Your car breaks down. Must be because you skipped an oil change last month. Or your favorite team loses. Well, that was because of a bad call by a corrupt referee. In reality, many events involve multiple contributing factors. But we tend to gravitate toward single causes.

In this episode of Choiceology with Katy Milkman, we look at our desire to explain things simply, even when the truth may be more complex.

Where unidentified flying objects are concerned, there is rarely a simple answer. They'd be identified flying objects otherwise. So in the absence of conclusive evidence, UFOs capture the imagination.

Case in point: the Rendlesham Forest Incident. We’ll hear from UFO expert (and skeptic) Toby Ball about a fascinating series of sightings in the Rendlesham Forest in the early 1980s. Toby deconstructs the events—and the rush to conclusions by certain media outlets—in search of an explanation.

Toby explores the folklore and culture surrounding UFO encounters on his show Strange Arrivals. He also appears on the weekly podcast Crime Writers On.

Next, Katy speaks with Tania Lombrozo about her research on our mind’s preference for simple explanations—and when that can lead us astray. Tania is the Arthur W. Marks Professor of Psychology at Princeton University and lab director at Princeton’s Concepts and Cognition Lab.

Choiceology is an original podcast from Charles Schwab. For more on the show, visit schwab.com/Choiceology.

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All expressions of opinion are subject to change without notice in reaction to shifting market conditions.

All names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting From Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

Apple, the Apple logo, iPad, iPhone, and Apple Podcasts are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.

Spotify and the Spotify logo are registered trademarks of Spotify AB.

0924-PU2Z

In this episode of Choiceology with Katy Milkman, we look at the often-misunderstood and surprisingly common Dunning-Kruger effect with an interview featuring one of the researchers who first identified it, David Dunning.

But we start with the story of Cecilia Jimenez, the humble Spanish grandmother and amateur landscape painter who took it upon herself to restore a fresco in her local church. The results made international headlines—and briefly made Ceclia Jimenez a household name—for all the wrong reasons.

Andrew Flack has a lot of compassion for Cecilia. He met with her several times in the process of writing an opera with composer Paul Fowler called Behold the Man about Ceclia’s ill-fated but ultimately beneficial project.

Next, David Dunning explains how—contrary to popular belief—we are all at the mercy of the Dunning-Kruger effect from time to time, and that we should be more humble in recognizing what we don’t know about what we don’t know.

David Dunning is the Ann and Charles R. Walgreen, Jr., Professor of the Study of Human Understanding at the University of Michigan. The paper "Unskilled and Unaware of It: How Difficulties in Recognizing One's Own Incompetence Lead to Inflated Self-Assessments," co-authored with Justin Kruger, led to the bias being named The Dunning-Kruger effect.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All expressions of opinion are subject to change without notice in reaction to shifting market conditions.

All names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting From Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

(0824-M9R6)

Pursuing a goal alone is convenient. Whether you're training for a marathon or aiming to read 20 books this year, it's convenient to move at your own pace and schedule. But having a gym buddy or a book club pal can make a bigger difference to your goal completion than you think.

In this episode of Choiceology with Katy Milkman, we look at the benefits of tandem goal pursuit in the context of training for a new Olympic sport: kite foiling.

Max Maeder is a 17-year-old kite foiling athlete and many-time world champion of the sport. Max is also a recent Olympic bronze medalist, having just represented Singapore at the 2024 Paris Games and winning the country's lone medal. To get to this point, Max has been working with the same training partner since 2021. And in this solo sport, working with a partner has made all the difference.

Next, Katy speaks with Rachel Gershon about their research on tandem goal pursuit and the many benefits of working toward goals with a partner. You can learn more in their working paper titled "Friends With Health Benefits: A Field Experiment."

Rachel Gershon is an assistant professor of marketing at the Haas School of Business at the University of California, Berkeley. Her research focuses on consumer judgments and choice with an emphasis on social, prosocial, and health-related behaviors.

Special thanks to Cam Farrar for use of his TikTok audio and the International Kiteboarding Association for use of their audio. You can find kite-foiling videos on the IKA's YouTube channel @kiteclasses.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting From Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

(0824-JKFS)

When you're facing loss—say, in a board game or during a sporting event or with a declining stock—it can be difficult to remember your true tolerance for risk. You're likely to seek risk more than you normally would.

In this episode of Choiceology with Katy Milkman, we look at a tendency to seek risk in the face of losses when those losses aren't yet finalized, but how chalking up those losses and moving on can actually help you recalibrate your appetite for risk.

During the American Revolutionary War, George Washington and his generals often adopted a strategy of retreating, or accepting losses on the battlefield, in order to regroup and live to fight another day. Their strategy was often successful against the British, who burned through men and equipment as they doubled down in their desire to win individual battles at the expense of their goal of regaining control of the American colonies.

Mary Stockwell is a historian, writer, and former history professor at Lourdes University in Ohio. Her work is focused on the American Revolution. Her recent book is titled Unlikely General: "Mad" Anthony Wayne and the Battle for America.

Next, Katy speaks with Alex Imas about his research on risk-taking over time and how mental choice bracketing impacts our decisions in the face of loss. You can learn more in Alex's paper titled "The Realization Effect: Risk-Taking after Realized Versus Paper Losses."

Alex Imas is a professor of behavioral science and economics at the University of Chicago Booth School of Business.

Choiceology is an original podcast from Charles Schwab.

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting from Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

(0624-4MRP)

Over the years, Choiceology has offered a lot of advice for making better decisions. In this special episode of Choiceology with Katy Milkman, we bring you the story of a video game that is surprisingly effective at reducing decision errors, and you'll hear about a practical checklist for improving choices in many different contexts.

Solving fictitious mysteries might sound like fun and games, but the video game MISSING: The Pursuit of Terry Hughes was designed with a serious purpose in mind: to help intelligence analysts avoid decision-making traps. In 2015, James Korris and Carey Morewedge worked together to design a video game for the intelligence agency IARPA, the Intelligence Advanced Research Projects Activity, and measured the biases exhibited before and after playing the series of 90-minute games. The results were remarkable and extremely durable.

James Korris is president and CEO of Creative Technologies Inc. in Los Angeles, and is a pioneer in immersive game-based simulation for military learning. You can see a preview of the game James designed titled MISSING: The Pursuit of Terry Hughes.

Next, Katy speaks with Carey Morewedge about the game and about his research on effective decision-debiasing techniques. You can learn more in the paper Carey co-authored with James titled "Debiasing Decisions: Improved Decision Making With a Single Training Intervention."

Carey Morewedge is a professor of marketing at Boston University Questrom School of Business who studies psychological biases and how to reduce them.

Finally, Katy speaks with Jack Soll to hear his checklist of four simple ways to debias yourself before making decisions, big or small. You can read more in the article Jack and Katy co-authored with John Payne titled "Outsmart Your Own Biases."

Jack Soll is the Gregory Mario & Jeremy Mario Distinguished Professor of Management and Organizations at Duke University's Fuqua School of Business.

Choiceology is an original podcast from Charles Schwab. For more on the show, visit schwab.com/Choiceology.

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting from Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

Apple, the Apple logo, iPad, iPhone, and Apple Podcasts are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.

Spotify and the Spotify logo are registered trademarks of Spotify AB.

(0524-2GW1)

"Don't judge a book by its cover" is an old adage for a good reason.

Elegant book cover designs can create a positive impression and make you more likely to judge the writing quality more positively. But these traits—cover art and writing—are separate and distinct features of books.

So why do we allow the judgment of one trait to spill over to another unrelated trait?

In this episode of Choiceology with Katy Milkman, we look at a tendency to allow our judgments of one trait of a person (or product or company) to overly influence our judgments of another, unrelated trait of that same person or product or company.

The Traitors is a popular reality TV show, where contestants are assigned either the role of a "Faithful" or "Traitor." Those selected as Traitors eliminate Faithfuls each night and try to keep their identity a secret so the Faithfuls don't vote to eliminate them. By the end of the game, over $100,000 is up for grabs for those left standing. But how can the Faithfuls sniff out the Traitors and decide whom to banish? How do people form judgments of others and decide whom to trust? Wilfred Webster was a contestant on The Traitors, Season 1, on the BBC and played the game brilliantly, leveraging the way he appeared to other contestants to make it to the end.

Wilfred Webster is the runner up to The Traitors, Season 1, on the BBC. Before The Traitors, Will managed face-to-face fundraising for one of the largest charities in the U.K. Today, he's a content creator and fundraising consultant.

Next, Katy speaks with Daniel Read about his research on how our evaluations of a person or product or company on a single trait can spill over and excessively influence our judgments of that same person or product or company on another, separate trait. You can learn more in Daniel's recent paper titled "CSR Halo: The Gift that Keeps on Giving?"

Daniel Read is a professor of behavioral science at Warwick Business School at The University of Warwick in the U.K.

Choiceology is an original podcast from Charles Schwab.

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

Because environmental, social and governance (ESG) strategies exclude some securities, ESG-focused products may not be able to take advantage of the same opportunities or market trends as products that do not use such strategies. Additionally, the criteria used to select companies for investment may result in investing in securities, industries or sectors that underperform the market as a whole.

The book How to Change: The Science of Getting from Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

(0524-ZXT5)

Are rules made to be followed—or meant to be broken?

Often, the answer will depend on culture and the context in which people make decisions.

In this episode of Choiceology with Katy Milkman, we look at how carefully people in different contexts follow social norms, rules, and procedures. We'll also see how strict and relaxed cultures affect the quality of our decisions—and how to find the sweet spot depending on your goals.

Professional kitchens have historically been challenging work environments: high standards, long hours with low pay, and a strong hierarchy of cooks in the kitchen. "Yes, chef" was the only appropriate reply to higher-ranked chefs when Simon Rogan came through the ranks during the 1980s and '90s—a time when kitchen culture was tight and uncompromising. Today, Simon is working hard to change that culture across his restaurant group.

Simon Rogan is a chef and restaurateur in the U.K. whose flagship restaurant, L'Enclume, has three Michelin stars and also holds a Michelin Green Star for its sustainable practices. Simon also runs a culinary program for young chefs called the Academy by Simon Rogan.

Next, Katy speaks with Michele Gelfand about her research on tight and loose cultures and their impact on decision-making in different contexts.

You can learn more from Michele’s paper “Differences Between Tight and Loose Cultures” and take the quiz to determine if you tend to lean tight or loose.

Michele Gelfand is the John H. Scully Professor in Cross-Cultural Management and Organizational Behavior at Stanford University. She’s also a member of the National Academy of Sciences and the author of the book Rule Makers, Rule Breakers: How Tight and Loose Cultures Wire Our World.

Choiceology is an original podcast from Charles Schwab.

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting from Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

Apple, the Apple logo, iPad, iPhone, and Apple Podcasts are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.

Spotify and the Spotify logo are registered trademarks of Spotify AB.

(0424-TPAD)

In this episode of Choiceology with Katy Milkman, we look at how framing a decision based on what you stand to lose versus what you stand to gain affects your tolerance of risk.

Luis Green was a contestant on the popular TV game show Deal or No Deal. The game is largely one of chance, but there are moments during play where the contestant has an option to accept a cash offer to quit. At one point in the game, Luis was offered $333,000 to simply walk away. A guaranteed win! It seems like an obvious choice. But as you’ll hear from the story, there are other factors that influenced his decision.

Katy illustrates these factors with a version of a famous experiment. Volunteers are presented with two differently worded but mathematically identical scenarios. A simple shift from framing the scenario as a potential gain to one of potential loss results in starkly different choices from the volunteers.

Next, Katy speaks with special guest Daniel Kahneman about the underlying theory that explains human behavior in these types of situations. Daniel Kahneman served as professor of psychology and public affairs emeritus at the Woodrow Wilson School and the Eugene Higgins Professor of Psychology Emeritus at Princeton University. He was awarded the 2002 Nobel Prize in Economics for his pioneering research with Amos Tversky. Their work helped establish the field of behavioral economics. Kahneman also wrote the bestselling book Thinking, Fast and Slow.

Finally, Katy speaks with Colin Camerer about some of his favorite studies on risk seeking in the domain of losses, as well as practical approaches for avoiding this less-than-ideal behavior. Colin Camerer is the Robert Kirby Professor of Behavioral Finance and Economics at the California Institute of Technology, where he teaches cognitive psychology and economics. You can read his paper “Prospect Theory in the Wild: Evidence from the Field” here.

Choiceology is an original podcast from Charles Schwab.

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The policy analysis provided by the Charles Schwab & Co., Inc., does not constitute and should not be interpreted as an endorsement of any political party.

The book How to Change: The Science of Getting from Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

(0424-VAX6)