Why Don't We Choose What Makes Us Happy?

People are flawed. But it's rarely so well summarized as it is in the paper "Decision and Experience: Why Don't We Choose What Makes Us Happy?" (Hsee and Hastie 2006). The authors recap the many experiments in the literature of behavioral-decision theory that show that people don't choose outcomes that maximize their happiness, due to a number of failures in the human psychological makeup.

The vast popular literature on self-improvement is based on the belief that we aren’t getting everything we could out of life, and is replete with recipes to increase happiness. Recent findings from behavioral-decision research provide evidence that people are not always able to choose what yields the greatest happiness or best experience. People fail to choose optimally, either because they fail to predict accurately which option in the available choice set will generate the best experience or because they fail to base their choice on their prediction, or both.

They identify these biasing problems:

• Impact bias: We misjudge how severe an impact will be and hence choose the wrong option.
• Projection bias: We project from our current emotional or physical state how we will feel in the future. Hungry shopper buy more food than needed.
• Distinction bias: Joint-evaluation versus single-evaluation models screw us up. I pick from a selection of plasma TVs, but weigh attributes incorrectly because in my home I only experience one of them and the factors I weighed weren't relevant.
• Memory bias: We misremember peak events or significant events, and it influences future choice. (Subjects were lightly tortured with cold water for this one.) The bias disappears with gentle questioning though, good news for therapists.
• Belief bias: Lay theories about what will make us happy -- or, poor self-analysis. (People probably differ in this area.) This section really highlights how pathetic we are, though: "Another common belief is that more choice options are always better. In reality, having more options can lead to worse experiences [38–40]. For example, if employees are given a free trip to Paris, they are happy; if they are given a free trip to Hawaii, they are happy. But if they are given a choice between the two trips, they will be less happy, no matter which option they choose. Having the choice highlights the relative deficiencies in each option. People who choose Paris complain that 'Paris does not have the ocean', whereas people who choose Hawaii complain that 'Hawaii does not have great museums'."

Failures to follow decisions, another source for the failure of rational paths to happiness, are explained by:

• Impulsivity: We choose the short term immediate over the long-term outcome.
• Rule-based decisions: Related to aphorisms and cultural beliefs about "what's right," this is behavior based on rules like "don't waste" rather than rational predictions.
• Lay rationalism: Related to rules, this category represents the attempt to apply correct reasoning but getting it badly wrong. The 3 types covered here are "lay economism," "lay scientism," and "lay functionalism." "Another manifestation is ‘lay scientism’, a tendency to base choices on objective, 'hard' attributes rather than subjective, 'soft' attributes. For example, when choosing between two equally expensive audio systems, one with a higher wattage rating (a hard attribute) and the other with a richer sound (a soft attribute), most people chose the high-wattage model, even though when asked to predict their enjoyment, they favored the richer-sounding model. A third manifestation of lay rationalism is ‘lay functionalism’, a tendency to focus on the primary goal(s) of the decision and overlook other aspects that are important to overall experience."
• Medium maximization: People confuse the medium for happiness with the actual results, the most famous example being money. People work harder to get more money but more money itself doesn't increase happiness.

The implications for this type of research are politically worrying, of course (we assume in democratic and capitalist societies that people are capable of choosing what is best for them and should be allowed to do so). For software design and other economic problems, the implications are equally sad; if people can't be relied on to choose the products that are "best" by rational means, then the well-intentioned decisions of designers are that much less important and less related to final market success. Product usability itself is a "soft" factor subject to being sacrificed as unimportant, thanks to lay rationalism and the impact and distinction biases.