Psychologist Gerd Gigerenzer argues that much of our behaviour is based on deceptively sophisticated rules-of-thumb, or “heuristics”. A robot programmed to chase and catch a ball would need to compute a series of complex differential equations to track the ball’s trajectory. But baseball players do so by instinctively following simple rules: run in the right general direction, and adjust your speed to keep a constant angle between eye and ball.
To make good decisions in a complex world, Gigerenzer says, you have to be skilled at ignoring information. He found that a portfolio of stocks picked by people he interviewed in the street did better than those chosen by experts. The pedestrians were using the “recognition heuristic”: they picked companies they’d heard of, which was a better guide to future success than any analysis of price-earning ratios.
Ian Leslie writing in The Economist