How Do We Become Cognitive Misers?1

The 9/11 tragedy was terrible, and it certainly was vivid. The startling tragic events were presented again and again in the media. As a result some people stopped flying. Now if they simply stopped flying it would have been one matter; but they tended to drive instead. Now which is safer: flying or driving? Compared to almost any other activity in our lives, driving is the most dangerous. However, it is not vivid. We live and come to accept the carnage on the highways year in and year out. We drive and we do not see, from our personal perspective, than many accidents. Researchers estimated that 300 more people died in the remaining months of 2001 because they drove rather than flew. One group of researchers calculated that for driving to become as dangerous as flying an incident of the magnitude of the 9/11 tragedy would need to occur monthly!

Salience is another cue that can save effort, but lead us astray. Consider this question. Which is more dangerous?

A disease that killed 1286 out of 10,00 people

A disease that killed 24.14% of the people

Most thought that a disease that killed 1286 out of 10,00 people was the more dangerous. We can ask why. Well, 1286 is a large number of people, it is quite salient. One needs to do a computation, even though a rough mental calculation will indicate that 24.14% would be more than 2400 people out of 10,000. So the cost of this cognitive miserliness is the wrong answer.

Another example is the money illusion. This occurs when people are overly influenced by the nominal monetary value. It has been found that people underspend in a foreign currency when the foreign currency is a multiple of the home currency (for instance 1 US dollar = 4 Malaysian ringgits) and overspend in a foreign currency is a fraction of the home currency (say, 1 US dollar = .4 Bahraini dinar). This is something to keep foremost in your mind when you travel.

The money illusion can lead to serious public policy problems. In 2006 and 2007 there were calls for political action when gasoline prices reached $3 per gallon. However, when the price was adjusted for affordability (income) the price of gasoline was substantially below what it was from 1978 to 1981.

Key to memory health is its effective use. Miserly cognition is the enemy of rational decision making and cognitive health.

1Most of this content is based upon Stanovich, K. E. (2009). What Intelligence Tests Miss: the psychology of rational thought. New Haven: The Yale University Press.


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