August 17, 2023 Personal Wealth Episode 266: Prof. Cass Sunstein: Practical Reason in Ordinary Life Cass R. Sunstein is currently the Robert Walmsley University Professor at Harvard. He is the founder and director of the Program on Behavioral Economics and Public Policy at Harvard Law School. In 2018, he received the Holberg Prize from the government of Norway, sometimes described as the equivalent of the Nobel Prize for law and the humanities. In 2020, the World Health Organization appointed him as Chair of its technical advisory group on Behavioural Insights and Sciences for Health. From 2009 to 2012, he was Administrator of the White House Office of Information and Regulatory Affairs, and after that, he served on the President’s Review Board on Intelligence and Communications Technologies and on the Pentagon’s Defense Innovation Board. Mr. Sunstein has testified before congressional committees on many subjects, and he has advised officials at the United Nations, the European Commission, the World Bank, and many nations on issues of law and public policy. He serves as an adviser to the Behavioural Insights Team in the United Kingdom. Mr. Sunstein is author of hundreds of articles and dozens of books, including Nudge: Improving Decisions about Health, Wealth, and Happiness (with Richard H. Thaler, 2008), Simpler: The Future of Government (2013), The Ethics of Influence (2015), #Republic (2017), Impeachment: A Citizen’s Guide (2017), The Cost-Benefit Revolution (2018), On Freedom (2019), Conformity (2019), How Change Happens (2019), and Too Much Information (2020). He is now working on a variety of projects involving the regulatory state, “sludge” (defined to include paperwork and similar burdens), fake news, and freedom of speech. We make countless decisions throughout our lives that range from the mundane to the monumental. But how do you decide how you decide? That is the fundamental question in our esteemed guest, Cass R. Sunstein’s new book Decisions about Decisions: Practical Reason in Ordinary Life. Cass currently serves as the Robert Walmsley University Professor at Harvard University and is the founder and director of the Program on Behavioral Economics and Public Policy at Harvard Law School. He is also a prolific author, with one of his most notable works being the hugely popular and impactful book, Nudge: Improving Decisions about Health, Wealth, and Happiness, which he co-wrote with Richard Thaler in 2008. In today’s conversation, we sit down with Prof. Sunstein to discuss the difficulties inherent to understanding why people make the decisions they make and what the latest research teaches us about how we should approach decision-making to maximize our well-being. Cass provides insight into second-order thinking strategies, the difference between picking and choosing, and why delegating a particular decision is sometimes the right call. We also unpack what to consider when making major life choices, the strengths and weaknesses of algorithms when it comes to decision-making, and much more. To hear Cass’s many insights on the topic of behaviour, knowledge, and decision-making, be sure to tune in! Key Points From This Episode: The challenges of understanding why people make the decisions that they make. (0:03:38) Second-order decisions and why they are sometimes preferable to on-the-spot decisions. (0:04:50) An overview of various second-order decision strategies. (0:06:45) Guidelines to help you choose which decisions to delegate and how to determine whether you have a trustworthy delegate. (0:11:28) What to consider when making a transformative and irrevocable life decision. (0:16:07) Why people avoid seeking out information that might make them feel bad, even if it could help them make better decisions. (0:21:29) How people decide what information to believe and when to update their beliefs. (0:28:01) Asymmetries in how we update our beliefs and factors that can deter people from updating their beliefs when faced with new evidence. (0:32:28) How joint evaluation and separate evaluation influences your decision making and which one you should use depending on the context. (0:43:12) Insights on well-being and what to value when you’re making everyday decisions. (0:48:14) The strengths and weaknesses of algorithms when it comes to making decisions and what we gain when we make decisions ourselves. (0:52:38) Examples of when using algorithms can be harmful or dangerous. (0:59:25) How our decisions can be manipulated and the importance of doing due diligence. (01:01:30) Cass’s well-known work on nudges and how nudges differ from manipulation. (01:02:59) Happiness, meaning, variety, and how Cass defines success in life. (1:05:50) Participate in our Community Discussion about this Episode: https://community.rationalreminder.ca/t/episode-266-prof-cass-sunstein-practical-reason-in-ordinary-life-discussion-thread/24797 Books From Today’s Episode: Decisions About Decisions: Practical Reason in Ordinary Life — https://amzn.to/3OTi2Un Nudge: Improving Decisions about Health, Wealth, and Happiness — https://amzn.to/3YwcEtz Links From Today’s Episode: Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582.Rational Reminder Website — https://rationalreminder.ca/ Shop Merch — https://shop.rationalreminder.ca/ Join the Community — https://community.rationalreminder.ca/ Follow us on X — https://twitter.com/RationalRemind Follow us on Instagram — @rationalreminder Benjamin on X — https://twitter.com/benjaminwfelix Cameron on X — https://twitter.com/CameronPassmore Cass R. Sunstein on on X — https://twitter.com/CassSunstein/ Cass R. Sunstein — https://hls.harvard.edu/faculty/cass-r-sunstein/ Share: Facebook Twitter LinkedIn Email CIRO Advisor Report
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