Simply Rational: Decision Making in the Real World (2015)

Product Description: Statistical illiteracy can have an enormously negative impact on decision making. This volume of collected papers brings together applied and theoretical research on risks and decision making across the fields of medicine, psychology, and economics. Collectively, the essays demonstrate why the frame in which statistics are communicated is essential for broader understanding and sound decision making, and that understanding risks and uncertainty has wide-reaching implications for daily life. Gerd Gigerenzer provides a lucid review and catalog of concrete instances of heuristics, or rules of thumb, that people and animals rely on to make decisions.  

Table of Contents: 1) How I Got Started Teaching Physicians and Judges Risk Literacy Part I: The Art of Risk Communication. 2) Why Do Single-Even Probabilities Confuse Patients? 3) HIV Screening: Helping Clinicians Make Sense of Test Results to Patients. 4) Breast Cancer Screening Phamplets Mislead Women.      Part II. Health Statistics 5) Helping Doctors and Patients Make Sense of Health Statistics. 6) Public Knowledge of Benefits of Breast and Prostate cancer Screening in Europe.     Part III. Smart Heuristics. 7) Heuristic Decision Making. 8) The Recognition Heuristic: A Decade of Research.     Part IV: Intuitions about Sports and Gender. 9) The Hot Hand Exists in Volleyball is Is Used for Allocation Decisions. 10) Stereotypes about Men's and Women's Intuitions: A Study of Two Nations. Part V. Theory. 11) As-if Behavioral Economics: Neoclassical Economics in Disguise? 12) Personal Reflections on Theory and Psychology.

Excerpts:  Few pupils learn to see a connection between statistics in school and what is going on in their world. Why do schools contribute so little to statistical literacy? We believe their are four factors. Statistical thinking is taught (a) too late in school, (b) with representations that confuse young minds, (c) with boring examples that kill motivation and (d) by teachers who are unversed in statistical thinking. Statistical literacy should be taught as early as reading and writing. An essential requirement for starting early is a discrete (not continuous) concept of probability. Children can easily understand natural numbers, whereas proportions and continuous quantities are more difficult (Butterworth, 1999; Gelman & Gallistel, 1978). Yet many mathematics educators insist that probability needs to be introduced as a continuous variable along with continuous distributions. This theoretical vision is a major obstacle to a successful head start with statistical thinking.

For instance, at a conference on teaching statistics in school, where we showed that children can easily understand statistics with discrete representations (such as the absolute number of cases, as in Figs. 5.3 and 5.8), a mathematics professor asked why the frequentistic, discrete concept of probability was being emphasized, as opposed to the subjective, continuous concept (according to which a continuous probability distribution describes a person's degree of belief in a proposition, such as that the next president of the United States will be Republican; see Savage, 1972). He seems to have been thinking about philosophical schools of probability, not about children. <snip> Statistical literacy is more than learning the laws of statistics; it is about representations that the human mind can understand and remember.

Risk Savvy: How to Make Good Decisions (2015)

Table of Contents: Part I: The Psychology of Risk. 1) Are People Stupid? 2) Certainty is an Illusion. 3) Defensive Decision Making. 4) Why Do We Fear What is Unlikely to Kill Us?  Part II: Getting Risk Savvy. 5) Mind Your Money. 6) Leadership and Intuition. 7) Fun and Games. 8) Getting to the Heart of Romance. 9) What Doctors Need to Know. 10) Health Care: No Decision About Me Without Me. 11) Banks, Cows and Other Dangerous Things.  Part III. Start Early. 12) Revolutionize School.

Numbers may not lie, but they are certainly often misunderstood, according to German psychologist and risk analyst Gigerenzer. We make poor decisions on an array of issues, from health-care screenings to investment decisions to planned outings, because we blindly rely on data that may be incorrectly interpreted and reported. Gigerenzer draws on psychology, sociology, and math to explain how data can start off clear and end up murky by the time it reaches its intended audience, leaving us helpless to make sound decisions about the risks involved. He notes that the risk of cancer is often misinterpreted and can lead to overzealous screenings and that Americans irrationally refused to fly after the 9/11 terrorist attacks even though the risk of being killed in an auto accident is much greater. Gigerenzer cautions readers to always look for a reference point when data is quoted and to understand the difference between relative and absolute risk. This is a highly accessible look at the importance of data and the equally great importance of clearly understanding data. --Vanessa Bush

Rationality for Mortals: How People Cope with Uncertainty (Evolution and Cognition) (5.2008)

Product Description: Gerd Gigerenzer's influential work examines the rationality of individuals not from the perspective of logic or probability, but from the point of view of adaptation to the real world of human behavior and interaction with the environment. Seen from this perspective, human behavior is more rational than it might otherwise appear. This work is extremely influential and has spawned an entire research program. This volume (which follows on a previous collection, Adaptive Thinking, also published by OUP) collects his most recent articles, looking at how people use "fast and frugal heuristics" to calculate probability and risk and make decisions. It includes a newly written, substantial introduction, and the articles have been revised and updated where appropriate. This volume should appeal, like the earlier volumes, to a broad mixture of cognitive psychologists, philosophers, economists, and others who study decision making.

Gut Feelings: The Intelligence of the Unconscious

by Gerd Gigerenzer (2007, 288 pgs, hc $52).  Gut Feelings: The Intelligence of the Unconscious is "a fascinating analysis of how human beings make choices and judgments based on instincts.  Explains where gut feelings come from and the role they play in our decisions ... from business investments to choosing a mate. plenty of anecdotes that keep it interesting and relevant."

Editorial Reviews From Publishers Weekly: Gigerenzer's theories about the usefulness of mental shortcuts were a small but crucial element of Malcolm Gladwell's bestseller Blink, and that attention has provided the psychologist, who is the director of the Max Planck Institute for Human Development in Berlin, the opportunity to recast his academic research for a general audience. The key concept—rules of thumb serve us as effectively as complex analytic processes, if not more so—is simple to grasp. Gigerenzer draws on his own research as well as that of other psychologists to show how even experts rely on intuition to shape their judgment, going so far as to ignore available data in order to make snap decisions. Sometimes, the solution to a complex problem can be boiled down to one easily recognized factor, he says, and the author uses case studies to show that the Take the Best approach often works. Gladwell has in turn influenced Gigerenzer's approach, including the use of catchy phrases like the zero-choice dinner and the fast and frugal tree, and though this isn't quite as snappy as Blink, well, what is? Closing chapters on moral intuition and social instincts stretch the central argument a bit thin, but like the rest will be easily absorbed by readers. Illus. (July 9)

 Heuristics and the Law (2006)

Review:  "An excellent collection, and an important contribution to exciting new work at the intersection of psychology, economics, and law. Highly recommended for everyone interested in knowing how people really behave--and in understanding how actual behavior affects the law."   --  Cass R. Sunstein, Law School and Department of Political Science, University of Chicago

"For legal academics and policy makers who think that the use of heuristics leads to suboptimal decision making and the possibility of exploitation, this book opens a window onto a more charitable view of heuristics: that they are fast and frugal decision-making techniques that may outperform statistical methods that purport to evaluate a fuller set of informational cues. It provides not just a conceptual overview of alternative understandings of heuristics but a number of interesting hypotheses about jurisprudence, rules of evidence and jury behavior, and barriers to implementation of formal legal commands."  -- Mark Kelman, William Nelson Cromwell Professor of Law and Vice Dean, Stanford Law School

Book Description: In recent decades, the economists' concept of rational choice has dominated legal reasoning. And yet, in practical terms, neither the lawbreakers the law addresses nor officers of the law behave as the hyperrational beings postulated by rational choice. Critics of rational choice and believers in "fast and frugal heuristics" propose another approach: using certain formulations or general principles (heuristics) to help navigate in an environment that is not a well-ordered setting with an occasional disturbance, as described in the language of rational choice, but instead is fundamentally uncertain or characterized by an unmanageable degree of complexity. This is the intuition behind behavioral law and economics. In Heuristics and the Law, experts in law, psychology, and economics explore the conceptual and practical power of the heuristics approach in law. They discuss legal theory; modeling and predicting the problems the law purports to solve; the process of making law, in the legislature or in the courtroom; the application of existing law in the courts, particularly regarding the law of evidence; and implementation of the law and the impact of law on behavior.

Contributors:  Ronald J. Allen, Hal R. Arkes, Peter Ayton, Susanne Baer, Martin Beckenkamp, Robert Cooter, Leda Cosmides, Mandeep K. Dhami, Robert C. Ellickson, Christoph Engel, Richard A. Epstein, Wolfgang Fikentscher, Axel Flessner, Robert H. Frank, Bruno S. Frey, Gerd Gigerenzer, Paul W. Glimcher, Daniel G. Goldstein, Chris Guthrie, Jonathan Haidt, Reid Hastie, Ralph Hertwig, Eric J. Johnson, Jonathan J. Koehler, Russell Korobkin, Stephanie Kurzenhäuser, Douglas A. Kysar, Donald C. Langevoort, Richard Lempert, Stefan Magen, Callia Piperides, Jeffrey J. Rachlinski, Clara Sattler de Sousa e Brito, Joachim Schulz, Victoria A. Shaffer, Indra Spiecker genannt Döhmann, John Tooby, Gerhard Wagner, Elke U. Weber, Bernd Wittenbrink

Reckoning with Risk: Learning to Live with Uncertainty (2003)

Product Description: At the beginning of the 20th century, the father of modern science fiction, H.G. Wells, predicted that statistical thinking would be as necessary for citizenship in a technological world as the ability to read and write. Yet, a century on, most of us, from television weather forecasters to the American President, seem to have no idea of how to reason about uncertainties. Accordingly, a number of books have marshalled a long roster of cognitive illusions as evidence of humans' fundamental irrationality. Detailing case histories and examples, this text presents readers with tools for understanding statistics. In so doing, it encourages us to overcome our innumeracy and empowers us to take responsibility for our own choices.

Review: "This is an important book, full of relevant examples and worrying case histories. By the end of it, the reader has been presented with a powerful set of tools for understanding statistics...anyone who wants to take responsibly for their own medical choices should read it" - New Scientist

Review: Most adults consider themselves numerate if they can perform the simple functions of addition, subtraction, multiplication and division. An understanding of the way numbers work is increasingly important as our lives become more and more informed by them; many of the everyday decisions we have to make involve the understanding of complex figures, the news we hear is backed up by statistics, we routinely talk of percentages and ratios in the most casual conversations. However, even those who think they're thoroughly au fait with these techniques can easily be fooled by the misleading presentation of figures, whether through deliberate misrepresentation by cynical politicians or advertisers, or insufficient lucidity on the part of news reporters, doctors, lawyers and other influential individuals. In this book, Gerd Gigerenzer attempts to illuminate this widespread misrepresentation and suggests clear paths of thought to be used when faced with 'incontrovertible' facts derived from spurious mathematics. Gigerenzer is not short of examples to illustrate his case. One, derived from the work of mathematician John Allen Paulos, concerns a TV weather forecaster reporting that there was a 50 percent chance of rain on a Saturday and a 50 percent chance of rain on the Sunday, and concluding that this meant that there was a 100 percent chance of rain that weekend. This kind of functional innumeracy is found again and again, from trivial examples such as the above to those involving crucially important situations such as AIDS testing and mammogram results. This is no mere whine about 'falling standards', but instead points up a general lack of perception in a central area of our lives which materially affects the way we make important decisions. And it's a good read as well; the examples given are interesting stories in themselves and Gigerenzer is a lively narrator who moves smoothly from one chapter to another. Add to this a number of beguilingly simple methods towards clearer thinking and some fascinating sidelines on the nature of probability, and I reckon nine out of ten readers will say their cats enjoyed this book. Probably. (Kirkus UK)

Adaptive Thinking (2002)

Reviews (Amazon.com):  In Adaptive Thinking, Gerd Gigerenzer follows up on his earlier book, The Empire of Chance. Part of his new book, Adaptive Thinking, is a continuation of his earlier discussion. Gigerenzer reacts against the dominance of significance testing, and looks closely at how it has shaped psychological theories. In particular, Gigerenzer places the "cognitive illusions" of Tversky, Khanneman, and many other behavioral scientists under very close scrutiny.

Gigerenzer's main thrust is that humans did not evolve in the psychology laboratory, with good command of probability theory to help them work on word problems. Instead, he argues, humans evolved in environments with lots of noise, and had to use regular features of the world to develop simple and effective rules of action. In this, he echoes and extends the work by economist Herbert Simon in the 1950s.

Take one of his examples: You live in Detroit. 1 in 100 new cars of brand X break down. 10 in 100 cars of brand Y break down. Your friend has car X, and it just broke down yesterday. Which should you buy? Well, clearly if you're "rational" you buy brand X. But consider:

You live in a jungle. 1 in 100 children is eaten by a crocodile while swimming in the river. 10 in 100 falls to their death while playing in the tree. Just yesterday, little Bobby was swimming and got eaten by a crocodile. Where should you let your kid play?

According to Tversky, Khanneman, and other modern cognitive scientists, you would be "irrational" to fear the river, since the long term probability of dying there is still only 2 out of 100.

If we evolved in the jungle situation, is it any wonder that most people rely on the advice of their friend in the car situation? Does this make them "irrational?"

Gigerenzer looks at the history of decision research, and offers a concrete and predictive program for the study of human rationality. The book is fairly short, very interesting, and casts serious doubt on many aspects of contemporary cognitive research. I recommend it to anyone with an interest in psychology or decision making, even non professionals.

Reviewed in Human Nature Review, 2002 Volume 2: 548-550 ( 12 December ) by Lisa Bortolotti, Philosophy Program, ANU, Canberra Australia.

Bounded Rationality: The Adaptive Toolbox  (2001)

"Bounded Rationality constitutes a milestone in the development of a framework for understanding human cognition." -- Robert Kurzban, Contemporary Psychology

Book Description
In a complex and uncertain world, humans and animals make decisions under the constraints of limited knowledge, resources, and time. Yet models of rational decision making in economics, cognitive science, biology, and other fields largely ignore these real constraints and instead assume agents with perfect information and unlimited time. About forty years ago, Herbert Simon challenged this view with his notion of "bounded rationality." Today, bounded rationality has become a fashionable term used for disparate views of reasoning.

This book promotes bounded rationality as the key to understanding how real people make decisions. Using the concept of an "adaptive toolbox," a repertoire of fast and frugal rules for decision making under uncertainty, it attempts to impose more order and coherence on the idea of bounded rationality. The contributors view bounded rationality neither as optimization under constraints nor as the study of people?s reasoning fallacies. The strategies in the adaptive toolbox dispense with optimization and, for the most part, with calculations of probabilities and utilities. The book extends the concept of bounded rationality from cognitive tools to emotions; it analyzes social norms, imitation, and other cultural tools as rational strategies; and it shows how smart heuristics can exploit the structure of environments.

Simple Heuristics That Make Us Smart  (1999)

Review:  "In the past few years, the theory of rational (sensible) human behavior has broken loose from the illusory and empirically unsupported notion that deciding rationally means maximizing expected utility. Research has learned to take seriously and study empirically how real human beings ... actually address the vast complexities of the world they inhabit. Simple Heuristics ... offers a fascinating introduction to this revolution in cognitive science, striking a great blow for sanity in the approach to human rationality."--Herbert A. Simon, Carnegie Mellon University, and Nobel Laureate in Economics

TABLE OF CONTENTS

The ABC Research Group I. The Research Agenda 1. Gerd Gigerenzer and Peter M. Todd: Fast and Frugal Heuristics: The Adaptive Toolbox II. Ignorance-Based Decision Making  2. Daniel G. Goldstein and Gerd Gigerenzer: The Recognition Heuristic: How Ignorance Makes Us Smart 3. Bernhard Borges et al.: Can Ignorance Beat the Stock Market? III. One-Reason Decision Making 4. Gerd Gigerenzer and Daniel G. Goldstein: Betting on One Good Reason: The Take The Best Heuristic 5. Jean Czerlinski, Gerd Gigerenzer, and Daniel G. Goldstein: How Good Are Simple Heuristics? 6. Laura Martignon and Ulrich Hoffrage: Why Does One-Reason Decision Making Work? A Case Study in Ecological Rationality 7. Jorg Rieskamp and Ulrich Hoffrage: When Do People Use Simple Heuristics, and How Can We Tell? 8. Laura Martignon and Kathryn Blackmond Laskey: Bayesian Benchmarks for Fast and Frugal Heuristics IV. Beyond Choice: Memory, Estimation, and Categorization 9. Ulrich Hoffrage and Ralph Hertwig: Hindsight Bias: A Price Worth Paying for Fast and Frugal Memory 10. Ralph Hertwig, Ulrich Hoffrage, and Laura Martignon: Quick Estimation: Letting the Environment Do the Work 11. Patricia M. Berretty, Peter M. Todd, and Laura Martignon: Categorization by Elimination: Using Few Cues to Choose V. Social Intelligence 12. Philip W. Blythe, Peter M. Todd, and Geoffrey F. Miller: How Motion Reveals Intention: Categorizing Social Interactions 13. Peter M. Todd and Geoffrey F. Miller: From Pride and Prejudice to Persuasion: Satisficing in Mate Search 14. Jennifer Nerissa Davis and Peter M. Todd: Parental Investment by Simple Decision Rules VI. A Look Around, A Look Back, A Look Ahead 15. Adam S. Goodie et al.: Demons versus Heuristics in Artificial Intelligence, Behavioral Ecology, and Economis 16. Peter M. Todd and Gerd Gigerenzer: What We Have Learned (So Far) References Name Index Subject Index

Reviews (from Amazon website)

"How do people cope in the real, complex world of confusing and overwhelming information and rapidly approaching deadlines? This important book starts a new quest for answers. Here, Gigerenzer, Todd, and their lively research group show that simple heuristics are powerful tools that do surprisingly well. The field of decision making will never be the same again."--Donald A. Norman, author of Things That Make Us Smart and The Invisible Computer

"Gigerenzer and Todd's volume represents a major advance in our understanding of human reasoning, with many genuinely new ideas on how people think and an impressive body of data to back them up. Simple Heuristics is indispensable for cognitive psychologists, economists, and anyone else interested in reason and rationality."--Steven Pinker, author of How the Mind Works and Words and Rules

"This book is a major contribution to the theory of bounded rationality. It illustrates that the surprising efficiency of fast and simple procedures is due to their fit with the structure of the environment in which they are used. The emphasis on this ecological rationality is an advance in a promising and already fruitful new direction of research."--Reinhard Selten, Professor of Economics at the University of Bonn, and Nobel Laureate in Economics

"In recent years, and particularly in the culture wars, many people have written about rationality. These authors now provide a summary of this recent history, organized on the basis of different types of decision making. In each case, the authors summarize the literature so as to provide an implicit history. But the book is more fundamentally aimed at making rationality workable by showing 'the way that real people make the majority of their inferences and decisions.'"--Journal of the History of the Behavioral Sciences

"The underlying argument of the book is that the environments in which we evolved and in which we now live have certain regularities, and that decision making mechanisms - both evolved mechanisms, and the mechanisms that we actually use today - take advantage of these environmental regularities. Most of the book illustrates this argument by showing that in many circumstances shortcut decision making mechanisms (the 'simple heuristics' of the title) are remarkably accurate...This book by Gigerenzer and his associates marks a significant advance in the analysis." -- Paul H. Rubin, Journal of Bioeconomics, Vol 2, 2000

"The underlying argument of the book is that the environments in which we evolved and in which we now live have certain regularities, and that decision making mechanisms--both evolved mechanisms, and the mechanisms that we actually use today--take advantage of these environmental regularities. Most of the book illustrates this argument by showing that in many circumstances shortcut decision making mechanisms (the 'simple heuristics' of the title) are remarkably accurate...This book by Gigerenzer and his associates marks a significant advance in the analysis." -- Paul H. Rubin, Journal of Bioeconomics, Vol 2, 2000

"Gigerenzer et al. take on a heroic effort of creating a grand theory of mind ..."--Contemporary Psychology, APA Review of Books

Calculated Risks: How to Know When Numbers Deceive You (1986)

Amazon.com: In the tradition of Innumeracy by John Allen Paulos, German scientist Gerd Gigerenzer offers his own take on numerical illiteracy. "In Western countries, most children learn to read and write, but even in adulthood, many people do not know how to think with numbers," he writes. "I focus on the most important form of innumeracy in everyday life, statistical innumeracy--that is, the inability to reason about uncertainties and risk." The author wisely uses concrete examples from the real world to make his points, and he shows the devastating impact of this problem. In one example, he describes a surgeon who advised many of his patients to accept prophylactic mastectomies in order to dodge breast cancer. In a two-year period, this doctor convinced 90 "high-risk" women without cancer to sacrifice their breasts "in a heroic exchange for the certainty of saving their lives and protecting their loved ones from suffering and loss." But Gigerenzer shows that the vast majority of these women (84 of them, to be exact) would not have developed breast cancer at all. If the doctor or his patients had a better understanding of probabilities, they might have chosen a different course. Fans of Innumeracy will enjoy Calculated Risks, as will anyone who appreciates a good puzzle over numbers. --John Miller --This text refers to an out of print or unavailable edition of this title.

From Publishers Weekly
If a woman aged 40 to 50 has breast cancer, nine times out of 10 it will show up on a mammogram. On the other hand, nine out of 10 suspicious mammograms turn out not to be cancer. Confused? So are many people who seek certainty through numbers, says Gigerenzer, a statistician and behavioral scientist. His book is a successful attempt to help innumerates (those who don't understand statistics), offering case studies of people who desperately need to understand statistics, including those working in AIDS counseling, DNA fingerprinting and domestic violence cases. Gigerenzer deftly intersperses math lessons explaining concepts like frequency and risk in layperson's terms with real-life stories involving doctors and detectives. One of his main themes is that even well-meaning, statistically astute professionals may be unable to communicate concepts such as statistical risk to innumerates. (He tells the true story of a psychiatrist who prescribes Prozac to a patient and warns him about potential side effects, saying, You have a 30 to 50 percent chance of developing a sexual problem. The patient worries that in anywhere from 30% to 50% of all his sexual encounters, he is going to have performance problems. But what the doctor really meant is that for every 10 people who take Prozac, three to five may experience sexual side effects, and many have no sexual side effects at all.) All innumerates buyers, sellers, students, professors, doctors, patients, lawyers and their clients, politicians, voters, writers and readers have something to learn from Gigerenzer's quirky yet understandable book.
Copyright 2002 Cahners Business Information, Inc. --This text refers to an out of print or unavailable edition of this title.

Calculated risks: How to know when numbers deceive you. New York: Simon & Schuster.
(UK version: Reckoning with risk: Learning to live with uncertainty, London: Penguin).

The Empire of Chance (1989)
by Gerd Gigerenzer, Zeno Swijtink, Theodore Porter, Lorraine Daston, John Beatty, Lorenz Krüger

Review: "...will be useful to statisticians, philosophers, scientists and other historians of science who want to understand the roots of the probability-based statistical methods we use so widely today...The Empire of Chance is a valuable book." Science
"In contrast to the literature on the mathematical development of probablilty and statistics, this book focuses on how technical innovations remade our conceptions of nature, mind, and society. The work is aimed at historians of science and philosophers of science, but it is also directed toward scholars in other disciplines and therefore technical material is kept to a minimum." Journal of the History of the Behavioral Sciences

Book Description: This book tells how quantitative ideas of chance have transformed the natural and social sciences as well as everyday life over the past three centuries. A continuous narrative connects the earliest application of probability and statistics in gambling and insurance to the most recent forays into law, medicine, polling, and baseball. Separate chapters explore the theoretical and methodological impact on biology, physics, and psychology. In contrast to the literature on the mathematical development of probability and statistics, this book centers on how these technical innovations recreated our conceptions of nature, mind, and society