Alchemy

🚀 The Book in 3 Sentences

This book is about the lack of knowledge and the dangers of trying to be "too" scientific. It goes into the different aspects of human nature that is difficult to explain.

🎨 Impressions

Very very good book. It is a statement against the logical man and the economic man that is basically a stupid brain exercise. It is a good deep dive into human nature and sets good examples as to why human nature and nature, in general, are more complicated and sometimes do not make sense.

☘️ How the Book Changed Me

It was almost an eye-opener for me, where so many things started to make sense because they did not make sense. So many interesting tidbits that are so thought-provoking. Highly recommend the book.

✍️ My Top Quotes

• The opposite of a good idea can also be a good idea. Don’t design for average. It doesn’t pay to be logical if everyone else is being logical. The nature of our attention affects the nature of our experience. A flower is simply a weed with an advertising budget. The problem with logic is that it kills off magic. A good guess which stands up to observation is still science. So is a lucky accident. Test counterintuitive things only because no one else will.

• Solving problems using rationality is like playing golf with only one club. Dare to be trivial. If there were a logical answer, we would have found

• To avoid stupid mistakes, learn to be slightly silly.

• Here’s a simple (if expensive) lifestyle hack. If you would like everything in your kitchen to be dishwasher-proof, simply treat everything in your kitchen as though it was; after a year or so, anything that isn’t dishwasher-proof will have been either destroyed or rendered unusable. Bingo – everything you have left will now be dishwasher-proof!

• The Nobel Prize-winning behavioural scientist Richard Thaler said, ‘As a general rule the US Government is run by lawyers who occasionally take advice from economists. Others interested in helping the lawyers out need not apply.’

• Irrational people are much more powerful than rational people, because their threats are so much more convincing.

• My problem with Marxism is that it makes too much sense.

• Imagine that you get into financial trouble and ask a rich friend for a loan of £5,000, who patiently explains that you are a much less needy and deserving case for support than a village in Africa to which he plans to donate the same amount. Your friend is behaving perfectly rationally. Unfortunately he is no longer your friend.

• No coincidence that Jeremy Bentham, the father of utilitarianism, was one of the strangest and most anti-social people who ever lived.

• I had always innocently assumed that after Edward Jenner discovered a vaccination against smallpox he would have presented his findings before sitting back to enjoy the acclaim. The truth was nothing of the kind; he spent the rest of his life defending his idea against a large number of people who had profited from an earlier practice called variolation, and were reluctant to admit that anything else was better.

• As the psychologist Jonathan Haidt has shown, most moralising works in this way. We react instinctively, before hastily casting about for rationalisations

• Perhaps advertising agencies are largely valuable simply because they create a culture in which it is acceptable to ask daft questions and make foolish suggestions.

• Believe it or not, the phrase ‘Often a bridesmaid, never a bride’ has its origins in an advert for Listerine – here was a hygiene product being sold not on medical benefits but on the fear of social and sexual rejection.

• ‘When I ask an economist, the answer always boils down to just bribing people.’

• However, the problem will never go away, because the number of people who think they understand statistics dangerously dwarfs those who actually do, and maths can cause fundamental problems when badly used.

• Put in mathematical language, an ensemble perspective is not the same as a time-series perspective

• Talking to Ole Peters, I realised that the problem went wider than that – nearly all pricing models assume that ten people paying for something once is the same as one person paying for something ten times, but this is obviously not the case.

• It’s true that ‘what gets measured gets managed’, but the concomitant truth is ‘what gets mismeasured gets mismanaged’.

• The more data you have, the easier it is to find support for some spurious, self-serving narrative. The profusion of data in future will not settle arguments: it will make them worse.

• Wine tastes better when poured from a heavier bottle. Painkillers are more effective when people believe they are expensive.

• The request for the Walkman had initially come from the 70-year-old Ibuka, who wanted a small device to allow him to listen to full-length operas on flights between Tokyo and the US.

• ‘The term affordance refers to the perceived and actual properties of the thing, primarily those fundamental properties that determine just how the thing could possibly be used. Affordances provide strong clues to the operations of things.

• ‘No one ever got fired for buying IBM’ was never the company’s official slogan – but when it gained currency among corporate buyers of IT systems, it became what several commentators have called ‘the most valuable marketing mantra in existence’.

• In game theory, this prospect of repetition is known as ‘continuation probability’, and the American political scientist Robert Axelrod has poetically referred to it as ‘The Shadow of the Future’.

• ‘Credo quia absurdum est’, said Saint Augustine, supposedly – ‘I believe it because it is ridiculous.’ He was talking about Christianity, but it is equally true of many other facets of life: we attach meaning to things precisely because they deviate from what seems sensible.

• The psychophysicist Mark Changizi has a simple evolutionary explanation for why water ‘doesn’t taste of anything’: he thinks that the human taste mechanism has been calibrated not to notice the taste of water, so it is optimally attuned to the taste of anything that might be polluting it.

• Water ‘tastes of nothing’, so we notice the smallest thing which deviates from this. You can try a similar experiment with young children. Feed them their favourite food, but add a subtle herb or spice. They will find it revolting, because the slight deviation from what they expect alarms them into believing it is somehow unsafe.

• Well, sometimes they do – false advertising is common in orchids, which often seem to be the scam artists of the plant kingdom.

• In advertising, a large budget does not prove a product is good, but it does establish that the advertiser is confident enough in the future popularity of the product to spend some of his resources promoting it.

• There is a problem, however: what starts off as a reliable indicator of fitness can turn into an arms race. If you are a fit bullfrog, how long should you keep up your mating call? The only safe answer to this question is ‘for a bit longer than any other bullfrog nearby’. As a result, a quality that starts off being prized as a useful proxy for fitness becomes exaggerated to an absurd degree, a process sometimes known as Fisherian runaway selection.

• For decades, the most sympathetic ear I had at The Economist in London was not their marketing correspondent (who seemed to genuinely hate marketing) but their science correspondent, whose background was as an evolutionary biologist.

• The main value of a dishwasher, I would argue, is not that it washes dirty dishes, but that it provides you with an out-of-sight place to put them.

• The intriguing thing about Uber as an innovation was that no one really asked for it before it existed. Its success lay in a couple of astute psychological hacks: the fact that no money changes hands during a trip is one of the most powerful – it makes using it feel like a service rather than a transaction.

• The Netflix documentary Sour Grapes is a fascinating insight into this world. A crooked, though brilliant, Indonesian wine connoisseur called Rudy Kurniawan was able to replicate great burgundies by mixing cheaper wines together, before faking the corks and the labels. He was rumbled only when he attempted to fake wines from vintages that did not exist. I am told that it is possible to detect a forged Kurniawan wine by analysing the labels, but not by tasting the wine.

• People didn’t want low prices – they wanted concrete savings.

• The Polish-American academic Alfred Korzybski (1879–1950) is perhaps most famous for his dictum that ‘The map is not the territory.’

• ‘If the wind rustles the grass and you misinterpret it as a lion, no harm done. But if you fail to detect an actual lion, you’re taken out of the gene pool.’

• Deploy the ‘Goldilocks effect’ – the natural human bias that means that, when presented with three options, we are most likely to choose the one in the middle.

• Add intricacy: simply adding coloured flecks to a plain white powder will make people believe it is more effective, even if they do not know what role these flecks perform.

• People seem to like choice for its own sake.

• However, he was hopeful that people, even if they couldn’t see the biases in themselves, might use behavioural science to better understand the behaviour of others.

• If we could resist the urge to be logical just some of the time, and devote that time instead to the pursuit of alchemy, what might we discover?