More and more evidence comes to the surface that many of our most important decisions such as which partner to marry, how to invest money etc. are not taken by the conscious (rational) brain, but by the unconscious brain, also referred to as gut feelings. These unconscious decisions are mostly much better than the conscious, rational decisions and I was curious how the unconscious brain would be able to achieve such a feat. The author is professor at a Max Planck institute, one of the most prestigious institutions in Germany and studies just that. He starts with an example how to catch a base ball. The rational approach would be to look at the trajectory and calculate where the ball will land. However, this is a complicated calculation and involves factors like wind speed and smoothness of the surface of the ball. In practise, good players don't do this, but unconsciously move such that they keep the ball at constant angle with respect to the horizon. No complicated calculations are involved and the success rate of catching is much higher. Many decisions depend on what will happen in the future: what will stock prices or housing prices do, which soccer team will win the competition? Usually very little data points are present and statistical methods are not very predictive. It turns out that our unconsious brain has some very simple rules of thumb, which are as good or even better as complicated statistical methods. In a competition by a major financial magazine, by just asking 100 people on the street which companies they knew, the author got a much better stock portfolio than the chief editor of the journal, who knew all the ins and outs of the companies involved. So buying what you know is basically a good strategy and almost all people follow this. Of course, there is a danger to at, as the author argues, this is exactly what commercials are aimed at, their main purpose is to make the product known, not to tell how good the product is.
In simple words, the book clearly explains what kind of tactics the unconscious brain uses to achieve its remarkable success. I found the book very interesting and have finished it in a few days. The only (small) disappointment I had was that it concentrates more on practical things like how to select the best stocks, how to predict the outcome of a future soccer match and less on psychological things such as: why do we like or dislike someone, how do we decide who to trust etc. I guess that the research of prof. Gerd Gigerenzer concentrates more on the first aspect and since it is not a very thick book, one cannot cover everything in depth.