Dan Ariely Quotes

Big Data is like teenage sex: everyone talks about it, nobody really knows how to do it, everyone thinks everyone else is doing it, so everyone claims they are doing it.

One of the big lessons from behavioral economics is that we make decisions as a function of the environment that we're in.

Even the most analytical thinkers are predictably irrational; the really smart ones acknowledge and address their irrationalities.

One percent of people will always be honest and never steal," the locksmith said. "Another one percent will always be dishonest and always try to pick your lock and steal your television. And the rest will be honest as long as the conditions are right - but if they are tempted enough, they'll be dishonest too. Locks won't protect you from the thieves, who can get in your house if they really want to. They will only protect you from the mostly honest people who might be tempted to try your door if it had no lock".

We are all far less rational in our decision-making than standard economic theory assumes. Our irrational behaviors are neither random nor senseless: they are systematic and predictable. We all make the same types of mistakes over and over, because of the basic wiring of our brains.

We all want explanations for why we behave as we do and for the ways the world around us functions. Even when our feeble explanations have little to do with reality. We’re storytelling creatures by nature, and we tell ourselves story after story until we come up with an explanation that we like and that sounds reasonable enough to believe. And when the story portrays us in a more glowing and positive light, so much the better.

The idea that you will make the right decision every time is very unlikely.

Giving up on our long-term goals for immediate gratification, my friends, is procrastination.

Your immediate environment is comprised of coffee shops, supermarkets, websites, apps and all kinds of things - none of which have an interest in your long-term or short-term financial well-being.

Companies, however unintentionally, choke the motivation out of their employees.

Honesty is a complex and tricky thing, and we don't want to be honest all the time.

The most difficult thing is to recognize that sometimes we too are blinded by our own incentives. Because we don’t see how our conflicts of interest work on us.

When we think about labor, we usually think about motivation and payment as the same thing, but the reality is that we should probably add all kinds of things to it - meaning, creation, challenges, ownership, identity, pride, etc.

The bad news is that ignoring the performance of people is almost as bad as shredding their effort in front of their eyes. Ignoring gets you a whole way out there. The good news is that by simply looking at something that somebody has done, scanning it and saying "Uh huh," that seems to be quite sufficient to dramatically improve people's motivations.

Thinking is difficult and sometimes unpleasant.

Brands communicate in two directions: they help us tell other people something about ourselves, but they also help us form ideas about who we are.

There's something about [cyclically] doing something over and over and over that seems to be particularly demotivating.

If I gave you now, $10 as a gift, how happy would you be? Would you be happy, is the marginal $10, the best use of $10 you can use? Of course not. If I have you a CD, you know exactly what you are getting and you will have a value for it. So, money has lots of problems with it.

We're actually trying to develop an iPhone app, now that the Droid is out, we'll do it for that as well, if we ever learn how to program on this thing. But the idea is that to make money concrete. So, you can do this app, and it's not out there, but you can do the app. And you say, "I like vacation in the Bahamas, shoes, lattes, and books." And now, when you are tempted to buy something, that thing translates in terms of the things you are interested in.

To summarize, using money to motivate people can be a double-edged sword. For tasks that require cognitive ability, low to moderate performance-based incentives can help. But when the incentive level is very high, it can command too much attention and thereby distract the person’s mind with thoughts about the reward. This can create stress and ultimately reduce the level of performance.

The things that motivate us are to help other people, to feel that we're useful, to feel that we're getting better, to feel that we are kind of living to our potential, to get a sense of meaning. All of those things are positive.

The major thing that holds you back when you're trying to change a bad habit like eating, smoking, or drinking too much is your belief you are out of control.

The experiments show quite clearly that, as you resist more and more temptation, you're actually more and more likely to fail.

Money is very difficult to think about. So, we think about money as the opportunity cost of money. So, we at some point went to a Toyota dealership and we asked people, what will you not be able to do in the future if you bought this Toyota? Now, you would expect people to have an answer. But people were kind of shocked by the question. They never thought about it before. So, the most we got was people said, "Well, if I can't buy this Toyota, if I buy this Toyota, I can't buy a Honda." What is this thing? What is this value of price? Very hard to think about it.

We need to believe that we're good people, and we'll do just about anything to maintain that perception.

Money is a great way to get happiness. Right? Lots of wonderful things you can do with money. The question is, are we really optimizing on that? So, if you think about getting lattes and getting cable. Which one of those is actually giving you a greater happiness, and if you have to cut on one of those, which one would you cut? So, I think thinking in terms of concrete terms would help us a great deal.

A very simple bad decision is to get into debt. And that is very expensive.

People are willing to work free, and they are willing to work for a reasonable wage; but offer them just a small payment and they will walk away.

If we all make systematic mistakes in our decisions, then why not develop new strategies, tools, and methods to help us make better decisions and improve our overall well-being? That's exactly the meaning of free lunches- the idea that there are tools, methods, and policies that can help all of us make better decisions and as a consequence achieve what we desire-pg. 241

People are irrational - and predictably so.

We should teach the students, as well as executives, how to conduct experiments, how to examine data, and how to use these tools to make better decisions.

But because human being tend to focus on short-term benefits and our own immediate needs, such tragedies of the commons occur frequently .

Interesting thing that is happening in American society is that people are starting to talk about money. I don't know how you feel about this, but for a long time, nobody was talking about money. It was a secret. And it's kind of very interesting because we do lots of stuff to portray to people about how much money we have, the clothes we wear and the cars we have and the house - they all kind of depict to other people, signal how much money we make, but we don't talk about it specifically.

We usually think of ourselves as sitting the driver's seat, with ultimate control over the decisions we made and the direction our life takes; but, alas, this perception has more to do with our desires-with how we want to view ourselves, than with reality.

...[D]ivision of labor, in my mind, is one of the dangers of work-based technology. Modern IT infrastructure allows us to break projects into very small, discrete parts and assign each person to do only one of the many parts. In so doing, companies run the risk of taking away employees' sense of the big picture, purpose, and sense of completion.

With everything you do, in fact, you should train yourself to question your repeated behaviors.

If you get people to feel that they are putting something, that they are creating it and so on, their love for the project would increase. The more something is yours, the more you're willing to invest in it.

You can think about life as a battle between you and a doughnut shop. The doughnut shop wants you to eat another doughnut and pay the money, and you want to do it in the short term, but in the long term it's not good for you either financially or from a health perspective.

We have very strong intuitions about all kinds of things — our own ability, how the economy works, how we should pay school teachers. But unless we start testing those intuitions, we’re not going to do better.

Disasters are usually a good time to re-examine what we've done so far, what mistakes we've made, and what improvements should come next.

For all of us, it's very hard to think about money, and because of that, we need help. In the same way that for all of us, it is hard to eat well, and we need some help. The poor have a particular challenge, which is that their life is actually much more complex - and they're much more complex cognitively.

We can think about how we reduce the pain in paying. So, for example, credit cards are wonderful mechanisms to reduce the pain of paying. If you go to a restaurant and you are paying cash, you would feel much worse than if you were paying with credit card. Why? You know the price, there's no surprise, but if you're paying cash, you feel a bit more guilt.

Take a brilliant, creative social scientist, without any respect for conventional wisdom and you get Ellen Langer. She is a fantastic storyteller, and Counterclockwise is a fascinating story about the unexpected ways in which our minds and bodies are connected.

When you're in pain, tomorrow doesn't exist - just the pain - and the only thing that you want in the world is for it to go away.

The retail industry has its own headache: it loses $16 billion a year to customers who buy clothes, wear them with the tags tucked in, and return these secondhand clothes for a full refund.

The problem with opportunity cost is that opportunity cost is divided among many, many things.

Scaling down individually is very hard. Imagine that if you go to a place where everybody is dressed nicely, and you are the only one who doesn't dress nicely. Everybody goes on vacations to a great place and you go to the Jersey shore. It's very hard to do these things without an organized mechanism, but it looks to me like there might be some organized mechanisms.

The companies that provide debt, what do you think their goal is? Is their goal for you to fully understand the cost of your debt? No. So they're basically creating these approaches to make you feel like it is incredibly cheap or just to think about the cost per day rather the cost per year or cost for a lifetime. So debt is very simple mistake.

I don't know what exactly the translation is but when we do consume something now, something else has to give at some point.

In life we encounter many people who, in some way or another, try to tattoo our faces.