How to interact with potentially hostile journalists

One of the things I have started to suspect recently is that most people’s estimations of a journalist’s personal trustworthiness seem to suffer a kind of reverse Gel-Mann amnesia effect. The phenomenon was wonderfully described by Michael Crichton: 

“Briefly stated, the Gell-Mann Amnesia effect is as follows. You open the newspaper to an article on some subject you know well. In Murray’s case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward—reversing cause and effect. I call these the “wet streets cause rain” stories. Paper’s full of them.

In any case, you read with exasperation or amusement the multiple errors in a story, and then turn the page to national or international affairs, and read as if the rest of the newspaper was somehow more accurate about Palestine than the baloney you just read. You turn the page, and forget what you know.”

In other words, there is a systematic gap between estimates of the journalist’s bare competence in things you know well, and things of which you’re ignorant. In general journalists get the benefit of the doubt, except where your personal knowledge comes in.

However, consider the perspective of the political right on the question of a journalist’s trustworthiness, rather than their competence. Here the effect is reversed.

In general, most people with any sense tend to believe that journalists are mendacious, dishonest scum, who will say almost anything to get you to talk, and then regardless of past assurances, will distort your quotes to paint you in the worst possible light. Your best strategy is to ignore them. This applies orders of magnitude more if you hold any vaguely right wing opinions, and the media wants to talk to you about them out of the blue.

But for some reason, when a particular journalist comes to talk to you, wanting to let you tell your side of the story on an article they’re planning on writing about you, people forget this. Rather, they suddenly assume that it’s somehow a good idea to talk to the person, because this specific journalist actually seems pretty reasonable, so what’s the worst that can happen? Like Crichton observed, they forget what they know. And like night follows day, the journalist was lying, and they smear you and stitch you up, and somehow the result comes as a surprise.

It’s one thing for the average normie who believes that the press is honest to get suckered like this. But this happens over and over again to people who not only ought to know better, but actually do know better.

Here’s what happened to Nick Fuentes, of “America First” fame:

“In February 2018, a production company called “Karga7” reached out and said they were interested in filming an episode of MTV True Life about me and my show. They spent a full week filming at my house but never released any of the footage until tonight, almost two years later.

Pete and a team from Karga7 came to my house and filmed for a week, doing hours of interviews, B-Roll, they filmed me doing my show and they covered my periscope of an anti-gun rally in Chicago. This is what my mother texted to Pete Ritchie at the end of the shoot:‘Same Pete, you seem like a genuine person. We are relieved. See you then! Promise Al will be in boarding school.’ “

Psych, there was no episode of MTV True Life. Instead, all the footage ended up in a documentary titled “White Supremacy Destroyed My Life”. No kidding! You don’t need to watch it to know how that turned out for Fuentes and his family.

Okay, you might say, maybe Nick Fuentes is just a naïve fool. But this happened to Curtis Yarvin! That’s right, Mencius Moldbug, the man who taught me more than anyone else about how the media operates, and its role in the power structure of the modern west. He used to have a medium post about the experience, but it seems to be gone now, so I’m paraphrasing the story from memory. It turns out that nearly all of Yarvin’s enemies are too stupid or lazy to actually read through his voluminous and meandering writings (which, to be fair, is a very polarizing writing style – I love it, but others I know and respect find it offputting). So instead, everyone relies on one leftist guy who bothered to read things and happened to find a single infelicitously-phrased remark relating to how the early Spanish in the Americas tended to prefer imported African populations as slaves, rather than the indigenous population. Anyway, one day Yarvin gets a bunch of ridiculous and obviously muck-raking questions from a journalist asking if he supports slavery (something nobody who has read his actual writings could conceivably believe). He writes back a fascinating a thoughtful paragraph exploring the concept through the lens of Robert Nozick’s disturbing and compelling “Tale of a Slave” (read that if you haven’t already, it’s very short and extremely good). The journalist ignores the whole thing, repeats the question again if he supports slavery and insists on only a yes or no response. Yarvin answers “No”. Journalist, predictably, writes article anyway accusing him of supporting slavery.

At this point, dear reader, I think we ought to take seriously the possibility that something strange is at play here, something which we don’t fully understand. How does Curtis Yarvin, of all people, end up getting stitched up by some idiot journalist?

I think the starting point of understanding is that this actually is very similar to what happens with the other major group whose profession it is to get people to talk, when it’s very much in their interests to shut up. I’m referring, of course, to the police. Your mental model of journalists ought to be able to incorporate why people regularly confess to the police, often without realizing that that’s what they’re doing.

If you haven’t already, watch all 46 minutes of James Duane’s presentation on the subject. For the general subject of why you shouldn’t talk to the police, watch the first half, with James Duane, the law professor. But to understand why people talk to the police anyway, watch the second half, which is from a police offer. It’s eye-opening stuff.

 Hardened criminals have no problem talking to the police. People like to tell their story. And they’ll sit in that room and think about it. There’s one chair here, there’s a desk, there’s another chair. What’s the one thing you want the most, right at that point? To get out of that room. To be out of that room. The police officer’s shift is ending in fifteen minutes. Does the police officer want to get out of that room? My overtime rate is $58 an hour, do I want to get out of that room? I have no problem, I’ll stay there for ten hours. I’ll take that six hundred dollars. So I have no motivation to want to leave, and you do, and that’s how we get you to try to talk. …

[S]ay you wanted to go into a boxing match. A hundred dollars if you win. You’ve never boxed before. You have to face somebody who’s an Olympic boxer. You’re going to lose. You’re going to face somebody who’s been interviewing people for, in my case, 28 years. You’re going to lose. Unless you’re purely innocent. Now, on the other side of it, I don’t want to put anyone who’s innocent in jail. But I try not to bring anyone into the interview room who’s innocent.…

And then I have to determine what kind of person I have. And there’s two types. There’s the one like I mentioned earlier, where I have to talk to them, talk to them about different things, get into their own skin, as it were, and try to get them to talk to me and discuss things. I had a sexual assault case. I had to talk to the guy about how hot the woman was, and I understood where he was coming from. And when I said that, we were buds, and he started talking to me. He’s still sitting in prison. …

The other type of person is the one that likes to tell a story. … I said, tell me what happened. And he told me this beautiful story about what happened. … And I didn’t even question about it, after he finished his whole story, very implausible but very beautiful story, I sat there and listened to it for fifteen minutes, and I looked at him and I said “You stole the stuff from your boss, didn’t you?”. “Yes sir, I did.” I had nothing, I really had nothing except the fact that he’d sold it. …

Just sit there, and wait for them to start talking, and they will. People want to communicate, they hate silence. “  

I am quite certain that a New York Times journalist interviewing right wring people for a story views their job in a very similar fashion. If they’re calling you, you’re already guilty in their mind. Most people don’t know this. They think it’s all a misunderstanding. The whole point of Duane’s talk is why even the innocent should never speak to the police. If you’re guilty, you absolutely shouldn’t talk to them. From the perspective of the New York Times, I have bad news. If you’re reading this, you’re guilty. Never mind what of. They’ll come up with something, just like the police when they’re sure someone is a criminal.

I think there are several things at play here. The first of them is that one should never underestimate journalists. Like the police, they are professionals at getting people to say things against their interest. You have to assume that they will have all sorts of tricks for getting you to do this. Not only this, but you don’t know what those tricks are. You can plan in advance, but there will inevitably be aspects you still don’t foresee.

Like the police officer, part of their job is to convince you of their trustworthiness. Most people do not have much experience with professional liars. We all like to think that we’re good judges of character, but most of the sample that we deal with in our everyday life is not comprised of sociopath manipulators. Even if the person isn’t completely cold and cynical, remember, they likely view you as an enemy of society. You have to expect that they will have no compunctions about trying to delude you into thinking that they are on your side, or at least might be on your side, if you just say the right things.

People also overestimate how convincing their own arguments are. I’m convinced that I’m a good person who holds reasonable views. Surely, these people who disagree just haven’t had things explained to them properly. You know what? I’m just going to go down to the station and clear this whole thing up right now.

He’s still sitting in prison.

In the case of journalists, another classic trick they pull is to increase the time pressure. They call you on the phone, and immediately start asking questions. Do you have the wherewithal, on the spot, to not answer? How strong is your presence of mind in this situation? Or they write you an email at 3pm and tell you they have a 5pm deadline, and that they want you to comment immediately, otherwise they’ll have to print that you refused to comment.

The starting point of wisdom is this – if they call you, you’re already dead. You cannot talk them out of writing the story, any more than you can talk the police officer out of arresting you. Accept that, as a base line, you will get a bad story written about you, with the extra addendum that you refused to comment. In the distribution of things, this is a good outcome. Them distorting your words to have an even more incriminating quote is much worse.

But people love to tell their story. Give them a chance and a little prodding, and a lot of the time, they want to tell you everything. Dostoyevsky described this vividly in Crime and Punishment. Raskolnikov has an overwhelming urge to confess to the murder he committed, and keeps engaging in self-sabotaging behavior that leads him into the hands of the police officer, Porfiry. For a long time, I viewed this as being about guilt, and thus it all seemed kind of implausible. Sometimes people really do feel guilty, and I have no idea what the guilt feels like from committing a senseless murder. But I suspect that cognitive dissonance tends to resolve the dilemma mostly the other way. I killed him, so he must have deserved it, because I’m fundamentally a good person. So why the urge to confess? Well, maybe Dostoyevsky was just wrong, and the description is implausible. But maybe people also have a general desire to tell their secrets, no matter what they are. To be understood, even if the ultimate consequence is disaster. Not all people, and not at all times. But this urge is there. And the police and journalists know it. Their job depends on them knowing it, and how to manipulate this instinct in you.

Like with the police, one central problem is that only the incriminating words get shown to the jury of readers. You come up with some very clever quips, and send them off. They just chop them to pick the worst bit.

“Sorry, I don’t negotiate with terrorists.”

Mr Smith, when reached for comment, accused the New York Times of being terrorists.

Now you sound both hysterical and evasive. You said almost nothing, and it was still worse than literally nothing.

But we still haven’t cracked the underlying mystery. Don’t you think Moldbug knows all this already? Of course he does.

I would wager the following, though I’ll never be able to test it. Suppose I could go back in time five years, and speak to an earlier version of Yarvin. “Curtis”, I’d ask. “In a few years time, a journalist will contact you with obviously absurd questions about whether you support slavery. Will you give them further potentially incriminating quotes, or will you sensibly choose to stay silent?”

I suspect that the earlier versions of both Yarvin and Fuentes would have been surprised at how things turned out. They would be surprised by their own future behavior.

In other words, I think to begin to understand the puzzle, we have to recognise that we’re likely dealing with some considerable time-inconsistency. To make matters worse, in the terminology of Matthew Rabin, people are unsophisticated about their biases – they are biased, but they don’t know they are biased. So they don’t even prepare properly.

To my mind, far and away the most useful all-purpose model of time-inconsistent behavior is the hot-cold empathy gap. George Loewenstein did a lot of great work on this. The Wikipedia summary is pretty good, but as always, you’re generally better off reading the original article, which is quite accessible to a general audience.

People generally have two types of states. “Hot” states are emotionally aroused states – sexual arousal, fear, jealousy, hunger, pain, whatever. “Cold” states are the general calm, background state – a regular Tuesday morning with not much going on.

The trivial insight is that people make quite different decisions in these two types of states. Everyone knows this. The bigger insight of Loewenstein’s is the empathy gap. People in each state are predictably bad at forecasting what decisions they themselves will make in the other state, and how they will feel about the matter then. On a Tuesday morning, a high school girl doesn’t think that when she’s drunk and horny on a Saturday night, she’ll have unprotected sex with Chad from the football team. And when she’s drunk and horny on a Saturday night, she can’t think about how disastrous this choice is going to seem next Tuesday morning. In every state, our future and past selves of the opposite state are like strangers to us, and strangers whose behavior we never seem to figure out. If we had, we might have taken additional precautions, like going on the pill or carrying condoms.

I’ve written about this several times before, if you’re curious.

So how does this fit in with journalists?

I am also quite sure that if you played back the language of police interviews and the language of journalists’ interviews with people they are antagonistic towards, they would sound quite similar. The Police officer is a representative of the state, with the implicit power and backing of the state to throw you in a cell. The journalist is a representative of the cathedral, with the implicit backing of the real power centers to render you socially shunned and unemployable.

In other words, the starting point of understanding is this.

Your forecast and planning must assume that when a journalist calls you to tell you they are writing a story about your crimethink, at that point you will be incredibly scared and panicking.

The press is no joke. If they want to destroy your life, they have many avenues to do it. And despite whatever braggadocio you may have now about the lamestream media, when they come calling, your monkey brain will understand immediately what’s at stake. For millions of years, social ostracism meant death, often immediately, but in any case not long afterwards if you’re a hairless ape trying to survive on your own in the wild.

So one must immediately assume, especially if you’re never had it happen to you before, that you will be under immense pressure and stress, and will likely make bad, panicked decisions at the time. Just like the person in the police station, you want nothing more than to get out of the situation, to be told that it’s all a misunderstanding and that they’re going to call off the story. You will be like a drowning man, clawing desperately at anything that might make this happen.

In other words, you have to assume that you don’t actually know how you’ll react if the New York Times comes calling. You think you do, but you don’t. Cold State Cameron is always sure that he’ll be cool and calm under pressure. Hot State Harry usually isn’t.

And when you understand this, you realize why smart people can get themselves badly led astray, because they’re preparing for the wrong set of failure modes. The more you’re sure you understand how the media works, the more likely you’re probably overestimating how calm and collected you’ll be in the heat of the moment.

It’s like the difference between learning Tae Kwon Do and getting in your first street fight. Same problem. Things will be unexpected. And no amount of training in the dojo will replicate the gut-level panic you feel, and how that will make all your old training disappear, unless you’ve drilled and drilled. And even then, it still may not work.

We can, however, train to revert to autopilot. But it has to be the right autopilot.

What’s a bad but plausible autopilot? “If a journalist calls me, I immediately hang up.”

This would be a good plan, if you implemented it. But here’s a test. When telemarketers call you, do you immediately hang up, or do you feel some social pressure to first say that you’re not interested, or listen to their spiel, or what not? If you do, imagine this cranked up to 11. Hanging up the phone is physically easy, but psychologically sometimes hard. It’s not as hard as staring someone eye to eye in silence for five minutes in a police room. But it’s not easy when you’re panicking. You’ll want to talk your way out.

So the autopilots we train for must be those that work on a psychological basis. And what is the single, cardinal rule we’re aiming for?

Get yourself out of the situation of communicating with the journalist while in a hot state panic as soon as possible, before you make any irreversibly bad choices.

Hanging up the phone immediately is hard. So what do you say instead?

“I’m terribly sorry, but I won’t answer any questions by phone. I’ll only communicate by email. My email address is blah. (Give them time to take it down). You can email me there, and if a response is warranted, I’ll send it to you. Goodbye.”

Repeat this sentence to yourself, right now, fifty times, word for word. You must know it by heart, the same way you’re only going to have any hope of throwing an effective punch in a fight if you’ve drilled it thousands of times.

You’ve already given them something. You acknowledge they exist, and now they have an email address for you (ideally, use a throwaway one, though it’s hard to have the presence of mind to remember this). This is not ideal, but that’s not the point. The point is to delay. It now takes them some time to type up their questions. More importantly, when you get them, you’ve got time to ponder the question for longer of exactly what you want to say. You can think about every single word choice, and whether that sentence is really a good idea. You’ve got time to calm down, at least a little. And most importantly, you’ve ended the conversation before you’ve said anything stupid. This is key, key, key. As part of this, you’ve ended the conversation without even a minor breach of social decorum! This sounds stupid, but it’s really important. Social decorum dictates behavior all the time, and so you must have your default response be psychologically easy.

The next step, after you hang up the phone (and again when you finally get their questions), is to phone somebody whose opinion you trust (ideally someone as close as possible to the cold state, well-informed version of you), and tell them what happened. You may be panicking, but the other person will be in a cold state. They will help calm you down, at least somewhat. A second opinion from a trusted cold state source is incredibly valuable. They’ll likely know what cold state you knows – the best response is usually to shut up.

Then the journalist emails you questions. What next?

The only response they should get is this:

“I wish to enter a binding legal contract with you, your editors and your publication. I will only answer your questions on the condition that you either print my answer in its entirety, or not at all.  If you and your editor agree to these terms, please both let me know.”

This may be surprising, but journalists will mostly stick to these agreements. This immediately disarms one of their most powerful weapons, namely cutting and pasting your quotes to make you look bad. Secondly, even if they don’t print your answer, this makes it much harder to say that you refused to comment. You did comment, they just refused to print it. Journalists can smear, and distort, and omit, and deceive by suggestion. But outright lies about bare facts (did he respond or not?) are more apt to get them in professional trouble, so are taken more seriously. 

And now, you can decide what, if any, very carefully worded and brief answer is appropriate. Run this by multiple people. If you have someone you trust a lot, but who doesn't share your political views, they are especially valuable to include. If the journalist says they have a 5pm deadline, say that won’t be enough time, but you should (not "will") be able to give them an answer by 5pm the next day.

The more you delay, the more you talk to other people, the more likely it is that you’ll make the right choice. The more you do anything on the spur of the moment, the more likely it is that it will be rash, foolish, and ill-advised, and you will spend years regretting it. If in doubt, try to condition your panic response to be silence and delay.

It’s not for nothing that the header image at Overcoming Bias is Ulysses tied to the mast, while his mariners have their ears stopped up. We don’t have anything quite that foolproof. But the principle is the same.

When the sirens seduce you with their song of promises that you can talk your way out of this, you must know that you’ll be enormously tempted, in ways you can’t fathom now.

And you must plan accordingly.

Crazy is not a hypothesis

One of the criticisms I sometimes hear of behavioral finance, mostly from the rational crowd, is that one is just showing that 'people are crazy' or 'people are stupid'. This is always said dismissively, as if such an observation were trivially true and thus unworthy of observation or elaboration.

The first indication that this is a vastly overblown criticism is given by the fact that, despite the claimed triviality and obviousness of people's stupidity and craziness, these traits don't seem to find their way into that many models - the agents in those models are all rational, you see.

Well, actually, it's a bit subtler than that. Stupid agents have actually been in models for quite a while now, most notably in models that include noise traders, trading on false beliefs or for wholly idiosyncratic reasons.

But agents who could be described as 'crazy' are harder to find - acting in completely counterproductive or irrational ways given a set of preferences and information. So why is that?

The reason, ultimately, is that 'crazy' is usually not a useful hypothesis. It's a blanket name given to a set of behaviors that falls outside of what could be considered rational behavior, or even partially rational (such as kludgy rules of thumb or naive reinforcement learning).

And the reason you know that crazy isn't a useful hypothesis is that it tells you very little about how someone will act, other than to specify what they won't do. How would you go about modeling the behavior of someone who was truly crazy? Maybe you could say they act at random (in which case things look like the noise traders that we labelled as stupid). But are you really sure that their behavior is random? How sure are you that it's not actually predictable in ways you haven't figured out? It seems pretty unlikely that there are large fractions of traders who are in a bona fide need of institutionalisation in a sanitorium, if for no other reason than someone who was really bonkers would (hopefully) struggle to get a job at the JP Morgan trading desk or acquire enough millions of dollars to move financial markets.

The whole point of behavioral economics (and abnormal psychology before it) is to figure out how people are crazy. When someone is doing something you don't understand, you can either view it as mysterious and just say that they went mad, or you can try to figure out what's driving the behavior. But madness is an abdication of explanation.

Good psychiatry reduces the mystery of madness to specific pathologies - bipolar disorder, psychopathy, depression, autism, what have you. 'Madness' functions as the residual claimant, thankfully getting smaller each year.

Good behavioral finance ultimately strives at similar ends - maybe people are overconfident, maybe they use mental accounting, maybe they exhibit the disposition effect. These are things we can model. These things we can understand, and finally cleave the positive from the normative - if rational finance is a great description of what people should do but a lousy description of what they do do, then let's also try to figure out what people are actually doing, while still preaching the lessons we formulated from the rational models.

To say that behavioral finance is just 'people acting crazy' is somewhat like saying that all of economics can be reduced to the statement 'people respond to incentives'.  In a trivial sense, it may not be far from the truth. But that statement alone doesn't tell you very much about what to expect, as the whole science is understanding the how and the why of incentives in different situations - all the hard work is still to be done, in other words.

It's also worth remembering this in real life situations - when someone you know seems to be acting crazily, it's possible they have an unusual form of mental illness as yet unknown to you, but it's also possible that you simply have inadequate models of their preferences and decision-making processes. Usually, I'd bet on the latter.

Of Behavioural Red Flags and Unfunded Campaign Promises

One of the key meta-points of the rationality crowd is that one needs to explicitly think about problem-solving, because one's intuitions will frequently be wrong. In general, sophistication about biases is crucially important - awareness of the possibility that one might be wrong, and being able to spot when this might be occurring. If you don't have that, you'll keep making the same mistakes over and over, because you won't consider that you might have screwed up last time. Instead, the world will just seem confusing or unfair, as unexpected (to you) things keep happening over and over.

For me, there are a number of red flags I have that indicate that I might be screwing something up. They're not ironclad indications of mistakes, but they're nearly always cause to consider problems more carefully.

The first red flag is time-inconsistent preferences (see here and here). When you find yourself repeatedly switching back and forth between preferring X and preferring Not X, this is usually a sign that you're screwing something up. If you go back and forth once or twice, maybe you can write that off as learning  due to new information. But if you keep changing your mind over and over, that's harder to explain. At least in my case, it's typically been due to some form of the hot-cold empathy gap - you make different decisions in cold, rational, calculating states versus hot, emotionally charged states, but in both types of state you fail to forecast how your views will predictably change when you revert back to the previous state. I struggle to think of examples of when repeatedly changing your mind back and forth over something is not in fact an indication of faulty reasoning of some form.

The second red flag is wishing for less information. This isn't always irrational - if you've only got one week to live, it might be entirely sensible to prefer to not find out that your husband or wife cheated on you 40 years ago, and just enjoy the last week in peace. (People tempted to make confessions to those on their deathbed might bear in mind that this is probably actually a selfish act, compounding what was likely an earlier selfish act). But for the most part, wishing to not find something out seems suspicious. Burying one's head in the sand is rarely the best strategy for anything, and the desire to do so seems to be connected to a form of cognitive dissonance - the ego wanting to protect the self-image, rather than admit to the possibility of a mistake. Better advice is to embrace Eugene Gendlin

What is true is already so.
Owning up to it doesn't make it worse.
Not being open about it doesn't make it go away.
And because it's true, it is what is there to be interacted with.
Anything untrue isn't there to be lived.
People can stand what is true,
for they are already enduring it.

The third red flag is persistent deviations between stated and revealed preference (see, for instance, here and here). This is what happens when you say you want X and are willing to pay for it at the current price, and X is within your budget set, and you keep not purchasing X. The stated preference for liking X is belied by the revealed preference to not actually buy it. Being in the budget set is key - if one has a stated preference for sleeping with Scarlett Johannson but is not doing so, this is unlikely to be violating any axioms of expected utility theory, whatever else it may reveal.

Conflicts between stated and revealed preference may be resolved in one of two ways. As I've discussed before, for a long time I had a persistent conflict when it came to learning Spanish. I kept saying I wanted to learn it, and would try half-heartedly with teach yourself Spanish MP3s, but would pretty soon drift off and stop doing it.

This inconsistency can be resolved one of two ways. Firstly, the stated preference could be correct, and I have a self-control problem: Spanish would actually be fun to learn, but due to laziness and procrastination I kept putting it off for more instantly gratifying things. Secondly, the revealed preference could be correct: learning Spanish isn't actually fun for me, which is why I don't persist in it, and the stated preference just means that I like the idea of learning Spanish, probably out of misguided romantic notions of what it will comprise.

Having tried and failed at least twice (see: time-inconsistent preferences), I decided that the second one was true - I actually didn't want to learn Spanish. Of course, time-inconsistency being what it is, every few years it seems like a good idea to do it, and I have to remind myself of why I gave up last time.

Being in the middle of one such bout of mental backsliding recently, I was pondering why the idea of learning another language kept holding appeal to me, even after thinking about the problem as long as I had. I think it comes from the subtle aspect of what revealed preference is, this time repeated with emphasis on the appropriate section:

when you say you want X and are willing to pay for it at the current price, and X is within your budget set, and you keep not purchasing X

Nearly everything comes down to actual willingness to pay. Sure, it would be great to know Spanish. Does that mean it is great to learn Spanish? Probably not. One thinks only of the final end state of knowledge, not of the process of sitting in the car trying to think of the appropriate Spanish phrase for whatever the nice-sounding American man is saying, and worrying if the mental distraction is increasing one's risk of accidents.

Of course, it's in the nature of human beings to resist acknowledging opportunity cost. There's got to be a way to make it work!

And it occurred to me that straight expressions of a desire to do something have a lot in common with unfunded campaign promises. I'll learn the piano! I'll start a blog! I'll read more Russian literature!

These things all take time. If your life has lots of idle hours in it, such as if you've recently been laid off, then great, you can take up new hobbies with gay abandon.

But if your week is more or less filled with stuff already, saying you want to start some new ongoing task is pointless and unwise unless you're willing to specify what you're going to give up to make it happen. There are only so many hours in the week. If you want to spend four of them learning piano, which current activities that you enjoy are you willing to forego? Two dinners with friends? Spending Saturday morning with your kid? Half a week's worth of watching TV on the couch with your boyfriend? What?

If you don't specify exactly what you're willing to give up, you're in the exact same position as politicians promising grand new spending schemes without specifying how they're going to pay for them. And this goes doubly so for ongoing commitments. Starting to listen to the first teach-yourself-Spanish MP3, without figuring out how you're going to make time for the remaining 89 in the series, is just the same as deciding you want to build a high speed rail from LA to San Francisco, and constructing a 144 mile section between Madera and Bakersfield without figuring out how, or if, you're going to be able to build the whole thing.

And like those politicians you scorn, you'll find yourself tempted to offer the same two siren-song mental justifications that get trotted out for irresponsible programs everywhere.

The first of the sirens is that you'll pay for the program by eliminating waste and duplication elsewhere. Doubt not that your life, much like the wretched DMV, is full of plenty of waste and duplication. But doubt it not as well that this waste and duplication will prove considerably harder to get rid of than you might have bargained for. If your plan for learning Spanish is 'I'll just stop wasting any time on the internet each day'... yeah, you're not going to get very far. Your system 2 desire to learn piano is like Arnie, and your desire to click on that blog is like the California Public Sector Unions - I know who my money's on. The amount of waste you can get rid of is probably not enough to fund very much activity at all. Just like in government.

The second siren is the desire to just run at a budget deficit. The area of deficit that almost always comes up is sleep. I'll just get up and hour earlier and practice the piano! Great - so are you planning to go to bed an hour earlier too? If so, we're back at square one, because something in the night's activities has to be cut. If not, do you really think that your glorious plan to switch from 8 hours a night to 7 hours a night, in perpetuity, is likely to prove feasible (absent long-term chemical assistance) or enjoyable (even with such assistance)? Every time I've tried, the answer has been a resounding 'no'. I say 'every time' advisedly, as this awful proposal manages to seem appealing again and again. You can in fact live on less sleep for extended periods - just ask parents with newborn children. It's also incredibly unpleasant to do so - just ask parents with newborn children. They'll do it because millions of years of evolutionary forces have caused them to feel such overwhelming attachment to their children that the sacrifice is worth it. And you propose to repeat the feat to learn the piano? That may seem like a great idea when you start out for the first night, fresh from a month of good sleeping. It seems like less of a good idea the next morning when your alarm goes off an hour earlier than usual. And I can assure you it almost certainly will not seem like a good idea after a month of being underslept, should you in fact get that far. Iterate forward, and don't start.

The real lesson is to only undertake things that you're actually willing to pay for. If you don't know what you're willing to give up, you don't actually know if you demand something, as opposed to merely want it. Confuse the two at your peril.

Infidelity as a Commitment Mechanism

I've wondered a few times on these pages about the psychology of married people who begin affairs. As I wrote at the time:

As the length of the affair increases, the probability that your wife will eventually find out converges to 1. The chances that you'll slip up somehow, or get inadvertently found out through some voicemail, missed call, something, are too high.

And when that happens, the results are as predictable as they are horrible.

So how does it make sense to start down this path, rather than go for an honorable divorce now?

It’s entirely possible that the whole thing is just overconfidence, and the people involved think they can beat the odds forever. Maybe they’re just that stupid.

But I think I’ve figured out an alternative.

What if the eventual inevitability of getting caught is the feature, not the bug?

Suppose the unfaithful partner wants to be out of the relationship, but suffers from hyperbolic discounting. Even someone who has grown bored with their partner will still find it painful to tell their husband or wife that they want a divorce. You are wrenching the heart of the person you once loved enough to declare a lifelong commitment to. You want to be free of them, but that doesn’t mean you’re not dreading the process of getting from here to there.

So what will you do if you’re a hyperbolic discounter? You’ll procrastinate. You’ll convince yourself that you’ll leave your wife next month, or next year. And somehow next year turns into this year, and it never happens.

In this view, embarking on an affair is a sign of wanting out eventually, but not having the courage to just end it then and there. The affair is thus a commitment to eventually end the marriage at some unknown point when you get discovered. It functions somewhat like the Thaler and Bernartzi ‘Save More Tomorrow’ plan, or the complaint to the police by a domestically abused woman in a  no-drop jurisdiction. It’s the ‘Divorce More Tomorrow’ plan for those without the courage to tell their husband or wife that they want to leave. 

The indefinite timeline for discovery is also a plus – a known date would cause a lot of stress as it approached, and would create the risk of massive preference reversals. The unknown aspect means in addition that the final choice is taken out of the cheater’s hands, which benefits those who want to feel like the divorce was the process of some inevitable deterioration in the relationship, rather than an active choice by them (we grew apart, things didn’t work out, the knife went in).

My guess is that when the cheater is eventually discovered in their lie, once the initial shock is overcome, the next feeling is relief. Relief that things are finally drawing to the conclusion that they’ve long wanted, but haven’t had the courage to actually ask for.

It seems a strange explanation, but I can’t think of a better one.

Time-Inconsistent Male Hairstyle Preferences

In the world of male hairstyles, hair length functions something like a cross between mercury poisoning and a syphilis infection. Initially you have a small amount of hair, and you periodically treat the problem with scissors, as applied by a trained expert. You look around at the madmen in their ponytails, appearing like an obscene cross between the crying game and a manga appreciation society. "Ha!", you think. "I'll never look like those fools". And you don't. The hair keeps getting cut, the antibiotics get ingested, the madness is kept at bay, and everything goes on as normal.

But then some time in college, you get lazy and don't take your medicine. You start looking at your shaggy mop in the mirror, and the madness slowly takes hold. "Hey", you now reflect, "this actually looks pretty good! Luxuriant, even. Maybe I'll just let it grow for a while". What you don't count on is the fact that the hair itself is poisoning your ability to recognise what a clown you look like.

This is evidenced by the fact that more and more alarming warnings get completely ignored. Suddenly you need to wear a visor all the time to keep it out of your face. Next you're thinking of buying a headband. Finally, when none of that works, you convince yourself  that it would actually look good to have a full on pony tail. Chicks dig it, yo!

At this point, you have become the madman who doesn't realise he's gone mad. Friends and family gingerly try to intervene, but know it's a lost cause. They just have to wait until one day, you get sick of it and finally get a haircut.

And then, the mysterious cycle completes, in that within a few days you get used to it being short again. And after about a month or so, you look back on the long haired photos and reflect, "Wow, that really did look awful. I wonder why I let it grow for so long? I won't do that again".

But you might, reader. Like all time inconsistent preferences, when not poisoned by mercury you will struggle to forecast how you'll feel when in the throes of madness.

The Odd Psychology of Strip Clubs

(Previous thoughts on the psychology of strip clubs here, and male self-deception in relationships here and here.)

The standard complaint about strip clubs is that you're paying to not get what you actually want. In other words, you hand over however much cash to get a lap dance, and you don't actually end up sexually satisfied. Having never attempted to negotiate the transaction, I can't vouch for this, but I'm pretty damn sure that short of offering literally thousands of dollars, you won't get laid. I don't even know if that would work, certainly for many strippers in the US who explicitly see their job as distinct from prostitution. The woman won't get you off (except accidentally), and you won't even be able to touch where you want to, except on their rather limited terms.

Every conversation I've had with guys who paid for a lap dance indicated, privately, that there was little risk of matters escalating to, say, the Bill Clinton level or above.

Strangely, this fact has to be elicited from them in hushed terms - they typically don't like admitting straight out that they didn't get any immediate relief for their however-many hundred dollars. Maintaining the mystique serves the interests of both the stripper and the potentially embarrassed client. As I've said before, this isn't an accident - ambiguous expectations are at the heart of the strip club experience.

So if you believe the standard complaint, men like strip clubs but end up frustrated that they don't actually get any action.

Why is this puzzling though?

The puzzle is that if you actually wanted to get some action for sure, you could have just gone to a brothel and gotten laid with probability 1. Or gone to a bar and gotten laid with probability less than 1.

Taken at face value, it indicates some sort of market failure. Surely there should be more demand for clubs that blurred the line between strip club and brothel?

One answer that I can't rule out is that this is a legality issue - strip clubs are mostly legal, brothels are mostly illegal. In the places where prostitution is legal (e.g. parts of Nevada), I don't know that there's substantial business model innovation along the lines I describe. Maybe there is.

It could also be a quality issue - maybe the type of women who are prostitutes are of a fundamentally different group than strippers, and the male preference is distinct. I dunno though - do you really think the average guy at a strip club is that picky with who he sleeps with, provided the girl is willing? It's possible, but it seems unlikely.

On the other hand, we can pretty conclusively say that it's not a cost issue. Courtesy of Steven Levitt and Sudhir Venkatesh, here's some real-world data on how much it costs to get laid in Chicago with a prostitute:

In other words, no matter who you are, the average cost for most things you want is no more than a hundred bucks. If the average lap dance customer is paying less than this, I'll be highly surprised.

So, on face we have a puzzle - many men apparently pay a lot of money for women to take off their clothes and not sleep with them, and then complain about this afterwards. They do this despite passing up the opportunity to pay less money to get laid with certainty.

If the stated preference doesn't seem to make sense, maybe we can get further by hypothesising revealed preference and see where it takes us. The standard price theory assumption here is that the market is satisfying actual customer demand.

In other words, the fact that it's very hard to get laid at the strip club is actually the feature, not the bug. Even if men won't admit it.

The most obvious explanation for this is that men go to strip clubs in groups of friends such as bachelor parties, and in any such group there's going to be a large fraction, if not a substantial majority, for whom their commitments to wives and girlfriends mean that they actually don't want to get laid that night. If this were a possibility, then they might be tempted by hyperbolic discounting to do something they'll regret the next day (or, more likely, 5 seconds after it's done). If you've got commitment problems (in both the relationship sense and the behavioral economics sense), you want to go to the place where it's very difficult to do anything beyond looking at a distance.

Not only that, but the strong prohibition serves a useful signalling mechanism to wives and girlfriends. Consider the problem of the man who actually has no intention of doing anything untoward with random ladies that night, but who may not be able to credibly signal this to his wife. If you go to the strip club, your claim to having not done anything is credible. At a brothel, you're only there if you want to get laid. Even in my hypothetical innovative strip-brothel, the expected level of misbehaviour for an external observer is larger simply because the range of bad actions has expanded. By being easier to explain to significant others (or even just to rationalise to yourself), it means that the whole group is likely to attend, rather than the group splintering off or going for some consensus alternative.

The more interesting possibility, and one that's less discussed, is that even the people getting lap dances themselves would rather be at the strip club than at the brothel. They're not dragged away from the hookers by their more conservative friends. They actually don't want that, at least in revealed preference terms.

The standard model of male desire says that what men want is some combination of a) hot chick and b) orgasm.

Far be it for me to suggest that this model has no explanatory power. It does.

But I submit that this model of the world has difficulty explaining why lots of men go to strip clubs but not many go to brothels.

A more nuanced alternative would say that men definitely want the above things, but what they also want is to be desired by hot women. They want to conquer hot women, and feel them submit to their will. They want to feel the achievement of seduction, of power, of control.

Going to a brothel will satisfy the 'penis in vagina' aspect. But it will quite definitively not satisfy any of the other parts. Quite the contrary, in fact - it will reveal, in painful relief, how far you are from all the other things you desire about the courtship process. It will reveal you as desperate. Not to the rest of the world, who probably won't know. But to yourself, which is much worse.

In his novel, God Knows, Joesph Heller describes the situation of an aging King David. He has his various courtesans, but can no longer get aroused by them. The only woman who still holds his sexual interest is his wife, Bathsheba. But Bathsheba no longer desires him - her only interest is to try to get David to make her own son, Solomon, the next king in place of his elder son, Adonijah, whom he had with another woman.

Heller describes very aptly the paradoxical situation of the absolute monarch who, due to the difficulty of male desire, cannot have what he really wants

Abishag showed him the door and petted my heaving chest until she felt my exasperation abate. Then she washed and dried herself, perfumed her wrists and armpits, and removed her robe to stand before me a moment in all her wonderful virginal nakedness before raising a leg gracefully to enter my bed on one of her biscuit-brown knees to lie down with me again. Naturally, it did no good. I got no heat then, either. I wanted my wife. I want my wife now. Bathsheba does not believe this and would not let it make a difference if she did.

“I don’t do things like that anymore,” Bathsheba responds firmly each time I ask, and, if out of sorts, adds, “I am sick of love.”

She lost her lust when she found her vocations. Her first was to be a queen. Too bad that we had no queens. The next was to be a queen mother, the first in our history, the widowed mother of a reigning sovereign. I refused to trade and I refused to grovel. I could order her into my bed with a single cursory command, of course, and she certainly would be here. But it would be begging, wouldn't it? I am David the king, and I must try not to beg. But God knows that, by one means or another, I am going to lie with her at least one more time before I give up the ghost and bring my fantastic story to an end.

Worldly absolute power does not, alas, extend to making other people actually want you on the terms that you would like.

Being the absolute monarch of the commercial transaction is no different. Paying is begging through the medium of money. The problem is otherwise the same. 

In Heller's tale, David never does get Bathsheba to sleep with him. All the courtesans of the world, no matter how beautiful, are hollow in the end.

Abishag my angel has risen from her chair and approaches without noise, wearing only a vivid scarf. Her eyes are dark as the tents of Kedar. I want my God back; and they send me a girl.

Or as the band Gomez put it:

The things that are given, not won, are the things that you want.

"You Won!" - The sneakiest trick used by poker machines

Okay, as soon as I wrote that I realized that there’s probably dozens of sneakier ones I don’t know about, but this one I have at least observed. Poker machines are designed to frame the gamble so that you think you're winning more often than you actually are.

Consider how an economist would represent a poker machine-type gamble:

Probability          Total Payoff

0.7                          -1

0.15                        0

0.05                        1

0.02                        3

0.01                        5

Etc.

What this representation makes clear is that 70% of the time, you lose money, 15% of the time you break even, and 15% of the time you win in varying amounts.

But losing 70% of the time is too depressing. So they choose to present it differently, namely:

Probability          Revenue Payoff

0.7                          0

0.15                        1

0.05                        2

0.02                        4

0.01                        6

Etc.

This distinction is subtle but highly devious. Most importantly, the chance of you ‘winning’ under this new metric is now boosted from 15% to 30%. And who doesn’t love that! 

So how do the machines encourage you to follow the second way of thinking about the gamble?

The first is crude but effective - they glaringly displaying the text ‘You Won!’ when you get the 15% outcome. To anyone with two brain cells to run together, this is nonsense – you broke even, you didn’t win. But they encourage you to feel that rush of winning even when they’re not paying you any money.

The second way they do it is that the 1 unit gets subtracted as soon as you press the button, before the spin is decided. Only then is the payoff determined, and this is done in a separate step. The logic is like you’re “paying” every time to buy the gamble, like paying for the game itself. Then the payoffs are what you get afterwards

This alternative way of phrasing it obscures the fact that you’re losing 70% of the time, as opposed to just not winning. In prospect theory, this matters a ton – people really care about the first penny of losses. But here, they encourage you to put the money you pay initially into a separate mental account, as just a base cost of playing. The “payoffs” to the game, are thus only zero or positive. Just ignore that steady drip-drip-dripping of money, it’s just the cost of doing business.

The honest poker machine would be forced to display equally brightly the text ‘You Lost!’ every time you rolled and lost money, and report payoffs at the time of the gamble realization so that people identified more cleanly which are the loss states. If you got that rubbed in all the time, maybe you’d react differently.

But then you wouldn’t play the poker machines as much. And frankly there’s dozens of ways to get people to gamble less, but nobody’s much interested in investigating what they are. Still, at least Richard Thaler would approve of this one. 

In Defence of Wasted Food

There was a CNN article on Hacker News recently complaining about the amount of wasted food in America today.

Forty percent of food in the United States is never eaten, amounting to $165 billion a year in waste, taking a toll on the country's water resources and significantly increasing greenhouse gas emissions, according to a report from the Natural Resources Defense Council released this week.

The group says more than 20 pounds of food is wasted each month for each of 311 million Americans, amounting to $1,350 to $2,275 annually in waste for a family of four.

While wasted food is certainly not aesthetically satisfying, I find myself somewhat in the minority by viewing this as rather cheerful news. 

The main reason is that this is a huge celebratory victory lap in the quest of human beings to overcome what was the central problem of their existence from roughly 1 million B.C. until about 1950-ish: namely how to secure enough calories to stay alive.

Doubt not this fact - people waste food only because they know that there's plenty more where it came from. If there were some enormous, prolonged civil emergency in America where the food supply became insecure and sporadic, you can bet your bottom dollar that hungry people would very quickly revert to eating everything still in their refrigerator, tasty or not, out of expiry code or not. 

The definition of "wasted food", or even "food" in general, is something that varies with how desperate the economic condition is. There's a reason that people eat brains, kidneys, tripe, etc. in much smaller quantities than they used to. You know why? Because back then, meat was so scarce that you had to eat the whole animal. But now, cheeseburgers are delicious and cheap. If you go back to, say, the Battle of Stalingrad, people got so hungry that they would eat literally anything that contained a calorie. They would boil old leather boots - leather is skin, and has calories. Lipstick, made from animal fat, became a dessert. Even those bemoaning food wastage probably don't boil their shoes when they've worn through them.

The other problem with this view of the world is that it ignores the fact that food has a significant option value. When I do the shopping, I don't know exactly how many times I'm going to be eating at home in any given week. Maybe dinner plans will come up, and I'll go out. Maybe I'll have a big lunch and not be hungry. Maybe I'll just not feel like cooking.

When I'm buying food with a short expiry date, I'm buying the option of eating it later. The nature of options is that they sometimes expire unused. This doesn't mean the option wasn't worth something, it just means that something better came along. 

The types of foods that tend to have short expiry dates (and thus are more likely to be wasted) are fresh foods - fruit and vegetables, milk, meat, cheese. If all you eat is baked beans and spam, you'll probably have not much wasted food. But you'll be eating less healthily. I imagine that wasted food is probably also correlated with aspirations (unsuccessful, perhaps) towards healthy eating. You buy the broccoli thinking that you'll eat it. Maybe you go for a hot dog instead - hyperbolic discounting springs eternal. But if you never bought the broccoli, you would have eaten the hot dog with certainty.

I figure you always want to keep an eye on what the counterfactual is. Wasted food is generally fresh food. It would be nice if the counterfactual were more efficient consumption of fresh food. But it's probably just more processed food instead. Be careful what you wish for.

Nice ' n ' Smooth Exponential Discounting

So I managed to be perhaps the last person in America to watch 'The Dark Knight Rises'. It reinforced everything I've thought about the fact that seeing movies when they first come out is just hyperbolic discounting on stilts. I got to see it in IMax, in the middle of the afternoon on a Saturday, at a really centrally located seat, and without having to queue up days in advance.

Now I just need to go back to Reddit from six weeks ago and read all those 'Good Guy Bane' memes that I was deliberately avoiding.

The one plot twist that I thought was going to happen (and would have been really excited to see) was when Bane took over the stock exchange. I was hoping that they'd put up fake data saying that the NYSE had fallen 80%, T-Bills had fallen 40% and that the entire economy was collapsing. That would definitely have had a huge destructive effect on markets around the world, and may have had persistent effects even after the truth was known. Sadly, they didn't do that direction.

Stop playing with your damn phone and talk to the person in front of you

One of the most striking modern pathologies is the nervous twitch of obsessively checking one's phone.

I use the terms 'obsessive' and 'pathology' advisedly. People will check their email literally hundreds of times a day, even though they might get only 15 emails (if that). And most of the emails are rubbish anyway. How many of them couldn't wait half an hour until you were back at your computer?

Now, ordinarily I'd just put this down to de gustibus non est disputandum. If people want to spend all their lives poring over a tiny screen, that's their business.

But as a question of manners, I find it strange how much obsessive phone checking intrudes into otherwise polite situations.

Last night, I was out at a quite nice restaurant. At the table next to me was a couple, late 20's or early 30's. Quite stylishly dressed. I overhead them say to the waiter that they were on holiday from Dallas.

And yet during the meal, when I glanced over the guy was on his phone continuously for perhaps a two minute stretch at least (or happened to be on it both times when I glanced over). Phone in his lap, head down tapping away. The girl was sitting there poking at her salad, looking bored. It didn't look like the guy was quickly checking wikipedia to settle an argument as to whether the English side in the Battle of Hastings was lead by King Harold or Ethelred the Unready. It looked like he was just zoning out to do his own thing.

Seems like a funny way to spend an evening at a nice restaurant with your girlfriend.

Now, in some ways this isn't the most perplexing case though. Phones are a great way to deal with boredom and social isolation. Perhaps they'd just ran out of things to say, and the guy wasn't good at dealing with silences. It's still somewhat poor form, but understandable.

No, the truly bizarre trait is the people who'll compulsively check their phone while carrying on a conversation (at 50% attention level, of course). That's just plain rude. It's saying that the discussion with the other person is not worth your full attention. Would you just pick up a newspaper and start reading when the other person was in mid-sentence? Would you turn on the TV? No! So put down the damn phone.

This is a trait concentrated almost for the most part in young people. This is partly because they're more technology-obsessed to begin with, and partly because they were less likely to be raised with proper manners. They get used to fiddling with it, and nobody calls them out on it.

Well, screw that. If you're hanging out with me, and I like you enough to consider you a friend, you're going to get called out on it. 'Are we playing phones? Woo! Email!'. Or I'm going to do my annoying thing of swatting at the phone while telling you 'Put it away! Put it away!'. (If you're someone I don't know well enough to do this too, I'l just be quietly judging you as having poor breeding, while deciding if I can extricate myself from your boorish company).

And for the most part, people will put it away without too much hassle. Because they themselves know that they weren't really expecting to find anything more interesting there, and that it basically is just a nervous twitch. (If people really are expecting a particular email or text message, they'll usually apologise and say so, which is always fine).

One alternative to it being compulsive is that they genuinely prefer the company of whatever person they're communicating with by email or text message. You can rule this one out easily by noting that if you reversed the roles of 'person in front of them' and 'person on the other end of the text message', they'd still be doing the same thing.

Another is that social discourse has become sufficiently shrivelled that modern teenagers actually prefer to communicate electronically than face-to-face. This is probably part of it - I note an increasing discomfort among young people to speak to anyone on the phone - you'll call them, and they'll text message you back. (Again, this is likely to get you mocked by me). But how do you explain the behaviour by people who are outgoing and gregarious? They don't have any reason to avoid real conversation. Instead they just want to get the positive buzz of an email or text message and (sort of) continue the conversation. It might be that they're selfish in assuming their time is more valuable that yours. It might also be that they're equally happy for you to be doing the same thing back (which seems like one of Dante's circles of conversational hell). It's both hilarious and scary to watch groups of teenagers all sitting around, all playing on their phones and half-talking while texting whichever of their friends aren't immediately in front of them.

The one saving grace in all this is that I'm old enough that my generation doesn't communicate so much by text message, so most of the obsession is on the email front. Because of the immediacy and greater intrusiveness of text messages, people feel the need to respond quickly. But then the other person responds back, and now you're doing nothing but text messaging each other back and forth. At least with email, if there's nothing there when you check, you have to face up to the rejection and go back to the person in front of you. Text messages succeed more with the phone-obsessed  because they provide a never-ending stream of distractions.

Do you ever find yourself  laughing at the idiots playing farmville on facebook, obsessively logging in to water their crops every four hours so that imaginary animals don't die?

Don't. The psychology of people gettting stuck in stupid hedonic feedback loops and ending up doing obsessive things is exactly the same as compulsive phone checking. Farmville just figured out how to turn a profit on it.

And so, in their own way, did the phone companies. It's not for nothing that the prices charged on text messages are astronomical relative to their cost to send. Addicts will always pay up.

Sporting Overconfidence, Part 2

The second effect of overconfidence on the sports field is that people over-invest in the sport.

In other words, when you think you have high skill, the rewards to training are higher, because you could go on to be a superstar. And in truth, the extra training will be useful, as training always is. You will improve because you train heaps.

But the margin on which you'll make a mistake is that you'll overinvest in the sport relative to what else you could be doing with those hours - hanging out with your friends, learning Russian, snorting meth, whatever your chosen avocation is.

Unfortunately, this creates even worse effects when everyone else is overconfident too. When you know that all the other teams are likely to overinvest because they're overconfident, it means that you'll need to train that much harder in order to beat them. In other words, even if you aren't overconfident yourself, the only way to beat the other teams is to act as if you were overconfident.

Once again, behavioural economics comes to the rescue, with the sage of advice of 'Can't win, don't try, spend your time enjoying life instead'. Not exactly the stuff of inspirational speeches.

But sod it! There's more to life than winning on your six-a-side soccer tournament. How about just enjoying yourself?

The second obstacle to this is the team structure. The team captain is usually among the most psyched up about the team's chance. So you often get conversations like the following:

Captain: I was thinking we'd train three times a week. You guys agree, right?

Everyone else: *shuffle feet, don't want to be seen as the lazy one*.

It takes an unusually bold person to demand that everyone train less because they personally are lazy. But then the consensus answer is always more training, even if that's not what most people want.

If I were running things, I'd start out the first meeting with the following:

'Okay, I want everyone to write down on a piece of paper the number of hours per week they'd like this team to train, ranging from zero to five. We'll put all the pieces in a hat, then draw them out, and whatever is the median answer will be how much we'll train.'

And my team will probably get our butts kicked! But it won't matter, because we'll be doing other fun stuff and not viewing training as being a chore.

Did I mention I'd make a rotten team captain?

"We're better than those guys

Statisticians rarely make good members of sports teams.

I found this out the hard way when I used to be on a frisbee team. Most people run on overconfidence. I've had numerous arguments with people over whether this makes sense or not. The general view is that if I psych myself up that we're going to win, I'm going to try harder to make it happen. If I believe I'll fail, I'll be demoralised and not try hard.

The idea is thus that belief in success and failure has a self-fulfilling component. Only a component, mind you - if I really truly believe I can beat Kobe Bryant to the net in a game of one-on-one, I will fail. But I'll still have a better chance than if I don't believe in myself.

Frankly, I was always a bit skeptical of this argument, as it reeks of a second-best solution. In other words, if you're being rational, better answers are unlikely to come from deliberately feeding in faulty inputs. Including your chances of victory. This only works if it's the workaround to some other faulty process - one bias (inability to try hard in the face of failure) is offset by another bias (convincing yourself that you won't fail).

But I remain committed to the belief that the first-best solution is always to eliminate the biases - in this case, figure out how to try hard even if you do think you'll lose.

Since this is what I aim at, I want to know the true probability, and work from there. It's a fair bet that most other team members (if they're non-economists or non-statisticians) won't feel that way. They'll view you as a negative nancy.

I remember this came to its zenith when we were down at half time. The captain of the team was trying to get us fired up. He said 'hands up who thinks we're going to win this game'. About half the team put up their hands. He responded, 'Right, you guys are on the field'. Personally, I thought this was absurd, but that's probably part of the reason I never got made captain.

The net effect of all this is that you end up with the absurd result that on any given sports field, at least 70% of the players think they're going to win. They think that they're better than the other team. Talk about the Lake Wobegon Soccer team effect.

It also leads to a hilarious misconception of what it means to be 'better' than the other team. For most people, if they lose on a knife-edge, they'll be bitterly disappointed.

But the statistician sees it differently.

If we play against a really rubbish team, we'll win about 95% of the time. Then we'll advance higher, and play a better team, that we'll beat 70% of the time. We'll advance higher still, until we're playing a team that we have an edge over, but it's tough - we might win 60% of the time. 

And eventually, we'll get to a point where we're playing against a team that's very evenly matched. We'll have a 50% chance of winning. And we might just end up in a 16-16 game to 17. And someone drops the disc, and the other team scores. And we lose.

The non-statistician weeps.

The statistician is sanguine. In expectation, we got exactly where we should have. We bet on a fair coin, and it  came up tails. This time we lost. Next time we'll win.

But there's no disappointment just because the coin landed on tails.

Funnily enough, that might make for a reasonable consolation speech afterwards. It would certainly have a better likely effect relative to the 'we're probably not going to win, but I plan to try jolly hard anyway' speech.

On the other hand, I'd would be much more inspired by the speech that talked about the true probabilities.

After all, not everybody who's willing to face up to true probabilities is necessarily a coward. The best response to likely defeat is to stare the truth in the face, and give it the finger.

Relative Scarcity in Exotic Travel

If you ever want an example of just how fickle people's preferences really are, look no further than their choice of holiday destinations.

The context I came across this in is the relative perception of Bali and Mexico.

To Americans, Bali is a land of exotic beaches, beautiful resorts and interesting locals. It's a good choice of honeymoon destination, and a holiday choice designed to make people thoroughly envious.

Mexico, on the other hand, is the crass and unoriginal place where low-rent rednecks go to drink cheap beer and stay in some generic resort.

To Australians, hilariously, the perceptions are exactly reversed. Bali is the place where football teams go for their boozy holidays, and you meet lots of other derelict Australians. But Mexico is enticing, with delicious food, amazing beaches, and Corona everywhere you look.

The reality is that both places are pretty similar - they provide fairly easy beach holidays with a range of accommodation options, and attract a lot of locals from their richer nearby neighbours - Americans go to Mexico more, and Australians go to Bali more.

But the relative scarcity of each place determines in part how it's perceived in each country.

As far as I can tell, there's two likely explanations.

The first is that this is about bragging rights - you need to go somewhere special so that you can boast to your friends, and even though Bali might be similar to Mexico, you choose the one that sounds better and makes you feel well travelled when you get home.

The second is that there's a self-fulfilling prophesy going on with accommodation spending. When you spend two grand on an airfare, you're more likely to stay in the expensive resort upon arrival. This makes the place seem super lush, and you go back and tell your friends how great it is. When you spend five hundred on the airfare, you stay in some cheap motel with the other budget travellers, and this reinforces the impression of a bargain kind of place.

While #2 might sound kind of rational, it's hard to reconcile with a proper search of the options - if you're American and want a nice holiday but don't care about what anyone else thinks, why don't you just stay in a nicer hotel in Mexico?

I'm led to believe that #1 must have something to do with it. But strangely, I don't think this is explicit - the Americans I know who went to Bali truly believed that it really was completely different from Mexico in lots of essential dimensions. As a result, they didn't seem especially thrilled when I pointed out that to Australians, Bali was basically like Mexico.

In other words, bragging doesn't work unless you've also convinced yourself that this was a better option. Cognitive dissonance, anyone?

Gravity and the Curse of Knowledge

The problem with knowing something is that it makes it very hard to accurately put yourself in the shoes of someone who doesn't know it. Try as you might, it's very difficult to properly imagine the thought processes of someone who lacks knowledge. Things you know always seem obvious, even though they're not obvious at all when you don't know them. Psychologists call this the curse of knowledge.

When you suffer from the curse of knowledge, previous generations tend to look remarkably stupid. How can anyone believe the earth was flat? What morons they must have been!

But think about it - do you believe that humans now are genetically much smarter than people 500 years ago? Or are you just taking for granted the obviousness of the things that someone else told you, but you didn't have to figure out for yourself. I'd say you're safer to bet on the latter.

One case that always struck me was gravity. The earliest theories of gravity were from Aristotle's Physics. If you fired a cannonball, that cannonball would proceed in rectilinear motion, then fall straight back down to the earth. This was because it was made of the earth element, which wanted to be close to the earth.

So this predicts that if you fire a cannonball, it should look like this:

So here's the problem - clearly cannonballs don't actually fly like this! Now, admittedly it's hard to trace out the path of a rock in the air. But there's one very easy way for (male) physicists to check - just look at the path of your urine when you take a pee! Does it look like a triangle shape? No, not even close. It looks like a parabola. And that should immediately suggest a relationship of y = x^2 . 

It took until Newton, almost two millenia after Aristotle, to formalise a better theory of gravity. This theory actually predicted that the cannonball should follow a parabolic shape:

So why did people take so long to figure this out? Couldn't they see that the relationship was a parabolic  y = x^2, and figure out the rest from there?

Oh, you fools, cursed by knowledge! The first step is the known knowns - the curses you know you have. You know that you know about gravity, and thus your ancestors not knowing seems particularly idiotic.

But what about the unknown knowns - the curses that you don't even know you have?

Let's step back a second - when exactly in human history did people even have a clear idea of what a parabola was, and what y = x^2 meant?

When you draw a graph of y versus x for some function, the area you draw it on is known as a Cartesian Plane. This is named after Rene Descartes, who lived from 1596 until 1650.

In other words, even the idea of graphing y versus x (for anything, let alone being able to spot a parabola) dates all the way back to ... the 17th Century. 

Are you starting to see how much you're taking for granted when you look at modern science and think of how dumb people in the past were.

Rene Descartes was a muthaf***ing genius. And that's how smart you had to be to even come up with the idea of drawing a parabola on a graph, let alone understanding what that might have implied about a theory of gravity.

Understanding the curse of knowledge leads to a much greater humility about previous generations. The vast majority of your knowledge is unearned by you, and if you hadn't had it gifted to you by the accumulated wisdom of generations of men much smarter than you, it's highly doubtful that you would have figured it out on your own.

Just like your ancestors didn't.

The False Consensus Effect, Geography, and Going to University

Apologies for the lack of updates - I've been hanging in Miami for a few days.

And this got me thinking about the false consensus effect. After the sunk cost fallacy, the false consensus effect is probably one of the biases that tends to lead you astray the most. As wikipedia describes it:

[T]he false consensus effect is a cognitive bias whereby a person tends to overestimate how much other people agree with him or her. There is a tendency for people to assume that their own opinions, beliefs, preferences, values and habits are 'normal' and that others also think the same way that they do. This cognitive bias tends to lead to the perception of a consensus that does not exist, a 'false consensus'.

The false consensus effect seems to show up the most when you're not explicitly thinking about 'what do other people want, as evidenced by the things they do and say?', and instead just think 'what is desirable?'. Because implicitly the second question is really asking 'what do I think is desirable', and then extrapolating this to everybody.

People seem to do this a lot with preference for places to live. I tend to be in the category of people who prefer large coastal cities, ideally with warm weather. And it's easy to think that everyone wants these things. But at least according to revealed preference, they don't. Lots of people want to live in Toronto and Chicago and other cold weather cities. Lots of people really dislike temperatures above 80F (~27C). Lots of people want to live in middle-of-nowhere small towns, and can't stand the thought of having to drive half an hour to get to work.

Now, none of these are strong preferences for me. But the mistake is thinking that people who live elsewhere have the same preferences as you, but just have different constraints. He lives in that tiny town because his family is there. She lives in Chicago because it's the only place she can get a job. But if you took those things away, then surely everyone wants to live in Miami.

No, no they don't. You want to live in Miami, but maybe they just want different things than you do.

Now, if people are pressed, they can imagine that such alternative preferences might conceivably exist. But the perniciousness of the fallacy is that it's easy to get slack and just extrapolate your own preferences without thinking explicitly about whether they are going to be shared in this particular case. It's easy to overestimate how much your preferences are common to everyone.

Preference for geography is a very mild example of this bias. But it's a bias that's easy to slip into on all matters. And it gets even worse when the preferences are crazily different from your own.

I remember Mark Steyn had a very sharp observation about this a few years ago, when discussing Condoleezza Rice's views on the preferences of the Palestinian people:

"The great majority of Palestinian people," Condi Rice, the secretary of state, said to commentator Cal Thomas a couple of years back in a report that first appeared on JWR, "they just want a better life. This is an educated population. I mean, they have a kind of culture of education and a culture of civil society. I just don't believe mothers want their children to grow up to be suicide bombers. I think the mothers want their children to grow up to go to university. And if you can create the right conditions, that's what people are going to do."

Thomas asked a sharp follow-up: "Do you think this or do you know this?"

"Well, I think I know it," said Secretary Rice.

"You think you know it?"

"I think I know it."

I think she knows she doesn't know it. But in the modern world there is no diplomatic vocabulary for the kind of cultural fault line represented by the Israeli/Palestinian dispute, so even a smart thinker like Dr. Rice can only frame it as an issue of economic and educational opportunity. Of course, there are plenty of Palestinians like the ones the secretary of state described: You meet them living as doctors and lawyers in Los Angeles and Montreal and Geneva but not, on the whole, in Gaza.

Let us put aside for the moment the contentious questions of Palestine and Islam specifically, and consider purely as a matter of demographic estimation exactly how many mothers in the world would prefer their children to die in some military action than to go to university. Assuredly such people exist. Their preferences may seem bizarre to you and me. But the point is that it will always be tempting to assume that people with preferences so different from your own must necessarily be in the tiny minority. In fact, these are the types of issues that the false consensus effect is likely to impact the most.

In other words, when you are forced to estimate the prevalence of opinions widely different from your own, you would do far better to begin by examining specific data that bear on the question - survey responses, election outcomes, whatever, - rather than just assume that deep down, everyone must want the same thing as you.

Forget the Palestinians, and consider this instead. Back in 1994, thousands of Rwandan Hutus woke up each morning, and rather than 'just wanting a better life' as Condi Rice understands the term, what they actually wanted was to hack lots of Tutsi civilians to death with machetes. And they did so. For 100 days in a row.

Sometimes a group of people can have entirely consistent, widely shared preferences that are radically different from your own. What you do with that knowledge is up to you, but you do yourself no favours by pretending to the contrary.