When we go to a buffet, we don’t dump any random foods into our mouth like Pac-Man swallowing everything in front of him; we deliberately choose which dishes to eat and which to ignore. In the same way, there are always a lot of thoughts going through our mind and we need to select which ones to attend to and which ones to let go.

Chapter 6, Page 189

In a Nutshell

Why do we think we’re better prepared for job interviews than we are? Why is action on climate change so difficult? Why do we overthink when something bad happens to us?

In her popular Yale course, ‘Thinking’, renowned psychologist Professor Woo-kyoung Ahn helps students overcome the cognitive biases that cause people so many problems in their daily lives. In her new book Thinking 101, she takes the key principles she teaches in that course and shares them with the world.

Book Club Notes

Professor Woo-kyoung Ahn breaks down the book into lessons, filling them in with examples that bring them to life. It’s interesting, research based and relevant. You’ll learn why you think a certain way or why someone you know does – but more importantly you’ll walk away with the tools to think again, to transform your thinking and your life.

One of the lessons she shared that hit home to me was her explanation as to why so many of our homes are filled with clutter and why we find it so difficult to part with our things.  To explain this, she used the endowment effect and loss aversion.

The endowment effect is a phenomenon in behavioral economics whereby the owner of an item thinks that item is more valuable than the buyer does. On a very basic level this is because the owner wants to make as much money as possible while the buyer wants to pay as little as possible. The owner can also have a sentimental attachment which makes the item more valuable than it is. But there’s something else going on, and that she explains is loss aversion. The reason the endowment effect arises is because of the instinct we all have to avoid losing something that is ours – something we own. And she says it doesn’t matter how briefly we’ve had it. The endowment effect arises immediately, before you can form a sentimental attachment to an item.

The combination of the endowment effect and loss aversion are why we hold onto items we no longer have a use for. We don’t want to lose something we own and we hold onto the memories of where we got it, how much we paid or who gave it to us. I’ve stood in front of my own closet trying to do a clean out and find myself holding onto an item because of the memories I have of buying it and wearing it, never mind that I haven’t worn it in years and don’t plan on doing so.

The Genius of Marie Kondo

If we know why we hold on to clutter and items we no longer want, how do we think again to allow us to let go of that loss aversion?

We do a little Marie Kondo. No one, says Ahn understands loss aversion better than Marie Kondo. This is why the first thing she instructs you to do is to take everything out of your closet and dump it on your floor. When you do that it’s like you don’t own them anymore – the endowment effect falls away and there is nothing to lose. Your decisions are now reframed as deciding what to select. You switch from a loss mindset to a gain mindset as you now pick up each item and evaluate if you want to add it to your closet.

When Ahn Marie Kondo’d her closet she went even further by pretending she was purchasing each item from the pile. A mindset that made the decisions straight forward. You would never buy something that didn’t fit or that didn’t match your current style in the hope that maybe it would.

So next time you’re faced with decluttering make the decision making easier. Dump everything on the floor and “repurchase” items just as if you would when out shopping. You’re gaining items you actually want not losing items you know you’ll never use.

Read If

You want to understand why you make the decisions you do and how to rethink your life.

Rating

9
Readability – 10/10
Writing – 9/10
Applicability – 9/10
Timelessness – 9/10
Shareability – 8/10
9.0
9.0Overall Score
A note on our book ratings

Readability: How easy is it to read and understand what the author is saying? Do you need a dictionary or PhD to understand it?

Writing: How well written is the book? Do you find yourself wowed by the writing or unimpressed?

Applicability: How applicable is this book to daily life? Is there enough advice and actions that are easy to start applying?

Timelessness: Is the content of the book timeless or is it something that in a few years won’t have relevance?

Shareability: How likely are you to share the book?

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