Insights from ‘The Art of Thinking Clearly’ by Rolf Dobelli Flashcards
What is the extrapolation error or cluttering illusion?
It is the tendency to make big decisions based on small data sets, often interpreting short-term trends as significant.
Fill in the blank: ________ bias is the tendency to interpret new information to confirm our existing beliefs.
Confirmation
True or False: The special case syndrome leads people to believe their situation is unique despite historical evidence to the contrary.
True
What is an example of confirmation bias in decision-making?
If you want to buy a house, you might highlight its positive aspects and downplay negatives like a long commute.
Why might someone overvalue their own business idea?
Due to ‘Not-invented-here syndrome,’ where people perceive their own ideas as superior.
According to survivorship bias, what should you remember when trying to emulate someone’s success?
Many unsuccessful attempts remain unseen; we only see the survivors, which skews our perception of success likelihood.
True or False: Selection factor neglect assumes that anyone, regardless of inherent traits, can succeed in specialized fields with enough hard work.
True
Explain outcome bias in the context of success.
Outcome bias involves judging decisions based solely on the outcome, overlooking factors like luck that may have contributed to success.
What is the risk of groupthink in decision-making?
A persuasive individual in a group can lead everyone to align on a potentially irrational conclusion due to social pressure.
What is one way to avoid cognitive biases when evaluating new information?
Rely on a large sample size and long trial periods for more accurate insights.
Fill in the blank: It’s advisable to research _________ and learn from people who have failed before making big decisions.
average success rates (or base rates)
What is a recommended strategy to prevent overcommitment to a failing plan?
Set a predetermined stopping point and write an exit plan in case the forecast is wrong.
