More Mean Less

Today when you check out from window you see rain and you can feel that cold weather is getting closer. I was getting cold so I decided to make a tea. I like tea so I decided to go to cupboard and take one.

When I opened cupboard I have seen big selection of teas. I took my favorite apple and cinnamon but next to it was some other passion fruit, next was some green, black, wellness...

After while I was so confused that I end up with no tea at all. Is not it funny? I had such a taste at beginning but when I was facing so big option it made me feel confused regarding of my choice. What has happened?

I decided to browse web a little bit. I typed tea/ caj into google and pressed search. It was not good idea. Option which popped out I would say it was huge, I mean selection, I almost got headache. It was complicated to orient on web page. I do not recommend :)   

"I was thinking what they communicate to me" 

I understand that we want to feel freedom of choice however I did not feel good at all. "I believe that instead of offering huge variation of teas (or other product) they should focus to be more authentic, be more open, trying to talk to us, engage us. They should give us feeling that we are part of something."

Next time when you will be facing huge option, just think about what they want you to say. Do they want you to feel good, inspired or do they just want you to buy and they do not care about you...

Are You Rational Or Irrational?

Nowadays, in the world of perfect information, globalization and low transaction costs, we always try to maximize result. What do you think so? Let s say you get a hint for some horse race, you bet and you win. If there would be way that you can get again hint, you would like to get it, wouldn’t you? I would, that is why we are driven by maximizing results.

I have read in book Drive by Daniel Pink, that winner of Nobel prize Kahneman agreed that economics is study of human economic behavior. However we believe that we had placed too much emphasis on the economics and not enough on the human. I agree since all we learn are just theories, numbers, figures, graphs but nothing about human behavior.

There is a test: Imagine I can give you $10 and you decide whether you want share some, none or all based upon my instructions. So let s begin. If I offered you $6 (which means $4 you would have to give away), you would accept it? If I offered you $5 (you would have to give away $5), you would take it too, right? But what if I offered you just $2 from $10 (you would have to give away $8), would you take it? I wouldn’t, I have to admit. So let me know if you would take it or you wouldn’t.

Experiment says that the most people rejected. But think about it for while. If you took offer, you would have 2 usd more. If you reject, you get nothing. Cognitive mind know $2 is more than $0 but because we are human beings, our desire to have more, desire to win overrides it. That is why human behavior in economics is more important than just economics.

So If I can sum it up. It means

 "we are irrational even we think we are rational." 

So you might thinking I am rational, but are you? Sometimes just let it go with flow because you will not find rational decision anyway. Let me know what you think about.