The Paradox of Choice: Why More is Less - by Barry Schwartz
Date read: 2023-06-23How strongly I recommend it: 9/10
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Detailed examples of how too much choice can be harmful with making better decisions. The author also showcases two types of people: Maximizers vs. Satisfiers and how too much choice can impact both types.
Contents:
My Notes
When people have no choice, life is almost unbearable. As the number of available choices increases, as it has in our consumer culture, the autonomy, control, and liberation this variety brings are powerful and positive. But as the number of choices keeps growing, negative aspects of having a multitude of options begin to appear. As the number of choices grows further, the negatives escalate until we become overloaded.
I believe that we make the most of our freedoms by learning to make good choices about the things that matter, while at the same time unburdening ourselves from too much concern about the things that don’t.
A large array of options may discourage consumers because it forces an increase in the effort that goes into making a decision. So consumers decide not to decide, and don’t buy the product. Or if they do, the effort that the decision requires detracts from the enjoyment derived from the results. Also, a large array of options may diminish the attractiveness of what people actually choose, the reason being that thinking about the attractions of some of the unchosen options detracts from the pleasure derived from the chosen one.
According to a survey conducted by Yankelovich Partners, a majority of people want more control over the details of their lives, but a majority of people also want to simplify their lives. There you have it—the paradox of our times.
Nobel Prize–winning psychologist Daniel Kahneman and his colleagues have shown that what we remember about the pleasurable quality of our past experiences is almost entirely determined by two things: how the experiences felt when they were at their peak (best or worst), and how they felt when they ended.
So it seems that neither our predictions about how we will feel after an experience nor our memories of how we did feel during the experience are very accurate reflections of how we actually do feel while the experience is occurring. And yet it is memories of the past and expectations for the future that govern our choices.
The availability heuristic says that we assume that the more available some piece of information is to memory, the more frequently we must have encountered it in the past. This heuristic is partly true. In general, the frequency of experience does affect its availability to memory. But frequency of experience is not the only thing that affects availability to memory. Salience or vividness matters as well.
It seems to be a fairly general principle that when making choices among alternatives that involve a certain amount of risk or uncertainty, we prefer a small, sure gain to a larger, uncertain one. Most of us, for example, will choose a sure $100 over a coin flip (a fifty-fifty chance) that determines whether we win $200 or nothing. When the possibilities involve losses, however, we will risk a large loss to avoid a smaller one. For example, we will choose a coin flip that determines whether we lose $200 or nothing over a sure loss of $100.
Some studies have estimated that losses have more than twice the psychological impact as equivalent gains. The fact is, we all hate to lose, which Kahneman and Tversky refer to as loss aversion.
The endowment effect helps explain why companies can afford to offer money-back guarantees on their products. Once people own them, the products are worth more to their owners than the mere cash value, because giving up the products would entail a loss.
Thus the growth of options and opportunities for choice has three, related, unfortunate effects. It means that decisions require more effort. It makes mistakes more likely. It makes the psychological consequences of mistakes more severe.
A chooser is someone who thinks actively about the possibilities before making a decision. A chooser reflects on what’s important to him or her in life, what’s important about this particular decision, and what the short-and long-range consequences of the decision may be. A chooser makes decisions in a way that reflects awareness of what a given choice means about him or her as a person. Finally, a chooser is thoughtful enough to conclude that perhaps none of the available alternatives are satisfactory, and that if he or she wants the right alternative, he or she may have to create it.
A picker does none of these things. With a world of choices rushing by like a music video, all a picker can do is grab this or that and hope for the best. Obviously, this is not such a big deal when what’s being picked is breakfast cereals. But decisions don’t always come at us with signs indicating their relative importance prominently attached. Unfortunately, the proliferation of choice in our lives robs us of the opportunity to decide for ourselves just how important any given decision is.
CHOOSING WISELY BEGINS WITH DEVELOPING A CLEAR UNDERSTANDING of your goals. And the first choice you must make is between the goal of choosing the absolute best and the goal of choosing something that is good enough. If you seek and accept only the best, you are a maximizer.
The alternative to maximizing is to be a satisficer. To satisfice is to settle for something that is good enough and not worry about the possibility that there might be something better. A satisficer has criteria and standards. She searches until she finds an item that meets those standards, and at that point, she stops.
I believe that the goal of maximizing is a source of great dissatisfaction, that it can make people miserable—especially in a world that insists on providing an overwhelming number of choices, both trivial and not so trivial.
People with high maximization scores experienced less satisfaction with life, were less happy, were less optimistic, and were more depressed than people with low maximization scores.
While maximizers and perfectionists both have very high standards, I think that perfectionists have very high standards that they don’t expect to meet, whereas maximizers have very high standards that they do expect to meet.
The truth is that maximizing and satisficing orientations tend to be “domain specific.” Nobody is a maximizer in every decision, and probably everybody is in some. Perhaps what distinguishes maximizers from satisficers is the range and number of decisions in which an individual operates as one or the other.
But if money doesn’t do it for people, what does? What seems to be the most important factor in providing happiness is close social relations. People who are married, who have good friends, and who are close to their families are happier than those who are not. People who participate in religious communities are happier than those who do not. Being connected to others seems to be much more important to subjective well-being than being rich.
What seems likely to me is that the causality works both ways: happy people attract others to them, and being with others makes people happy.
Be diliberate with how you spend your time and what you spend it on. Minor choices can take time away from what you care about the most. Time spent dealing with choice is time taken away from being a good friend, a good spouse, a good parent, and a good congregant.
Even decisions that appear to be no-brainers carry the hidden costs of the options declined. Thinking about opportunity costs may not change the decision you make, but it will give you a more realistic assessment of the full implications of that decision.
Difficult trade-offs make it difficult to justify decisions, so decisions are deferred; easy trade-offs make it easy to justify decisions. And single options lie somewhere in the middle.
The options we consider usually suffer from comparison with other options.
“What happens when you have too many options is that you are responsible for what happens to you.”
One of the reasons that maximizers are less happy, less satisfied with their lives, and more depressed than satisficers is precisely because the taint of trade-offs and opportunity costs washes out much that should be satisfying about the decisions they make.
Most of us seem to share the intuition that we regret actions that don’t turn out well more than we regret failures to take actions that would have turned out well. This is sometimes referred to as an omission bias, a bias to downplay omissions (failures to act) when we evaluate the consequences of our decisions.
The omission bias undergoes a reversal with respect to decisions made in the more distant past. When asked about what they regret most in the last six months, people tend to identify actions that didn’t meet expectations. But when asked about what they regret most when they look back on their lives as a whole, people tend to identify failures to act.
If we are responsible for an action that turns out badly and if it almost turned out well, then we are prime candidates for regret. What is important about this picture is that the more that our experiences result from our own choices, the more regret we will feel if things don’t turn out as we had hoped. So although adding options may make it easier for us to choose something we really like, it will also make it easier for us to regret choices that don’t live up to our hopes or expectations.
It is maximizers who make a really big investment in each of their decisions, who agonize most about trade-offs. And so it is maximizers who will be most disappointed when they discover the pleasure they derive from their decisions to be short-lived.
High expectations can be counterproductive. We probably can do more to affect the quality of our lives by controlling our expectations than we can by doing virtually anything else. The blessing of modest expectations is that they leave room for many experiences to be a pleasant surprise, a hedonic plus.
One way of achieving this goal is by keeping wonderful experiences rare. No matter what you can afford, save great wine for special occasions.
Happy people have the ability to distract themselves and move on, whereas unhappy people get stuck ruminating and make themselves more and more miserable.
Try the following: Review some recent decisions that you’ve made, both small and large (a clothing purchase, a new kitchen appliance, a vacation destination, a retirement pension allocation, a medical procedure, a job or relationship change). Itemize the steps, time, research, and anxiety that went into making those decisions. Remind yourself how it felt to do that work. Ask yourself how much your final decision benefited from that work.
There are some strategies you can use to help you avoid the disappointment that comes from thinking about opportunity costs: Unless you’re truly dissatisfied, stick with what you always buy. Don’t be tempted by “new and improved.” Don’t “scratch” unless there’s an “itch.” And don’t worry that if you do this, you’ll miss out on all the new things the world has to offer.
Society provides rules, standards, and norms for making choices, and individual experience creates habits. By deciding to follow a rule (for example, always wear a seat belt; never drink more than two glasses of wine in one evening), we avoid having to make a deliberate decision again and again. This kind of rule-following frees up time and attention that can be devoted to thinking about choices and decisions to which rules don’t apply.