Julia Dhar

We want something about the story we are telling ourselves or the analysts or the market are telling us about it to be true.

We want it to be true.

And that will guide our view, our outlook on the company over the long term.

Sometimes that story will overwhelm what we see or observe in the data.

So the number one

In life, feelings and facts are both very important, but a feeling is not a fact.

Behavioral science focuses on basically why do people do what they do and what are effective strategies and tactics for changing behavior in predictable directions.

That could be my own behavior.

How do I adopt new habits?

It could be the behavior of a group, for example.

How do we get consistently better quality decisions, for example, from an investment team or from a fund manager?

It could be all the way at a whole of society level, how do we get better cooperation in our communities and that kind of thing.

One of the reasons why this combined body of psychology, economics, neuroscience, marketing is so important is human beings sometimes find it difficult to do all of the things that we hoped to do, that all the things that would make us

the best version of ourselves, we find it hard to follow through on the things that we committed to do or that we want to do.

And the other reason, especially for economists, that this whole body of research is so interesting, is so important, is that for a long time, we assumed, that is, economists assumed, that human beings were rational creatures.

utility maximizing, it would say we're able to take in all of the information that was presented to us and make a really good quality decision as a result.

That's the whole basis of rational market economics.

And that turns out not to be true and is now very well established not to be a comprehensive explanation of human behavior.

And the thing that I love is an awful lot of what we talk about as behavioral biases actually reveal really delightful things about human beings.

They show that we are much more generous, patient, kinder, altruistic than rationality would expect.