Are People Inherently Irrational?

During my recent vacation, I read an interesting book entitled, “Predictably Irrational”. Since the various stories were engaging and the book was only 250 double spaced pages, it was an easy read over a few days.

There are already many reviews of the book, including those that debate the author’s bold conclusions from simple experiments (e.g., “the price of everything is up in the air”), thus I don’t intend to duplicate those comments. Instead, I will tell you that a very useful feature of the book is it provides experimental observations about human behavior in an easy-to-digest manner (I’m not one that really enjoys reading about t-tests and statistical significance anyways). For me, Predictably Irrational provided quantitative insights to support some of my assumptions about people. I few of my takeaways from the author’s experiments and conclusions:

1) The notion of “Free” is extremely enticing to consumers
2) Arousal of the senses (sexual or otherwise) can cause people to do crazy things
3) Expectations can greatly influence your perceptions about many experiences
4) “Prestige pricing” has a very real impact on people’s expectations for a product
5) Given the opportunity, most people will push the fringes of ethics and honesty
6) Keeping “all of your options open” can often lead to sub-optimal results

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