Alternative economics. Protection or common lie? — our tricky brain

Have you ever thought about what have made you the way you are now? The discussions on this topic don’t die off through centuries. But now I don’t want to get deep on different evolution and philosophy theories. What I want to emphasize on is that the thing that makes us unique is nothing else that the way, in which we perceive the world. You probably have never thought about it, but that’s the way it is. There is no another person in the whole universe who have the same beliefs and views, concerning each detail as you have. This leaves us with quite courageous statement that we are who we are, thanks to our perception of the existing world. Okay, let it be, you may think, but what does it implies?

It actually means that we (or our brain for us) will do everything in our power in order to preserve the way in which we perceive the world — our own reality. Why? That’s an easy question. This is the way the basic human instinct works and don’t think about the one described in the movie with Michael Douglas and Sharon Stone. The main human instinct is instinct of surviving. It means, in the most general sense, to live through any circumstances, despite everything. The mechanism of this instinct works the funny way actually. Our brain does everything in his power to keep us in our reality, in order to be safe from outside influences even when our perception may be wrong. That life-saving brain function is usually called a cognitive bias.

Let’s go a bit deeper to understand better this phenomenon. The protection mechanism of our brain tries to preserve our perceptions of the world untouched. Thus it either finds a continuous confirmation of the trueness of perceptions or rejects everything that can change them. Brain can even combine these two ways of our reality protection. All people’s brains have this self-protecting function, thus the ways in which the brain deceives its owners is the same or very similar on average. Therefore, we can distinguish some general cognitive biases, which are nothing more than the usual deviations, caused by people’s perceptions, from the generally accepted perception of the world. So, actually we can say that the person, whose perceptions coincide with the general one, will have no cognitive biases as its brain won’t use its protection function.

Generally, cognitive biases have a negative aspect, especially in economic context. From what we have seen before such thing is a bit confusing and that’s completely normal. So which arguments the economists give in order to support this statement? First of all, the cognitive bias overshadows our clear mind and pushes us towards making irrational decisions. Is it a disaster? I wouldn’t say so. People in their nature are irrational creatures and the basis of emotions is irrational as well. So we may say that everything that makes us humans is more or less irrational and that rationality isn’t the perfection state that everyone wants to achieve. However, this argument that we have seen before, may lead to some kind of manipulation from the people, who are well-aware of this biases and want to use them for their own sake. That’s what people of marketing are usually doing, helping us be happy for “our own purchasing decisions”.

It is quite a different approach of understanding and using the cognitive bias phenomenon. Nevertheless, it has some seeds of trueness in itself, as it states that by deceiving ourselves for our own sake our brain may help other people deceive us for their own sake. That’s an important thing that we have to remember when we kind of allow our brain execute its protection function. I dare to say “allow” as from my point of view we still give orders to our brain on conscious level so in most cases we understand or at least tend to understand that this is only a deception. If not we should make some efforts to improve this situation by learning more on this topic. Thus, we can use the cognitive bias for our own good, accepting it if it can help us achieve something or live a better life, but rejecting it by clearing our minds if it may have a negative impact on us.