We call ourselves rational. We believe that we are capable of making informed and unbiased decisions between competing options. But we are often blind to the psychological pull we feel to the familiar and the pleasurable and the opposite aversion we have to unpleasant experiences.
Association Bias Causes Us to Make Mistakes
Our past positive and negative experiences unconsciously cause us to make mistakes in our future decision-making. Peter Bevelin explains in Seeking Wisdom:
We automatically feel pleasure or pain when we connect a stimulus – a thing, situation or individual – with an experience we’ve had in the past or with values or preferences we are born with. As we’ve learned, we move towards stimuli we associate with pleasure and away from those we associate with pain. We most easily associate to the event whose consequences we have experienced most often and the ones we easily remember. The more vivid or dramatic an event is, the easier we remember it.
This may seem obvious on its face, but let’s think about the consequences. Your impulse to move towards pleasurable experiences and away from painful experiences can cloud your judgment if you’re unconsciously making decisions based on an item or person’s mere association with something we like or don’t like. If a vendor you work with treats you to a steak dinner and cocktails once a month, you’re more likely to buy from him, even if his prices are too high or his product of poor quality.
Association Bias Causes Us to Miss Opportunities
If you are presented with an opportunity, but it reminds you of a past negative experience, you will have an unconscious bias against the new opportunity unrelated to its present value. For example, if you experienced a loss in a particular business sector or project type, you’ll be inclined to avoid similar projects, even if the underlying market conditions or personalities involved have changed.
Judge Things on Their Own Merits, Not Associations
You’ll make better decisions if you can develop the habit of identifying positive or negative stimuli that you associate with each of your options. Your past experiences are context dependent. Whether past experiences were positive or negative likely was a product of variables including time, circumstance, personality, emotion, psychology, and market. As these variables change, a stimulus that you associate with pain or pleasure is not guaranteed to cause the same pain or pleasure today. It takes work and attention to evaluate things on their own merits instead of on their packaging.