CHAPTER 1
THE PURSUIT
Most of us go through life believing we know exactly what we need to make us happy. For the most part, we believe that all we ever need is to have someone we love loving us back. Or itās a combination of more money, a good job, a stable marriage and perfect health. Sometimes itās the little things in life, like a day off work; a clear blue sky on an autumn afternoon; a nice cup of cool mochaccino on a hot day; an hour-long foot rub; a day spent laughing with friends and family; 45 minutes of uninterrupted sex with our partner, and the energy to last for the best part of it.
But unfortunately ā in the words of Mick Jagger and Keith Richards ā we canāt always get what we want. At least, we canāt always get what we want all the time. A day off work every so often sounds like a good idea until, of course, we realise that we will become a little poorer because of it. And thatās no good because, according to the abstract idea we have in our heads of what makes a good life, money matters a lot. Okay then, in that case, weāll put in more hours at work. But wait. That will also mean less time to be spent with friends and family, and that doesnāt seem so good either.
So what do we do, then? What do we do when our lives are a series of trade-offs between different combinations of āwhat ifsā? What do we do when there is an endless horizon of time and resource constraints constantly telling us that whatever we do, we canāt possibly have it all? Well, according to economists, who are supposedly experts on decision-making, what usually happens is that we try to do the best we can with our choices. We gather all necessary information about our options. We engage in rationalisation and mental calculations. We quietly argue and debate within ourselves over the potential impacts of each individual decision on our happiness. We cross-refer them to the rule-book of āAll the things that make me happyā, put each possibility into an order of preference, and then, subject to both time and resource constraints, choose the best combination of bundles that we know would optimise our well-being.
Easy.
Bounded rationality
But of course, if that were true ā if we always chose the best possible combination of options according to stable preference functions and the constraints facing them ā then the way we led our lives would literally be disappointment-free. Whatever decisions we made, we would know exactly well in advance what we were getting ourselves into. After all, our rationality would have already done the homework for us: we would be getting the greatest reward at the lowest cost.
How could we possibly not be happy with that?
The reality, however, is that our lives are too often filled with disappointing and regrettable decisions, whether big or small. The holiday we went on last summer; that antique car we bought; or even the job or college degrees we picked. The following anecdotal evidence from a chance meeting between two economists and a dentist makes it all too clear.1
Two economics professors and friends, John Bennett and Chuck Blackorby, were attending an economics conference. On the first evening, they met a dentist at the hotel bar who was at an annual conference for dentists just next door to them. After a brief introduction and a couple of drinks, Chuck, who was known for his sometimes brash and direct manner, decided to ask the dentist, by then a little tipsy, a somewhat personal question.
āSo, tell me, are you very happy being a dentist?ā
āHappy? Iām miserable as a dentistā, replied the man.
Chuck smiled to himself. āWhat? If youāre so unhappy, why on earth did you choose to become a dentist in the first place?ā
āI didnāt choose to become a dentist.ā The man took another swig of his drink before delivering the final hammer blow. āItās that stupid kid eighteen years ago that chose to become a dentist. Not me.ā
And even when weāre not too disappointed; when we actually think weāre fairly satisfied with the choices we made, sometimes thereās just no way for us to know for certain whether or not we would have been happier if weād gone with the alternatives. Take having children, for example. For most parents, a natural and genuine response to the question, āWould you be happier without children?ā would be a screaming āNo!ā However, thereās no real way of knowing precisely what life would have been like if these parents had decided not to have their little David or Sarah ā simply because the childless alternative didnāt take place for them. The same argument holds true for partners who choose not to become parents.
One of the main reasons why we arenāt always able to choose the best options for ourselves is that our rationality is often bounded by the amount of information it possesses, the cognitive limitations of our brains,2 and the finite amount of time we have to make a decision.3 According to the so-called ābounded rationalityā concept, we human beings are only partly rational ā and downright irrational in the remaining part of our actions. While economists believe that all human beings are approximately Homo economicus (economic man), rational and broadly self-interested by nature, the reality is that we are just as likely, if not more likely, to let emotions overrule rationality and completely dictate the way we behave.
That we are not wholly rational is shown by studies that have identified two distinct sides to our brains: one that is rational ā controlled, slow, deliberative and deductive; and one that is emotional ā automatic, rapid, associative and affective.4 The mesh between the two is extremely complex, and one does not always dominate the other. And while economic theories of decision-making have tended to emphasise the operation of the rational side of our brain in guiding choice behaviour, itās often the case that, when making decisions under pressure or under conditions where information is incomplete or overly complex, we tend to rely on simplifying heuristics or āgut feelingsā rather than extensive algorithmic processing.5 These ārules of thumbā are far from perfect, and itās precisely why we sometimes spend too much money on food when we go grocery shopping with an empty stomach,6 or find it increasingly difficult to walk away from a bus stop the longer we have been waiting for a bus to come ā even if it would have been a lot quicker to walk than to wait for that damn bus to arrive.7
The adaptive unconscious and past experiences
But maybe itās not always such a bad thing to trust our emotions. Research carried out by psychology professor Timothy Wilson suggests that, in situations where we have had a lot of experience, decisions made without thinking (those made on impulses and gut feelings) can often lead to better and happier outcomes than if they had been made under a strict rule of optimisation, simply because this is when the emotional part of our brain works best at detecting that something is out of the ordinary ā even if we may not know ourselves what that something is at the time ā and alerts us in the form of emotional alarm bells such as sweaty palms and butterflies in our stomach.8 And itās in these scenarios that practice really makes perfect. Itās also where thinking too much about our past experiences can actually hurt rather than help us.
The question is: Why?
One reason. According to psychologist and Nobel laureate Daniel Kahneman, the cognitive part of our brain tends to suffer from what he called the āpeak-endā effect, which is the tendency to judge past experiences ā both pleasant and unpleasant ā almost entirely on how they were at their peak and how they ended.9
Kahneman and his colleagues illustrated the core concept of the peak-end theory in a series of experiments, most notably that involving hospital patients and the very painful colonoscopy procedure.10 While undergoing a colonoscopy, the patients reported their level of discomfort every 60 seconds throughout the procedure. Afterwards, the patients were asked to remember how unpleasant the procedure was, using several different scales including a ten-point scale, and also about the relative unpleasantness of the colonoscopy compared to other unpleasant experiences such as stubbing a toe, or an average visit to the dentist. What Kahneman and his colleagues found was astonishing. While there was almost zero correlation between the duration of the colonoscopies that different patients experienced and the global rating of the procedure, the relationship between the peak-end average (the average of the peaks and how the patients felt at the end of the procedure) and the global rating of the procedure was simply undeniable. In other words, we are more likely to remember our experience of a colonoscopy as being awful if the peaks of unpleasantness were very high or if it ended awfully for us, than if the entire procedure itself took a long time to finish. What matters is not the duration of an experience; we hardly ever think about it when we try to recall and judge how happy or unhappy we were in the past. Itās how we were feeling at the peaks and at the end of our experience that count the most.
What about frequency? Surely having experienced something often can teach us to repeat only the things that we remember with pleasure and fondness, and avoid those that we remember with embarrassment and regret? The trouble is, according to Harvard psychologist Daniel Gilbert, we are just not very good at remembering them correctly. He illustrates his point by prompting the readers of his book ā Stumbling on Happiness ā to think about where they were, whom they were with, and what they were doing when they first heard the news about the 9/11 attacks in 2001.11 Okay, that sounds easy enough. Closing my eyes, I can still remember that I was standing at one of the check-in counters at London Heathrow airport, trying to get on the evening flight to Bangkok. Sitting behind the Finnair counter was a man in his late 50s who, as I recall, spoke with a very thick Glaswegian accent.
āSo youāre off to Thailand then, eh? Ah, what a beautiful country! Lovely food, gorgeous beaches, very pretty women!ā His eyes twinkled as he said this.
I smiled politely, acknowledging his appreciation of my country of birth. I knew he was just trying to be friendly in what seemed to be a surprisingly empty airport on a Tuesday afternoon.
āOkay, sir. Hereās your boarding pass. Have a nice flight ā¦ Oh, and have you heard? Two planes hit the World Trade Center not half an hour ago. Probably a terrorist attack. But since youāre flying to Finland first, Iām sure youāll be just fine.ā He ended with a beam while I stood there, rigid as a board.
Like me, most people will be able to remember in fine detail what they were doing when they first heard the news. But, Gilbert added ā would the same people also remember precisely where they were, whom they were with, and what they were doing on the morning of 10 September 2001, one day before the attacks?
I personally couldnāt, of course. And Iām confident enough to bet that not many people could either ā a fact that is also true for most Americans.
The main reason why itās relatively easier for us to recall the exact details of 11 September 2001, but nearly impossible to remember what happened a day earlier, is because momentous events like the 9/11 attacks do not happen frequently in our lifetime. While 11 September 2001 defied our every sense of normality, 10 September, by contrast, was like almost any other day. And unless we religiously keep a diary of everything that ever happened in our lives, any other day is nothing more than a blob in our memory bank.
Daniel Gilbertās message is clear: it is the infrequent and unusual experiences that are most memorable. These are the ones that stick like glue to the clipboard of our memory cortex. Not the other way round.
Conventional wisdom and imagination
There are two lessons we can draw at this stage. The first is that, in situations where we have had a lot of experience, itās perhaps better to trust our instincts when it comes to making a decision. And the second lesson, related to the first, is that it seems important not to rely completely on emotions in situations where we have had little or no prior experience. The explanation is simple: in these circumstances, the emotional part of our brain will not have had enough chances to adapt and learn from our past experiences, which will inevitably make it impossible f...