just as discriminating as a maximizer. The difference between the two types is that the satisficer is content with the merely excellent as opposed to the absolute best.
The goal of maximizing is a source of great dissatisfaction, that it can make people miserable. People with high maximization scores experienced less satisfaction with life, were less happy, were less optimistic, and were more depressed than people with low maximization scores. In fact, people with extreme maximization scores—scores of 65 or more out of 91—had depression scores that placed them in the borderline clinical depression range.
How to satisfice is an important step not only in coping with a world of choice but in simply enjoying life.
Whereas maximizers might do better objectively than satisficers, they tend to do worse subjectively.
So we have to ask ourselves what counts when we assess the quality of a decision. Is it objective results or subjective experiences? What matters to us most of the time, I think, is how we feel about the decisions we make. When economists theorize about how consumers operate in the market, they assume that people seek to maximize their preferences, or their satisfaction. What becomes clear about “satisfaction” or “preferences” as they are experienced in real life is that they are subjective, not objective. Getting the best objective result may not be worth much if we feel disappointed with it anyway.
I have interacted with college students for many years as a professor, and in my experience, students who think they’re in the right place get far more out of a particular school than students who don’t. Conviction that they have found a good fit makes students more confident, more open to experience, and more attentive to opportunities.
I’m not saying that satisficers do not have standards. Satisficers may have very high standards. It’s just that they allow themselves to be satisfied once experiences meet those standards.
Following Herbert Simon’s reasoning, some might argue that my description of maximizers is actually a description of people who don’t truly understand what it means to “maximize.” A real maximizer would figure in the costs (in time and money and stress) of gathering and assessing information. An exhaustive search of the possibilities, which entails enormous “information costs,” is not the way to maximize one’s investment. The true maximizer would determine just how much information seeking was the amount needed to lead to a very good decision. The maximizer would figure out when information seeking had reached the point of diminishing returns. And at that point, the maximizer would stop the search and choose the best option. But maximizing is not a measure of efficiency. It is a state of mind. If your goal is to get the best, then you will not be comfortable with compromises dictated by the constraints imposed by reality. You will not experience the kind of satisfaction with your choices that satisficers will. In every area of life, you will always be open to the possibility that you might find something better if you just keep looking.
Maximizing and perfectionism are not interchangeable. A perfectionist is not satisfied doing a “good enough” job if he or she can do better. Thus perfectionists, like maximizers, seek to achieve the best. But I think there is an important difference between them. While maximizers and perfectionists both have very high standards, I think that perfectionists have very high standards that they don’t expect to meet, whereas maximizers have very high standards that they do expect to meet. Which may explain why we found that those who score high on perfectionism, unlike maximizers, are not depressed, regretful, or unhappy. Perfectionists may not be as happy with the results of their actions as they should be, but they seem to be happier with the results of their actions than maximizers are with the results of theirs.
When I finally make a choice, I think about the items I’ve passed up. I second-guess myself, and I often regret my decision, not because it turns out badly, but because I suspect that a different decision might have turned out better. All of which clearly diminishes the satisfaction I get from the choices I actually make.
The truth is that maximizing and satisficing orientations tend to be “domain specific.” Nobody is a maximizer in every decision, and probably everybody is in some. Perhaps what distinguishes maximizers from satisficers is the range and number of decisions in which an individual operates as one or the other. This is good news, because what it means is that most of us have the capacity to be satisficers. The task, then, for someone who feels overwhelmed by choices, is to apply the satisficing strategy more often, letting go of the expectation that “the best” is attainable.
Hirsch suggested that the more affluent a society becomes, and the more basic material needs are met, the more people care about goods that are inherently scarce. And if you’re in competition for inherently scarce goods, “good enough” is never good enough; only the best—only maximization—will do.
It is possible that a wide array of options can turn people into maximizers. If this is true, then the proliferation of options not only makes people who are maximizers miserable, but it may also make people who are satisficers into maximizers.
Studies comparing the well-being of people living in different cultures have shown that substantial differences between cultures in the consumption opportunities they make available to people have very small effects on peoples’ satisfaction with their lives.
What looks attractive in prospect doesn’t always look so good in practice. In making a choice that could mean the difference between life and death, figuring out which choice to make becomes a grave burden.
To avoid the escalation of such burdens, we must learn to be selective in exercising our choices. We must decide, individually, when choice really matters and focus our energies there, even if it means letting many other opportunities pass us by. The choice of when to be a chooser may be the most important choice we have to make.
And one of the things these surveys tell us is that, not surprisingly, people in rich countries are happier than people in poor countries. Obviously, money matters. But what these surveys also reveal is that money doesn’t matter as much as you might think. Once a society’s level of per capita wealth crosses a threshold from poverty to adequate subsistence, further increases in national wealth have almost no effect on happiness. You find as many happy people in Poland as in Japan, for example, even though the average Japanese is almost ten times richer than the average Pole. And Poles are much happier than Hungarians (and Icelandics much happier than Americans) despite similar levels of wealth.
If, instead of looking at happiness across nations at a given time, we look within a nation at different times, we find the same story. In the last forty years, the per capita income of Americans (adjusted for inflation) has more than doubled. The percentage of homes with dishwashers has increased from 9 percent to 50 percent. The percentage of homes with clothes dryers has increased from 20 percent to 70 percent. The percentage of homes with air-conditioning has increased from 15 percent to 73 percent. Does this mean we have more happy people? Not at all. Even more striking, in Japan, per capita wealth has increased by a factor of five in the last forty years, again with no measurable increase in the level of individual happiness.
But if money doesn’t do it for people, what does? What seems to be the most important factor in providing happiness is close social relations. People who are married, who have good friends, and who are close to their families are happier than those who are not. People who participate in religious communities are happier than those who do not. Being connected to others seems to be much more important to subjective well-being than being rich. But a word of caution is in order. We know with certainty that there is a relation between being able to connect socially and being happy. It is less clear, however, which is the cause and which is the effect. Miserable people are surely less likely than happy people to have close friends, devoted family, and enduring marriages. So it is at least possible that happiness comes first and close relations come second. What seems likely to me is that the causality works both ways: happy people attract others to them, and being with others makes people happy.
In the context of this discussion of choice and autonomy, it is also important to note that, in many ways, social ties actually decrease freedom, choice, and autonomy. Marriage, for example, is a commitment to a particular other person that curtails freedom of choice of sexual and even emotional partners. And serious friendship imposes a lasting hold on you. To be someone’s friend is to undertake weighty responsibilities and obligations that at times may limit your own freedom. The same is true, obviously, of family. So, counterintuitive as it may appear, what seems to contribute most to happiness binds us rather than liberates us. How can this notion be reconciled with the popular belief that freedom of choice leads to fulfillment?
We earn more and spend more, but we spend less time with others. More than a quarter of Americans report being lonely, and loneliness seems to come not from being alone, but from lack of intimacy. We spend less time visiting with neighbors. We spend less time visiting with our parents, and much less time visiting with other relatives.
Time spent dealing with choice is time taken away from being a good friend, a good spouse, a good parent, and a good congregant.
Establishing and maintaining meaningful social relations requires a willingness to be bound or constrained by them, even when dissatisfied.
If you adopt the rule that you will never cheat on your partner, you will eliminate countless painful and tempting decisions that might confront you later on. Having the discipline to live by the rules you make for yourself is, of course, another matter, but one thing’s for sure: following rules eliminates troublesome choices in your daily life, each time you go to a cocktail party.
One of the “costs” of any option involves passing up the opportunities that a different option would have afforded. This is referred to as an opportunity cost.
According to standard economic assumptions, the only opportunity costs that should figure into a decision are the ones associated with the next-best alternative. Pay attention to what you’re giving up in the next-best alternative, but don’t waste energy feeling bad about having passed up an option further down the list that you wouldn’t have gotten to anyway. This advice, however, is extremely difficult to follow, and here’s why: The options under consideration usually have multiple features. If people think about options in terms of their features rather than as a whole, different options may rank as second best (or even best) with respect to each individual feature. So going to the movies may be the best way to stimulate the intellect. Listening to jazz may be the best way to relax. Dancing may be the most enjoyable way to get some exercise. Going to the ball game may be the best way to blow off some steam. Dinner at home with friends may be the best way to experience intimacy. Even though there may be a single, second-best option overall, each of the options you reject has some very desirable feature on which it beats its competition. So going out to dinner then means giving up opportunities to be intellectually stimulated, to relax, to get exercise, to blow off steam, and to experience intimacy. Psychologically, each alternative you consider may introduce still another opportunity you’ll have to pass up if you choose your preferred option. If we assume that opportunity costs take away from the overall desirability of the most-preferred option and that we will feel the opportunity costs associated with many of the options we reject, then the more alternatives there are from which to choose, the greater our experience of the opportunity costs will be. And the greater our experience of the opportunity costs, the less satisfaction we will derive from our chosen alternative.
The existence of multiple alternatives makes it easy for us to imagine alternatives that don’t exist—alternatives that combine the attractive features of the ones that do exist. And to the extent that we engage our imaginations in this way, we will even less satisfied with the alternative we end up choosing.
What then do people do, if virtually all decision involve trade-offs and people resist making them? One option is to postpone or avoid the decision.
Faced with one attractive option, two-thirds of people are willing to go for it. But faced with two attractive options, only slightly more than half are willing to buy. Adding the second option creates a conflict, forcing a trade-off between price and quality. Without a compelling reason to go one way or the other, potential consumers pass up the sale altogether. By creating the conflict, this second option makes it harder, not easier to make a choice.
Consumers need or want reasons to justify choices, as we see in a third hypothetical situation. A similar one-day sale offers the $99 Sony and an inferior Aiwa at the list price of $105. Here, the added option does not create conflict. The Sony is better than the AIWA and it’s on sale. Not surprisingly, almost no one chooses the Aiwa. Surprisingly, however, 73 percent go with the Sony, as opposed to 66 percent when it was offered by itself. So the presence of a clearly inferior alternative makes it easier for consumers to take the plunge.
Difficult trade-offs make it difficult to justify decisions, so decisions are deferred; easy trade-offs make it easy to justify decisions. And single options lie somewhere in the middle.
Conflict induces people to avoid decisions even when the stakes are trivial.
Based on these studies, and others like them, researchers concluded that when people are presented with options involving trade-offs that create conflict, all choices begin to look unappealing.
We want our investment advisers carefully considering trade-offs before making investment recommendations. We want Consumer Reports to evaluate trade-offs before making purchasing recommendations. We just don’t want to have to evaluate trade-offs ourselves. And we don’t want to do it because it is emotionally unpleasant to go through the process of thinking about opportunity costs and the losses they imply. [People pay us to make decisions for them!]
When we are in a good mood, we think better. We consider more possibilities; we’re open to considerations that would otherwise not occur to us; we see subtle connections between pieces of information that we might otherwise miss.
As the number of options under condiseration goes up and the attractive features associated with the rejected alternatives accumulate, the satisfaction derived from the chosen alternative will go down. This is one reason, and a very important one, why adding options can be detrimental to our well-being. Because we don’t put rejected options out of our minds, we experience the disappointment of having our satisfaction with decisions diluted by all the options we considered but did not choose.
The larger display of samples attracted more shoppers, but these individuals did not sample more different jams. Remarkably, shoppers who saw the larger display were less likely actually to buy jam than those who saw the smaller display. Much less likely.
Now whose fault will it be if I bring back something that people regard as a waste of time? Now it is no longer a reflection of the quality of the store. Now it’s a reflection of the quality of my taste. So the availability of many attractive options means that there is no longer any excuse for failure. The blame for a bad choice will rest squarely with me, and the stakes involved in my video choice have escalated.
When people are asked to give reasons for their preferences, they may struggle to find the words. Sometimes aspects of their reaction that are not the most important determinants of their overall feeling are nonetheless easiest to verbalize. People may have less trouble expressing why one poster is funnier than another than why the van Gogh print is more beautiful than the Monet. So they grasp at what they can say, and identify it as the basis for their preference. But once the words are spoken, they take on added significance to the person who spoke them. At the moment of choice, these explicit, verbalized reasons weigh heavily in the decision. As time passes, the reasons that people verbalized fade into the background, and people are left with their unarticulated preferences, which wouldn’t have steered them to the poster they chose. As the salience of the verbalized reasons fades, so, too, does people’s satisfaction with the decision they made.
When students who had been asked to analyze their relationships were compared to students not asked to do so, the researchers found that unanalyzed attitudes about the relationship were a better predictor of whether the relationship would still be intact months later than analyzed attitudes. Those who were asked to supply reasons and expressed positive feelings about their relationship were not necessarily still in the relationship six months later. As in the poster study, being asked to give reasons can make unimportant considerations salient temporarily and produce a less, not a more, accurate assessment of how people really feel.
Whereas delaying marriage and avoiding commitment to a particular job would seem to promote self-discovery, this freedom and self-exploration seems to leave many people feeling more lost than found. And as one young respondent put it, “What happens when you have too many options is that you are responsible for what happens to you.”
Reversible Decisions: An Illusory Solution to the Choice Problem
What emerged from the findings was that, while participants valued being able to reverse their choices, almost no one actually did so. However, those who had the option to change their minds were less satisfied with their choices than participants who did not have that option. And, perhaps most important, the participants had no idea that keeping the option open to change their minds would affect their satisfaction with the things they chose.
Or, to raise the stakes, consider the possible difference between those who regard marital vows as sacred and unbreakable and those who regard them as agreements that can be reversed or undone by mutual consent. We would expect that those who see marriage as a nonreversible commitment will be more inclined to do psychological work that makes them feel satisfied with their decision than will those whose attitude about marriage is more relaxed. As a result, individuals with “nonreversible” marriages might be more satisfied than individuals with “reversible” ones. As we see reversible marriages come apart, we may think to ourselves, how fortunate the couple was to have a flexible attitude toward marital commitment, given that it didn’t work out. It might not occur to us that the flexible attitude might have played a causal role in the marriage’s failure. [The guy is bringing fort marital commitments too many times. It makes me wonder whether he's satisfied :)]
But the problem of trade-offs and opportunity costs will be dramatically attenuated for a satisficer. Recall that satisficers are looking for something that’s “good enough,” not something that’s best. “Good enough” can survive thinking about opportunity costs. In addition, the “good enough” standard likely will entail much less searching and inspection of alternatives than the maximizer’s “best” standard. With fewer alternatives under consideration, there will be fewer opportunity costs to be subtracted. Finally, a satisficer is not likely to be thinking about the hypothetical perfect world, in which options exist that contain all the things they value and trade-offs are unnecessary. For all these reasons, the pain of making trade-offs will be especially acute for maximizers. Indeed, I believe that one of the reasons that maximizers are less happy, less satisfied with their lives, and more depressed than satisficers is precisely because the taint of trade-offs and opportunity costs washes out much that should be satisfying about the decisions they make.
Postdecision regret is sometimes referred to as “buyer’s remorse.” After a purchasing decision, we start to have second thoughts, convincing ourselves that rejected alternatives were actually better than the one we chose, or imagining that there are better alternatives out there that we haven’t yet explored. The bitter taste of regret detracts from the satisfaction we get, whether or not the regret is justified. Anticipated regret is in many ways worse, because it will produce not just dissatisfaction but paralysis. If someone asks herself how it would feel to buy this house only to discover a better one next week, she probably won’t buy this house.
Anticipated regret will make decisions harder to make, and postdecision regret will make them harder to enjoy.
The omission bias undergoes a reversal with respect to decisions made in the more distant past. When asked about what they regret most in the last six months, people tend to identify actions that didn’t meet expectations. But when asked about what they regret most when they look back on their lives as a whole, people tend to identify failures to act.
When you miss your objective by a lot, it is hard to imagine that small differences would have led to a successful result. But when you miss by a little, ouch.
Related to this “nearness” effect, who do you think is happier, an athlete who wins a silver medal in the Olympics (second place) or an athlete who wins a bronze medal (third place)? It seems obvious that second is better than third, so silver medalists should be happier than bronze medalists. But this turns out, on average, not to be true. Bronze medalists are happier than silver medalists. As the silver medalists stand on the award platform, they’re thinking about how close they came to winning the gold. Just a little more of this, and a little less of that, and ultimate glory would have been theirs. As the bronze medalists stand on that platform, however, they’re thinking about how close they came to getting no medal at all. The near miss of the silver medalists is triumph, whereas the near miss of the bronze medalists is also-ran obscurity.
The last important determinant of regret is responsibility. If a friend invites you out to dinner at a restaurant of his choosing and you have a bad meal, you might be disappointed. You might be displeased. But will you be regretful? What is it that you’ll regret? Contrast that with how you’ll feel after a bad meal if you picked the restaurant. This is when you’ll feel regret. Several studies have shown that bad results make people equally unhappy whether or not they are responsible for them. But bad results make people regretful only if they bear responsibility.
If we put these factors together, we get a picture of the conditions that make regret especially powerful. If we are responsible for an action that turns out badly and if it almost turned out well, then we are prime candidates for regret.
And what makes the problem of regret much worse is that such thinking is not restricted to objective reality. The power of the human imagination enables people to think about states of affairs that don’t exist. When confronted with a choice between a job that offers the possibility of rapid advancement and a job that offers congenial workmates, I can easily imagine finding a job that has both. This ability to conjure up ideal scenarios provides a never-ending supply of raw material for experiencing regret.
People hold on to stocks that have decreased in value because selling them would turn the investment into a loss. What should matter in decisions about holding or selling stocks is only your assessment of future performance and not (tax considerations aside) the price at which the stocks were purchased.
Full-price payers were more likely to show up at performances than discount payers. The reason for this, the researchers argued, was that the full-price payers would feel worse about wasting money if they didn’t use the tickets than would the discount payers. Because it would constitute a bigger loss for the full-price payers, failure to attend a performance would produce more regret.
From the perspective of a model of decision making that is future oriented, being sensitive to sunk costs is a mistake. The tickets are bought, and the money is spent. That’s over. The only question the ticket holders should be asking themselves on the night of the performance is, “Will I get more satisfaction out of a night at the theater or out of a night spent reading and listening to music at home?” But people don’t operate this way. Sunk-cost effects have been demonstrated in a variety of different settings. In one study, respondents were asked to imagine having purchased nonrefundable tickets for two ski trips to different places, only to discover that the trips are on the same day. One ticket cost $50 and the other cost $25, but there is good reason to think that they’ll have a better time on the $25 trip. Which one do people choose to go on? For the most part, they choose the $50 trip. According to the same logic of sunk costs, professional basketball coaches give more playing time to players earning higher salaries, independent of their current level of performance. And people who have started their own businesses are more likely to invest in expanding them than people who have purchased their businesses from others. Again, in both of these cases, what “should” matter are the prospects for future performance—of the business or of the player. But what also seems to matter is the level of previous investment.
I, personally, succumb to sunk-cost effects in a variety of settings that I’m aware of, and probably many others that I’m not. I have clothes in my closet and CDs on my rack that I know I’m not going to wear or listen to again. Yet I can’t get rid of them. When I eat in a restaurant, I feel compelled to finish what’s on my plate, no matter how full I am. When I’m two hundred pages into reading a book, I force myself to finish it, no matter how little I’m enjoying it or learning from it. The list goes on and on.
Many people persist in very troubled relationships not because of love or what they owe the other person or because they feel a moral obligation to honor vows, but because of all the time and effort they’ve already put in. How many people stick out an arduous course of training, like, say, medical school, even after they discover that they really don’t want to be doctors?
It should also be clear that the problem of regret will loom larger for maximizers than for satisficers. No matter how good something is, if a maximizer discovers something better, he’ll regret having failed to choose it in the first place.
Adaptation. Simply put, we get used to things, and then we start to take them for granted.
Human beings, Scitovsky said, want to experience pleasure. And when they consume, they do experience pleasure—as long as the things they consume are novel. But as people adapt—as the novelty wears off—pleasure comes to be replaced by comfort.
Comfort is nice enough, but people want pleasure. And comfort isn’t pleasure. The result of having pleasure turn into comfort is disappointment, and the disappointment will be especially severe when the goods we are consuming are “durable” goods, such as cars, houses, stereo systems, elegant clothes, jewelry, and computers.
Faced with this inevitable disappointment, what do people do? Some simply give up the chase and stop valuing pleasure derived from things. Most are driven instead to pursue novelty, to seek out new commodities and experiences whose pleasure potential has not been dissipated by repeated exposure. In time, these new commodities also will lose their intensity, but people still get caught up in the chase, a process that psychologists Philip Brickman and Donald Campbell labeled the hedonic treadmill. No matter how fast you run on this kind of machine, you still don’t get anywhere. And because of adaptation, no matter how good your choices and how pleasurable the results, you still end up back where you started in terms of subjective experience.
Amazingly, with the passage of time, there was no difference in reported well-being between professors who had been awarded tenure and those who had been passed over for the lifetime appointment. Even with adaptation in mind, the predictors substantially overestimated how good a positive decision would make them feel and how bad a negative decision would make them feel in the long run.
If you live in a world in which you experience misery more often than joy, adaptation is very beneficial. It may be the only thing that gives you the strength and courage to get through the day. But if you live in a world of plenty, in which sources of joy outnumber sources of misery, then adaptation defeats your attempts to enjoy your good fortune.
When people evaluate an experience, they are performin one or more of the following comparisons: Comparing the experience to what they hoped it would be. Comparing the experience to what they expected it to be. Comparing the experience to other experiences they have had in the recent past. Comparing the experience to experiences that others have had.
In the same way, getting a B+ on a difficult exam can fall to either side of the hedonic neutral point. Were you hoping for a B or were you hoping for an A? Were you expecting a B or expecting an A? Do you normally get Bs or do you normally get As? And what grades did your classmates get?
The “hedonic treadmill” and the “satisfaction treadmill” that I discussed in the last chapter explain to a significant degree how real income can increase by a factor of two (in the U.S.) or five (in Japan) without having a measurable effect on the subjective well-being of the members of society. As long as expectations keep pace with realizations, people may live better, but they won’t feel better about how they live. [A great book about happiness: Happiness Hypothesis by Jonathan Haidt]
It is called prospect theory, and it was developed by Daniel Kahneman and Amos Tversky. What the theory claims is that evaluations are relative to a baseline. A given experience will feel positive if it’s an improvement on what came before and negative if it’s worse than what came before. To understand how we will judge an experience, it is necessary first to find out where we set our hedonic zero point.
In Chapter 3, I emphasized how language can affect the framing of an experience and thus, the setting of the zero point. A sign at a gas station that says “Discount for Paying Cash” sets the zero point at the credit card price. A sign that says “Surcharge for Using Credit” sets the zero point at the cash price.
But the language of description is not the only factor that affects the setting of the zero point. Expectations do as well. “How good did I expect this meal (exam grade, wine, vacation, job, romantic relationship) to be?” people ask themselves. Then they ask themselves, “How good was it?” If the experience was as good as expected, people may be satisfied, but they won’t be ecstatic. Real hedonic charge comes when an experience exceeds expectations. And hedonic distress comes when experience fails to live up to expectations. Past experience also affects the setting of the zero point, which is, in part, what adaptation is about. “Was it as good as last time?” we ask. If so, we may again be satisfied, but we will not be enthused.
Falling back is the American nightmare. So if your perch is high, you have much further to fall than if your perch is low. Fear of falling is the curse of high expectations. [I cannot agree. Completely possible to have high expectations without fear of failing. But, such expectations are non-monetary. In monetary there is great fear of failure. Has to do with the fact that so little things are in our control - see books on Stoic philosophy, especially A Guide to the Good Life by William E. Irwine.]
The blessing of modest expectations is that they leave room for many experiences to be a pleasant surprise, a hedonic plus. The challenge is to find a way to keep expectations modest, even as actual experiences keep getting better.
One way of achieving this goal is by keeping wonderful experiences rare. No matter what you can afford, save great wine for special occasions.
What’s the point of great meals, great wines, and great blouses if they don’t make you feel great?
Of all the sources we rely on when we evaluate experiences, perhaps nothing is more important than comparisons to other people. Our answer to the “How am I doing?” question depends on our own past experiences, aspirations, and expectations, but the question is virtually never asked or answered in a social vacuum. “How am I doing?” almost always carries “compared to others” in parentheses.
People can compare themselves with others who have done better (upward social comparison) or worse (downward social comparison). Usually, downward social comparisons nudge people up the hedonic thermometer, and upward social comparisons nudge them down.
At times, people engaging in social comparison respond positively to upward comparisons and negatively to downward comparisons. Learning that others are worse off can lead you to consider that you yourself can become worse off. When you compare yourself with others who are worse off, you may take pleasure in your superiority, but you may also experience guilt, embarrassment, the need to cope with other people’s envy or resentment, and the fear that their fate could happen to you. And when you compare yourself with others who are better off, you may feel envy or resentment, but you may also be motivated or inspired.
If you live in a social world, as we all do, you are always being hit with information about how others are doing.
People are driven to social comparison largely because they care about status, and status, of course, has social comparison built into it. Part of the satisfaction from achievements and possessions comes from the awareness that not everyone can match them. As others start to catch up, the desires of those who are ahead in the “race” escalate so that they can maintain their privileged position.
So instead of comparing ourselves to everyone, we try to mark off the world in such a way that in our pond, in comparison with our reference group, we are successful. Better to be the third-highest-paid lawyer in a small firm and make $120,000 a year than to be in the middle of the pack in a large firm and make $150,000. The way to be happy—the way to succeed in the quest for status—is to find the right pond and stay in it.
A person living in a blue-collar urban neighborhood forty years ago might have been content with his lower-middle-class-income because that brought him a life comparable to what he saw around him. There would have been little to incite his status-enhancing aspirations. But not anymore. Now this person gets to see how the wealthy live countless times every day. We all seem to be swimming in one giant pond nowadays, and anyone’s life could be ours. This essentially universal and unrealistically high standard of comparison decreases the satisfaction of those of us who are in the middle or below, even as the actual circumstances of our lives improve.
But even if people could be taught to care less about status, they would still not be satisfied with what they have, because they have legitimate reasons for believing that no matter how much a person has, it may not be enough.
There are certain kinds of goods that no amount of technological development will make universally available. For example, not everyone will be able to own a secluded acre of land at the seashore. Not everyone will have the most interesting job. Not everyone can be the boss. Not everyone can go to the best college or belong to the best country club. Not everyone can be treated by the “best” doctor in the “best” hospital. Hirsch calls goods like these positional goods, because how likely anyone is to get them depends upon his position in society. No matter how many resources a person has, if everyone else has at least as much, his chances of enjoying these positional goods are slim. Sometimes these kinds of goods are positional simply because the supply can’t be increased. Not everyone can have a van Gogh hanging in his living room. At other times, the problem is that as more consumers gain access to these goods, their value decreases due to overcrowding.
We might all agree that everyone would be better off if there were less positional competition. It’s stressful, it’s wasteful, and it distorts people’s lives. Parents wanting only the best for their child encourage her to study hard so she can get into a good college. But everyone is doing that. So the parents push harder. But so does everybody else. So they send their child to after-school enrichment programs and educational summer camps. And so does everyone else. So now they borrow money to switch to private school. Again, others follow. So they nag at their youngster to become a great musician or athlete or something that will make her distinctive. They hire tutors and trainers. But, of course, so does everyone else, or at least everyone who has not gone broke trying to keep up. The poor child, meanwhile, has been so tortured by parental aspirations for her that she loses interest in all the things they have forced her to do for the sake of her future. [See the movie American Psycho; everybody wants to be different in the same way; not too much.]
It’s like being in a crowded football stadium, watching the crucial play. A spectator several rows in front stands up to get a better view, and a chain reaction follows. Soon everyone is standing, just to be able to see as well as before. Everyone is on their feet rather than sitting, but no one’s position has improved. And if someone, unilaterally and resolutely, refuses to stand, he might just as well not be at the game at all. When people pursue goods that are positional, they can’t help being in the rat race. To choose not to run is to lose.
Happy people were only minimally affected by whether the person working next to them was better or worse at the anagram task than they were.
Happy people have the ability to distract themselves and move on, whereas unhappy people get stuck ruminating and make themselves more and more miserable.
We found that maximizers were much more affected by the presence of another person than satisficers were. Solving anagrams alongside someone who seemed to be doing it better produced in maximizers both a deterioration of mood and a lowered assessment of their anagram-solving ability. The social comparison information had no such effect on satisficers.
If you think about what maximizing requires of people, this result is not surprising. Maximizers want the best, but how do you know that you have the best, except by comparison? And to the extent that we have more options, determining the “best” can become overwhelmingly difficult. The maximizer becomes a slave in her judgments to the experiences of other people.
Satisficers don’t have this problem. Satisficers who are looking for results that are good enough can use the experiences of others to help them determine exactly what “good enough” is, but they don’t have to. They can rely on their own internal assessments to develop those standards. A “good enough” salary is one that enables them to afford a decent place to live, some nice clothes, an occasional night out, and so on. It doesn’t matter that others may earn more. A good enough stereo is one that satisfies their own concerns about sound fidelity, convenience, appearance, and reliability.
The more difficult information gathering is, the more likely it is that you will rely on the decisions of others. Even if you are not after the best wallpaper for your kitchen, when faced with a choice among hundreds or thousands of possibilities, the search for something good enough can be enormously simplified by knowing what others have chosen. So overwhelming choice is going to push you in the direction of looking over your shoulder at what others are doing. But the more social comparison you do, the more likely you are to be affected by it, and the direction of such effects tends to be negative. So by forcing us to look around at what others are doing before we make decisions, the world of bountiful options is encouraging a process that will often, if not always, leave us feeling worse about our decisions than we would if we hadn’t engaged in the process to begin with.
With limitless choice we produce better results with our decisions than we would in a more limited world, but we feel worse about them.
According to Seligman’s hypothesis, therefore, having control is of crucial importance to psychological well-being.
Not everyone who experiences a significant lack of control becomes depressed. So the theory was modified by Seligman and coworkers in 1978. The revised theory of helplessness and depression suggested that important psychological steps intervene between the experience of helplessness and depression. According to the new theory, when people experience a failure, a lack of control, they ask themselves why. “Why did my partner end the relationship?” “Why didn’t I get the job?” “Why did I fail to close the deal?” “Why did I blow the exam?” In other words, people seek to understand the causes of their failures.
The revised theory of helplessness and depression argued that helplessness induced by failure or lack of control leads to depression if a person’s causal explanations for that failure are global, chronic, and personal. It is only then, after all, that people will have good reason to expect one failure to be followed by another, and another, and another. What’s the point of getting out of bed, getting dressed, and trying again if the results are foreordained.
“Optimists” explain successes with chronic, global, and personal causes and failures with transient, specific, and universal ones. “Pessimists” do the reverse. Optimists say things like “I got an A” and “She gave me a C.” Pessimists say things like “I got a C” and “He gave me an A.” And it is the pessimists who are candidates for depression.
People who find chronic causes for failure expect failures to persist; those who find transient causes don’t. People who find global causes for failure expect failure to follow them into every area of life; those who find specific causes don’t. And people who find personal causes for failure suffer large losses in self-esteem; those who find universal causes don’t.
I’m not suggesting that taking credit for every success and blaming the world for every failure is the recipe for a successful and happy life. Nonetheless, I think it is fair to say that for most people, most of the time, excessive self-blame has bad psychological consequences. And as we’ll see, it is much easier to blame yourself for disappointing results in a world that provides unlimited choice than in a world in which options are limited.
Increases in experienced control have been accompanied, stride for stride, by increases in expectations about control. The more we are allowed to be the masters of our fates, the more we expect ourselves to be. We should be able to find education that is stimulating and useful, work that is exciting, socially valuable, and remunerative, spouses who are sexually, emotionally, and intellectually stimulating and also loyal and comforting. Our children are supposed to be beautiful, smart, affectionate, obedient, and independent. And everything we buy is supposed to be the best of its kind. With all the choice available, we should never have to settle for things that are just “good enough.” Emphasis on freedom of choice, together with the proliferation of possibilities that modern life affords, has, I believe, contributed to these unrealistic expectations.
The key fact about psychological life in societies in which you have little control over these aspects of life is that you also have little expectation of control. And because of this, I think, lack of control does not lead to feelings of helplessness and depression.
American culture has also become more individualistic than it was, perhaps as a by-product of the desire to have control over every aspect of life. To be less individualistic—to tie oneself tightly into networks of family, friends, and community—is to be bound, to some degree, by the needs of family, friends, and community. If our attachments to others are serious, we can’t just do whatever we want. I think the single most difficult negotiation that faces young people who marry in today’s America is the one in which the partners decide where their individual autonomy ends and marital obligation and responsibility take over.
Our heightened individualism means that, not only do we expect perfection in all things, but we expect to produce this perfection ourselves. When we (inevitably) fail, the culture of individualism biases us toward causal explanations that focus on personal rather than universal factors. That is, the culture has established a kind of officially acceptable style of causal explanation, and it is one that encourages the individual to blame himself for failure. And this is just the kind of causal explanation that promotes depression when we are faced with failure.
As a corollary, the modern emphasis on individual autonomy and control may be neutralizing a crucial vaccine against depression: deep commitment and belonging to social groups and institutions—families, civic associations, faith communities, and the like. There is an inherent tension between being your own person, or determining your own “self,” and meaningful involvement in social groups. Significant social involvement requires subordinating the self. So the more we focus on ourselves, the more our connections to others weakens.
Among people who score highest on our Maximization Scale, scores on the standard measure of depression are in the borderline clinical depression range. We find the same relation between maximizing and depression among young adolescents. High expectations and taking personal responsibility for failing to meet them can apply to educational decisions, career decisions, and marital decisions, just as they apply to decisions about where to eat.
Those nations whose citizens value personal freedom and control the most tend to have the highest suicide rates. Eckersley is quick to point out that these same values allow certain individuals within these cultures to thrive and prosper to an extraordinary degree. The problem is that on the national or “ecological” level, these same values have a pervasive, toxic effect.
We are free to be the authors of our own lives, but we don’t know exactly what kind of lives we want to “write.”
1. Choose When to Choose
For example, you could make it a rule to visit no more than two stores when shopping for clothing or to consider no more than two locations when planning a vacation.
2. Be a Chooser, Not a Picker
Shorten or eliminate deliberations about decisions that are unimportant to you; Use some of the time you’ve freed up to ask yourself what you really want in the areas of your life where decisions matter; And if you discover that none of the options the world presents in those areas meet your needs, start thinking about creating better options that do.
3. Satisfice More and Maximize Less
Knowing what’s good enough requires knowing yourself and what you care about. So: Think about occasions in life when you settle, comfortably, for “good enough”; Scrutinize how you choose in those areas; Then apply that strategy more broadly.
4. Think About the Opportunity Costs of Opportunity Costs
A “good investment” for a satisficer may be one that returns more than inflation. Period. No need to worry about opportunity costs. No need to experience the diminution of satisfaction that comes from contemplating all the other things you might have done with the money. Will the satisficer earn less from investments than the maximizer? Perhaps. Will she be less satisfied with the results? Probably not. Will she have more time available to devote to other decisions that matter to her? Absolutely.
There are some strategies you can use to help you avoid the disappointment that comes from thinking about opportunity costs: Unless you’re truly dissatisfied, stick with what you always buy. Don’t be tempted by “new and improved.” Don’t “scratch” unless there’s an “itch.” And don’t worry that if you do this, you’ll miss out on all the new things the world has to offer.
5. Make Your Decisions Nonreversible
What we don’t realize is that the very option of being allowed to change our minds seems to increase the chances that we will change our minds. When we can change our minds about decisions, we are less satisfied with them. When a decision is final, we engage in a variety of psychological processes that enhance our feelings about the choice we made relative to the alternatives. If a decision is reversible, we don’t engage these processes to the same degree.
6. Practice an “Attitude of Gratitude”
We can vastly improve our subjective experience by consciously striving to be grateful more often for what is good about a choice or an experience, and to be disappointed less by what is bad about it.
7. Regret Less
Remember just how complex life is and realize how rare it is that any single decision, in and of itself, has the life-transforming power we sometimes think.
8. Anticipate Adaptation
Not only do we adapt to a given experience so that it feels less good over time, but we can also adapt to a given level of feeling good so that it stops feeling good enough. Imagining all the ways in which we could be feeling worse might prevent us from taking for granted (adapting to) how good we actually feel.
9. Control Expectations
Remove excessively high expectations. This is easier said than done, especially in a world that encourages high expectations and offers so many choices that it seems only reasonable to believe that some option out there will be perfect. The thrill of unexpected pleasure stumbled upon by accident often can make the perfect little diner or country inn far more enjoyable than a fancy French restaurant or four-star hotel.
10. Curtail Social Comparison
Though social comparison can provide useful information, it often reduces our satisfaction. So by comparing ourselves to others less, we will be satisfied more. Remember that “He who dies with the most toys wins” is a bumper sticker, not wisdom. Focus on what makes you happy, and what gives meaning to your life.
11. Learn to Love Constraints
It might make sense, given that one can’t maximize all the time, that one would elect to be a maximizer about the important things (job, spouse, children, retirement investments, etc.) and be a satisficer when it comes to everything else.
It’s good news, by the way, that even the most extreme maximizers satisfice about many things. This means that if you want to satisfice more and maximize less, you already know how to do so. You simply need to take decision-making strategies that you already use effectively in some areas of your life and apply them to others.
The real challenge in life is doing the right thing in social interactions. It is knowing how to balance honesty with kindness, courage with caution, encouragement with criticism, empathy with detachment, paternalism with respect for autonomy. We have to figure this balance out case by case, person by person. And the only way to do so is by getting to know the other people you are most closely linked to—by taking the time to listen to them, to imagine life through their eyes, and to allow yourself to be changed—even transformed—by them. In a hurried world that forces you to make decision after decision, each involving almost unlimited options, it’s hard to find the time. You may not always be conscious of this, but your effort to get the best car will interfere with your desire to be a good friend. Your effort to get the best job will intrude on your duty to be the best parent. And so, if the time you save by following some of my suggestions is redirected to the improvement of your relationships with other people in your life, you will not only make your life happier, you will improve theirs.
