
Daniel Gilbert's accessible account of affective forecasting — our poor ability to predict what will make us happy. His research on immune neglect and focalism is less cited than Kahneman's work but equally well-evidenced.
Gilbert, a Harvard psychologist, argues that people are systematically bad at predicting what will make them happy, and explains the specific mechanisms that produce the error. The book is about prospection, meaning the mental simulation of future experiences, rather than about happiness itself.
His argument has three parts. Imagination fills in details that are not there, so a simulated future contains invented specifics the person treats as given. Imagination leaves out details that will be there, particularly the ordinary context surrounding any imagined event, which is why people imagine a promotion or a move without imagining the daily conditions around it. And imagination fails to account for how the mind will reinterpret events once they occur, which Gilbert calls the psychological immune system.
The evidence includes work on affective forecasting showing that people overestimate both the intensity and the duration of their emotional responses to events, both positive and negative. Lottery winners and people who become paraplegic converge toward their prior baseline faster than anyone predicts. He also covers the finding that people rationalise outcomes they cannot change, which means the events people most fear are frequently ones they would adapt to.
His practical recommendation is surrogation, meaning asking people who are currently in the situation you are considering how they feel, which he shows outperforms imagining it yourself. He notes that people reject this advice because they believe they are unique. Some of the studies have replicated poorly, particularly in the affective forecasting literature where effect sizes are smaller than reported. Gilbert's writing style is heavily comic and some readers find it wearing. The core finding about impact bias holds.
Anyone making a large life or career decision on the basis of how they expect to feel afterwards.
Chosen by shared topics, the entries that hold them, and the people who recommended both.
Incerto volume 4
“Nassim Taleb, author of the new book Antifragile, praises volatility and criticises those who would artificially damp it at great unseen cost. Taleb advises us to be 'anti-fragile'. This is exactly…” — Seth Klarman
Source: Klarman on Taleb's praise of volatility and what Baupost strives for
Recommended by: Mohnish Pabrai, Nat Eliason and 25 others
Why people mistake luck for skill, above all in markets.
“Fooled by Randomness is a serious, intellectually sophisticated book, well worth reading carefully. At times, the book is condescending. Nevertheless, there are some great insights.” — Barton Biggs
Source: Biggs on a sophisticated book worth reading carefully
Recommended by: Barton Biggs, Michael Mauboussin and 11 others
Nudge: The Final Edition published 2021.
Recommended by: Tristan Harris
Experiments showing that people depart from rational choice in repeatable ways.
Recommended by: Mohnish Pabrai, Alfred Lin, Anna Cheng and 6 others
Mullainathan and Shafir's research on cognitive bandwidth shows that financial scarcity — not just poverty but any experience of not having enough — tunnels attention in ways that make long-term planning harder and short-term mistakes more likely. It reframes willpower-based explanations of financial failure without excusing the structural causes.
Recommended by: Mohnish Pabrai, Daniel Kahneman and 1 other
Experiments showing most cheating is many people cheating a little.
Recommended by: Mohnish Pabrai
Topics