Not by a Long Shot: With Guests Katia Jordan & Craig Fox

Choiceology with Katy Milkman

Charles Schwab

Behavioral Economics, Society & Culture, Social Sciences, Decision Making, Charles Schwab, Business, Science, Investing, Dan Heath, Katy Milkman

4.8 • 1.4K Ratings

🗓️ 29 August 2022

⏱️ 34 minutes

🔗️ Recording | iTunes | RSS

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Summary

Humans can easily distinguish between a zero-chance event (e.g., the Washington Nationals winning the World Series in 2022) and a sure thing (e.g., the sun coming up tomorrow). But in between those two clear outcomes, it turns out that we’re not great at estimating odds. In this episode of Choiceology with Katy Milkman, a bias that affects the way we predict the likelihood of rare events.

Transcript

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0:00.0	There's someone somewhere out there could be the winner of the biggest jackpot ever.
0:12.5	$830 million is what one of these lucky players has a chance of winning.
0:18.1	Who doesn't want to be a millionaire?
0:19.9	That's why we're playing.
0:21.7	I came out here to win the billion dollar super lottery.
0:25.1	You have to be in it to win it, right?
0:26.6	Customers here tell us what they do with the jackpot money.
0:29.9	I'm going to keep traveling.
0:31.3	I'm going to travel the world.
0:32.4	I want to see every country.
0:34.3	If we were to win, first of all, I think all of us would go on vacation together.
0:38.8	I'm just going to be giving out money just letting it go.
0:42.3	Even though their chances of winning are one at $303 million.
0:50.6	Maybe you were someone you know buys lottery tickets and the hope of striking it rich.
0:55.2	And while it's relatively easy to demonstrate that the odds of winning a big prize are vanishingly small,
1:00.6	there's something in the way we think that leads us to believe those chances are better than they actually are.
1:06.5	In this episode, we look at a quirk in the way we tend to estimate the odds of rare events.
1:11.3	And I'll speak with UCLA Psychology Professor Craig Fox about the consequences of this bias.
1:25.9	I'm Dr. Katie Milkman and this is Choiceology, an original podcast from Charles Schwab.
1:31.5	It's a show about the psychology and economics behind our decisions.
1:35.3	We bring you true stories involving tough choices and then we explore how they relate to the latest research in behavioral science.
1:42.5	We do it all to help you make better judgments and avoid costly mistakes.
	...

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