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Hello and welcome to our Week 4 Office 
Hours. 

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Thank you for all of your questions, and 
thank you Dan for joining me once again. 

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 >> My pleasure. 
Is this, is this the last Office Hour? 

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 >> no. 
We have two more, actually. 

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 >> Two more. 
Okay. 

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 >> Maybe three. 
 >> Okay. 

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 >> We'll have to check up on that. 
[LAUGH] Two, two, two. 

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Two, say the authorities. 
I'm very glad that you made it back 

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safely from Boston. 
Yes I was so I was stranded in Boston. 

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I, I landed and about an hour later the 
city went into seize situation. 

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We're not allowed to leave the hotel. 
nobody was allowed to be on the street 

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for quite, quite a long time. 
all my meetings were cancelled, and I had 

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no choice but to spend many hours working 
on the class. 

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 >> [LAUGH] Did you? 
 >> [LAUGH] Yes I did. 

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So, it's, it's interesting, you know, a 
couple of things. 

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First of all, how fortunate I felt to 
have extra time all of a sudden, which 

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kind of sets reflection on the rest of 
my, but. 

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 >> Despite the circumstances also. 
 >> You know, some of my friends they 

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called me up and wrote me, said, are you 
safe?. 

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And I told them, it's probably the safest 
day in Boston, in a long long time. 

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It's, it's very sad but when you think 
about it, the Boston drivers are much 

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more dangerous than some other actions 
but, there's this incredible fear that 

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comes with terror that is, maybe that's 
why we call it terror. 

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That is not proportional to the actual 
danger, and I think if you compare, for 

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example, driving with terror, there's two 
things that are different. 

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One is the intentionality behind it, that 
you think somebody intentionally wants to 

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hurt you, and the second thing is there's 
no way to feel a sense of control. 

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 >> So when you're driving, somebody can 
just slam into you and you have no, no 

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choice. 
You actually had a few experiences. 

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 >> I have, yeah, a pretty terrible one. 
 >> But, but we don't feel this lack of 

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control in driving. 
Whereas in terrorism, we, we do feel this 

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lack of control, that's makes it extra 
special frightening. 

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Actually there's these said results that 
after 9/11 lots of people were afraid of 

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flying, so they switched to driving. 
And because of that, actually more people 

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died than the people who were in the 
planes. 

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It's just that our, our fear from actions 
are different from the things that are 

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actually dangerous and actually risky for 
us. 

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And that's actually one of your assigned 
readings for Week 6, so you'll learn all 

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about it [LAUGH]. 
Just throw that in. 

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so a lot of people are. 
 >> Is this your polite way to tell me I 

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don't remember [CROSSTALK]. 
 >> [LAUGH] It's really that you put so 

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much thought into it. 
 >> I just remember exists in the paper, 

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that's nice. 
 >> Yes, that's true, thank you. 

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That was a very nice description. 
back to terrorism. 

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 >> Yeah. 
 >> Why, what's the psychology 

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underlying this? 
What does behavioral economics have to 

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say about motivation and what can, how do 
we, yeah, what can we do about it, I 

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guess? 
 >> So, there's a question of the 

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psychology of the terrorist. 
 >> Right. 

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 >> Themselves, and then the psychology 
of the people who are on the receiving 

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side of terrorism. 
And then there's a question of what can 

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we do about it. 
I, I read a, I read a very detailed 

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analysis of terrorism a long time ago. 
And what was very interesting about it 

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was the, the fact that they were taking 
these terrorists, I not sure if it 

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happened in this particular case. 
But in many cases of suicide bombers, and 

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they basically isolate them from society, 
from society for a long time. 

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And slowly, slowly, slowly they, they 
tried to create the sense in them that 

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this is their obligation but they 
separate them from the regular circle of 

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life. 
Because if you kept on meeting people and 

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doing regular activities, you would it 
would be very hard to take this extra set 

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of steps. 
So they're, they're doing that kind of 

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separating people from the social circle. 
And then, of course, there's the effect 

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on the people who are effected by, by 
terror and the fear that it's the fear 

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that it's creating. 
Now, as a society, it's very hard to. 

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To do with this, because its a small, 
small group of people into a tremendous 

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psychological devastation. 
And sadly, this is in the area where 

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technology has only made things worse. 
So if you think about, you know, 200 

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years ago, you had a terrorist, what kind 
of damage they could create. 

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They could take a knife and maybe kill a 
few people, very sad. 

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But, but as technology's increasing, the 
potential for a few people to create 

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tremendous damage is very, very high and 
very, very frightening. 

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And I, I suspect, and this is just a 
speculation, that it really is about 

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social inclusion. 
So if you think about terrorists as being 

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isolated in a specific society, and being 
isolated from the daily environment, if 

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we can create more social inclusion. 
That people would be more connected to 

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other people, see more perspectives and 
so on, and not to be disassociated from 

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the daily life of other people. 
Maybe that would be one one way of doing 

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it but very, very tough, to, to think 
about. 

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And then, the other thing is that we, we 
don't like media. 

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If we just wanted to create fear, it is 
so easy to create fear. 

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in fact, in the, in this event in Boston, 
there were cases in which there was 

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somebody created a fake Twitter feed as 
if it was one of by the terrorist. 

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 >> Uh-huh. 
 >> And then the people in the police 

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radio read it and they repeated it and 
that kind of exaggerated the fear. 

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So you remember Orson Welles, of course, 
had these very famous you know, radio 

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fake terrorist, terrorism event in which 
he pretended that there was an invasion. 

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I think now you could do much more damage 
in this, in this regard. 

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And then there are other cases. 
If you look, if you look at the stock 

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market carefully, there's lots of people 
who are using misinformation to their 

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advantages. 
So in the stock market there's this big 

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asymmetry where people from companies are 
restricted about what they can 

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communicate. 
But people who are not from companies, 

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investors are free to say whatever they 
want. 

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And many times, they're basically sell 
short the stock, put fake information out 

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there and then get, get profits from 
that. 

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So, how to, how to think about all of 
those cases in which people are 

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disassociate from the social common good 
is incredibly important. 

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Certainly I don't have good answers for 
this. 

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 >> Right. 
And if you're broadcasting the acts of 

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the terrorist, is that just playing into 
what they wanted in the first place? 

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 >> Yeah. 
I mean there, there, there's a fine line 

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of where information start and ends and 
when it creating fear so I, I was in 

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Boston of course. 
I listen to the news all the time. 

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They had nothing new to say. 
For hours and hours, they would just say 

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the same thing. 
But, you know, at some point, their role 

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is to communicate this information but by 
just communicating it they're just making 

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things worse. 
 >> Right. 

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 >> It would be nice if we talked about 
something else. 

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So there's a, there's a vicious cycle. 
And now that we've talked so much about 

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these terrorism act, everybody knows 
about it. 

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So it becomes a standard for discussion 
and even more frightening and more 

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worrisome and so on. 
 >> So should we not be talking about it 

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right now? 
 >> Yes. 

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 >> Yes, we should? 
 >> Let's talk about puppies. 

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 >> [LAUGH] Puppies are great. 
I'm allergic so. 

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 >> You are? 
 >> yeah. 

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 >> Kittens. 
 >> Kittens too. 

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 >> Kittens too? 
 >> Yeah. 

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 >> Corn? 
 >> no. 

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 >> Flowers? 
 >> Love corn. 

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[LAUGH] 
 >> Chocolates? 

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Chocolate, let's talk about chocolate. 
 >> Chocolate Swiss chocolate. 

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 >> Swiss chocolate. 
 >> Only Swiss chocolate. 

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Actually, let's talk about this weeks 
topic, which is labor and motivation. 

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so our first question someone wants you 
to explain the concept of love as it 

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relates to the effort that we put into 
relationships. 

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So both familial and romantic 
relationships. 

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 >> Yes, so, that's a very broad, broad 
question. 

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I think one simple way to think about 
effort in love is to think about is it 

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worthwhile to play hard to get. 
So the, the expression playing hard to 

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gets means that. 
somebody's trying to approach you. 

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And you basically say, not so interested. 
And then you make them chase you for 

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awhile. 
And the question is, is this an effective 

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strategy? 
And I think the psychology behind it is 

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yes, this is effective. 
And why? 

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It's because labor leads to love, so a 
long time ago, we, we found this not us 

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but physiologists in general, found this 
notion of whats called cognitive 

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dissonance. 
And cognitive dissonance is based in the 

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idea that when we do something, we 
convince ourselves that what we've done 

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is what we want to do. 
And if we don't have other explanation, 

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this reason based logic becomes even 
stronger. 

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So Festinger, when he did one of the 
earlier experiments on this, he got 

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people to screw nuts into a board, for a 
very long time. 

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And some people he paid very little, and 
some people, he paid very generously. 

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And then the question was which one of 
those two groups of people which one of 

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the, which one of the treatments would 
get people to recommend to a higher 

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degree with more enthusiasm, this 
activity. 

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Now, think about what happened. 
You finished doing this for about an 

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hour. 
It was a completely boring task. 

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What happened when you got paid very 
well? 

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You say, this was a boring task. 
I got paid very well, no problem. 

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How much do I recommend it to other 
people? 

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Well, I'm telling them, it's a boring 
task. 

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What if you got paid very badly? 
Now, you have what you call the 

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dissonance. 
You say, I did this for an hour, put a 

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lot of effort into it, but I don't like 
it so much. 

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Now, this tension between those things is 
very uncomfortable. 

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There are two ways to resolve the 
tension. 

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One, you could say, I'm really stupid. 
I really should have not put that much 

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effort into it, I should've just put a 
little bit of effort into it and I don't 

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like it so much. 
That's a hard thing to recognize, to 

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basically criticize or soften this way. 
So what do we say? 

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We say oh, I spent an hour on this. 
I must be the kind of person who really 

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enjoys it. 
Actually it must be a fantastic, 

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wonderful, exciting task. 
And now, you've elevate the joy of the 

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task and you're more likely to recommend 
it to other people. 

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So if you think about romantic love. 
If you chase somebody for a long time, 

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you ask yourself, why did I chase that 
person? 

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And you could say, well, it was really 
stupid of me. 

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I should have never chased this person. 
It has no particular good reason to do it 

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or you could say I must had good reasons, 
it must be a wonderful person chasing 

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them was, was was correct. 
And therefore, you elevate the value of 

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that person in your eyes. 
And this is actually the logic of why 

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playing hard to get is probably a good 
strategy. 

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Now, of course there's, has to be some 
kind of limit to that because at some 

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point, people also give up. 
So you want to kind of fine tune the 

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level of how to get so that people are 
motivated to work hard but not so 

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demotivated that they give up. 
 >> Thank you. 

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 >> Functional advice for life. 
 >> Definitely, definitely. 

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And of course, you all know about the 
Festinger experiments because you've been 

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diligently watching Dan's lecture videos. 
Let's talk about gift giving and 

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receiving. 
I know that you're interested in gifts, 

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because you just recently put out a 
survey asking the class. 

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And what do you think how does the effort 
that someone puts into a gift play into 

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how they feel about the gift, and how the 
receiver feels about the gift. 

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And then also, on the part of the 
receiver, how does the appreciation that 

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they show affect the gift giver? 
 >> Yeah. 

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So, so the reason I'm interested in gifts 
is that of course they're economically 

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not efficient. 
And actually, if you look at it, there's 

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lot's of start ups out there that are 
trying to make gifts more efficient. 

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And you know you have to wonder about how 
much gifts are about the economic 

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efficiency versus about the feeling of 
conveying caring and so on. 

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So I think gifts are incredibly important 
in terms of creating social capital, and 

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get people to care about each other and 
to actually strengthen their bonds. 

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And at the same time, gifts are risky. 
They're risky because we can give things 

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to people that they hate. 
So, if I came to your house and I bought 

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a big gift of something that you have to 
hang on the wall because I'm going to 

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come and visit you every year, but you 
really hate it, it's hideous, right? 

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All of a sudden, I create a tremendous 
burden on you. 

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So, so I think with gifts, we have this 
notion of efficiency versus something 

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that is inefficient like money versus a 
gift. 

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And then on top of that, we have another 
dimension which is something versus not. 

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And I think often especially in the US 
people opt for the gifts that are. 

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Have very low risk, but also very low 
reward. 

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So people often, when they come to 
dinner, bring a bottle of wine or candy, 

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or a cake. 
These are consumables. 

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Even if you don't like them, they'll be 
over. 

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Now, it doesn't really increase 
friendship in a deep way. 

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but it doesn't also has tremendous risk 
with it. 

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And I'm actually interested in trying to 
think about how do we get people to do 

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more risky gifts. 
can I get people to, to do stuff that is 

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could potentially increase friendship 
but, but try to minimize the, the risk 

213
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from it. 
So can we get people to bring pillows and 

214
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furniture and pieces of art and so on, 
and they could backfire. 

215
00:13:56,270 --> 00:13:58,832
I actually get, there were times I get 
all kinds of gifts from people that I 

216
00:13:58,832 --> 00:14:04,196
really wished they didn't give me. 
But, from time to time, I'm so delighted 

217
00:14:04,196 --> 00:14:06,968
that they've given me those things and 
they keep on thinking about those people 

218
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for much longer. 
Then when somebody gives me a bottle of 

219
00:14:11,270 --> 00:14:14,295
wine. 
so, if, if we think of this, this 

220
00:14:14,295 --> 00:14:20,245
connection between easy, thoughtless, no 
risk and no value and then difficult, 

221
00:14:20,245 --> 00:14:25,950
complex, with risk but with potential 
value. 

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If you think about this continuum, I 
think that effort is actually a great way 

223
00:14:31,326 --> 00:14:38,310
to move up the scale of value without 
actually increasing the risk. 

224
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If I buy you something and I tell you the 
story about why I gave you that 

225
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particular gift or I describe the extent 
to which I did. 

226
00:14:46,570 --> 00:14:49,420
So, even if I'm buying you a book and I 
say, you know what, I looked at 17 

227
00:14:49,420 --> 00:14:52,734
different books when I was thinking about 
you. 

228
00:14:52,734 --> 00:14:55,979
And the reason I bought you this 
particular book is not just because the 

229
00:14:55,979 --> 00:14:59,884
salesperson recommended it but, I thought 
about something that I experienced, that 

230
00:14:59,884 --> 00:15:03,459
is connected to this book and I thought 
about what you might experience and how 

231
00:15:03,459 --> 00:15:08,359
you might think about this particular 
author. 

232
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By doing that I'm conveying some of my 
efforts, some of my thought and my guess 

233
00:15:11,879 --> 00:15:15,810
is that I would actually make the book 
better for you. 

234
00:15:15,810 --> 00:15:20,040
You would understand where it came from, 
or why, why you got that. 

235
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And without actually having any of the 
downside of increasing the risk. 

236
00:15:24,640 --> 00:15:26,750
So it's not as if I'm buying you 
something hideous, right? 

237
00:15:26,750 --> 00:15:29,598
So I'm buying the same thing. 
I'm actually elevating the value that 

238
00:15:29,598 --> 00:15:33,228
you're getting from it. 
So it struck me as strange that in many 

239
00:15:33,228 --> 00:15:37,980
cases we give people gifts without trying 
to actually spend time conveying the 

240
00:15:37,980 --> 00:15:42,240
value of the gift. 
How much effort, how much thought? 

241
00:15:42,240 --> 00:15:46,998
Why did I give you this particular gift . 
So if you send something over the mail, 

242
00:15:46,998 --> 00:15:50,710
you know just write something about how, 
how did it started about. 

243
00:15:50,710 --> 00:15:54,472
so, so the, if you think about it again, 
the dimension, I think that effort is 

244
00:15:54,472 --> 00:15:59,790
the, is a perpendicular dimension that 
could just give more, more benefit. 

245
00:15:59,790 --> 00:16:03,861
No matter what you give conveying the 
thoughtfulness is going to be good for 

246
00:16:03,861 --> 00:16:09,368
everybody and we should do it more. 
My birthday is coming soon, by the way, 

247
00:16:09,368 --> 00:16:12,045
if you want to, to think carefully about 
this. 

248
00:16:12,045 --> 00:16:14,328
 >> I'm well aware. 
but now I'm curious what the gifts are 

249
00:16:14,328 --> 00:16:17,895
that the risky ones that you didn't 
appreciate so much. 

250
00:16:17,895 --> 00:16:23,170
 >> So, so, it, I can't say. 
 >> You can't say it here. 

251
00:16:23,170 --> 00:16:26,100
[LAUGH] You can tell me later. 
 >> No, I think, I think, I think it 

252
00:16:26,100 --> 00:16:32,176
particularly comes to a question of art. 
art I think it's very tough to predict 

253
00:16:32,176 --> 00:16:36,986
what people would like and I got a few 
pieces of art that I just passionately 

254
00:16:36,986 --> 00:16:41,780
dislike. 
But the interesting thing is, even though 

255
00:16:41,780 --> 00:16:44,012
I passionately dislike them, I don't 
think worse about the person who gave 

256
00:16:44,012 --> 00:16:47,340
them to me. 
I understand that they don't understand 

257
00:16:47,340 --> 00:16:52,238
me, which is fine, most people don't and. 
 >> They just have terrible taste in 

258
00:16:52,238 --> 00:16:55,444
art[LAUGH]. 
 >> Yeah, but incompatible taste in art 

259
00:16:55,444 --> 00:16:57,830
compared to me. 
 >> Right, sure. 

260
00:16:57,830 --> 00:17:01,542
but the people who gave me a piece of 
art, for example, if somebody gave me a 

261
00:17:01,542 --> 00:17:05,544
piece of art that is on my desk, I think 
about that person almost daily because of 

262
00:17:05,544 --> 00:17:10,124
that, right? 
You think about the benefit, I'm not sure 

263
00:17:10,124 --> 00:17:14,528
if they want me to think about them but 
you know, it's a tremendous benefit. 

264
00:17:14,528 --> 00:17:19,505
so I'm, I'm very interested about how do 
we take the social norm of giving 

265
00:17:19,505 --> 00:17:26,220
chocolate and, and wine. 
Which is again, it, it's so mechanical. 

266
00:17:26,220 --> 00:17:28,300
Somebody gives you a bottle of wine, you 
get it and say oh, thank you so much, and 

267
00:17:28,300 --> 00:17:31,750
we open it. 
That, it's, it's almost like a receipt. 

268
00:17:31,750 --> 00:17:35,976
The, the, it becomes transactional. 
How do we make those meaningful, 

269
00:17:35,976 --> 00:17:40,590
meaningful gifts is, is incredibly 
important. 

270
00:17:40,590 --> 00:17:45,490
I I should point out that when I had my 
first friends who had kids, I, I would 

271
00:17:45,490 --> 00:17:52,673
give them gifts for their kids that would 
make their lives miserable, so I would. 

272
00:17:52,673 --> 00:17:54,344
 >> Oh! 
 >> I would buy them, I bought them a 

273
00:17:54,344 --> 00:17:57,560
big trampoline that the kids love, but of 
course they took a tremendous amount of 

274
00:17:57,560 --> 00:18:00,062
space. 
And I, I bought the kids a drum set, 

275
00:18:00,062 --> 00:18:01,329
which of course. 
 >> Oh my god. 

276
00:18:01,329 --> 00:18:04,874
 >> Was great fun for the kids. 
I, I've learned to think differently 

277
00:18:04,874 --> 00:18:08,905
about gifts for parents once I had my own 
kids. 

278
00:18:08,905 --> 00:18:11,342
 >> [LAUGH] Things that don't create 
noise, maybe. 

279
00:18:11,342 --> 00:18:14,518
 >> Yes. 
 >> And so, what about the other side of 

280
00:18:14,518 --> 00:18:17,337
gifts? 
 >> When, as the gift giver, the 

281
00:18:17,337 --> 00:18:22,044
appreciation that the recipient shows, 
how does that influence? 

282
00:18:22,044 --> 00:18:25,990
 >> So, so, this is tremendously 
important. 

283
00:18:25,990 --> 00:18:29,920
So, so gifts, gifts are really about the 
bond between people. 

284
00:18:29,920 --> 00:18:34,820
It's kind of an investment in friendship 
and you want the investment to be two 

285
00:18:34,820 --> 00:18:38,768
directional. 
You want to do something for the other 

286
00:18:38,768 --> 00:18:42,338
person and then you want them to 
appreciate you back. 

287
00:18:42,338 --> 00:18:45,758
I think sometimes there's a, there's a 
risk that gifting is kind of an 

288
00:18:45,758 --> 00:18:49,463
escalating game in which if you give 
somebody a gift and then they remember 

289
00:18:49,463 --> 00:18:54,995
what kind of gift you gave them and 
there's a need to do it back. 

290
00:18:54,995 --> 00:18:59,825
the, the, American, I've never gotten 
very good at writing thank you notes, but 

291
00:18:59,825 --> 00:19:04,270
I think thank-you notes are actually 
wonderful. 

292
00:19:04,270 --> 00:19:07,370
If, if you just write a standard form, 
not, not very interesting but, if you 

293
00:19:07,370 --> 00:19:10,570
write a thoughtful thank-you note about 
why do I appreciate that and how it's 

294
00:19:10,570 --> 00:19:15,844
going to fit in my life and so on, I 
think this will be a great, great gift. 

295
00:19:15,844 --> 00:19:18,980
As a rule, I would say you probably never 
want to give somebody a gift that they 

296
00:19:18,980 --> 00:19:22,959
don't have a good reason to write you a 
thank you note for it. 

297
00:19:22,959 --> 00:19:26,223
If you're going to give somebody a gift 
that you don't expect a thank you note, 

298
00:19:26,223 --> 00:19:29,300
you probably should give something else. 
 >> All right. 

299
00:19:29,300 --> 00:19:33,960
Good to know. 
and so what about regifting? 

300
00:19:33,960 --> 00:19:38,315
Let's say you get something of really 
high value but you don't really nee d it, 

301
00:19:38,315 --> 00:19:43,367
don't have a place for it. 
how could you give that to someone else 

302
00:19:43,367 --> 00:19:49,018
without conveying the fact that you got 
it for free but also not you know. 

303
00:19:49,018 --> 00:19:50,664
 >> Yeah. 
 >> Giving them the pressure to 

304
00:19:50,664 --> 00:19:54,699
reciprocate at that same level. 
 >> Yeah, so, so regifting is terrible 

305
00:19:54,699 --> 00:19:59,451
problem because there was the, the chance 
that somebody will say this is something 

306
00:19:59,451 --> 00:20:04,681
that you don't like personally, right? 
And you think that for some reason I 

307
00:20:04,681 --> 00:20:05,880
would, 
 >> Mm-hm. 

308
00:20:05,880 --> 00:20:09,186
 >> I would like it. 
So I think there's some, there's some 

309
00:20:09,186 --> 00:20:12,309
cases in which regifting could be, could 
be okay. 

310
00:20:12,309 --> 00:20:15,189
If you have shoes that are the wrong size 
for example, I, I don't think anybody 

311
00:20:15,189 --> 00:20:18,818
would feel that this is wrong. 
But if you had a piece of art and you say 

312
00:20:18,818 --> 00:20:21,890
you know, I really hate this there's no 
way that I could do it but you really 

313
00:20:21,890 --> 00:20:26,260
have an inferior taste, I think this 
would be good for you. 

314
00:20:26,260 --> 00:20:31,135
So the, there are cases in which 
regifting is talking about the particular 

315
00:20:31,135 --> 00:20:38,410
lack of suitability of that gift and me, 
and then I think regifting could be okay. 

316
00:20:38,410 --> 00:20:42,890
And there's a case of regifting that has 
kind of a hierarchy of taste, which is 

317
00:20:42,890 --> 00:20:47,477
incredibly problematic. 
The easiest case for regifting is a case 

318
00:20:47,477 --> 00:20:51,041
in which you say I have something like 
this already, so now you're not conveying 

319
00:20:51,041 --> 00:20:54,356
anything. 
In fact, you're saying I have, I got two 

320
00:20:54,356 --> 00:20:57,040
of those things at the same time, I love 
them. 

321
00:20:57,040 --> 00:21:02,402
I've learned how wonderful they are so 
I'm, I'm giving it, I'm giving it to you. 

322
00:21:02,402 --> 00:21:07,869
[COUGH], there, there's another version 
of trying to create regifting, which is 

323
00:21:07,869 --> 00:21:12,963
a, a less of an act of giving. 
So if I take something and I, I got it as 

324
00:21:12,963 --> 00:21:16,373
a gift and I don't like it so much, and I 
come to you and I say, hey this is a gift 

325
00:21:16,373 --> 00:21:20,399
for you. 
that's, that I think is a very 

326
00:21:20,399 --> 00:21:23,548
problematic set of actions unless I could 
say, I got two of them and so on, it's 

327
00:21:23,548 --> 00:21:27,664
not my size. 
but I think there could be a version in 

328
00:21:27,664 --> 00:21:31,690
which I say, here are the things that I 
have that I don't find a current need 

329
00:21:31,690 --> 00:21:35,680
for. 
I have an extra jacket. 

330
00:21:35,680 --> 00:21:37,830
I have some ski poles. 
I have all these things that I don't 

331
00:21:37,830 --> 00:21:40,644
really need. 
And if you as my friend is interested in 

332
00:21:40,644 --> 00:21:45,300
any of those things I would love to give 
them to you. 

333
00:21:45,300 --> 00:21:48,683
That's a different version of, of giving. 
You're not taking the act of giving as it 

334
00:21:48,683 --> 00:21:51,810
is, and saying you just don't care so 
much about me. 

335
00:21:51,810 --> 00:21:55,275
In fact you're saying here are things 
that if you're interested I'm happy to 

336
00:21:55,275 --> 00:21:58,630
give them to you and, it's a very 
different exchange but I think it will 

337
00:21:58,630 --> 00:22:02,040
have a similar connection and a, a 
similar increase in the bond between two 

338
00:22:02,040 --> 00:22:06,734
people. 
Because all of a sudden I have something 

339
00:22:06,734 --> 00:22:10,309
that you're not pretending you like me 
and you're giving it to me and you've 

340
00:22:10,309 --> 00:22:15,295
thought about me and so on. 
It's just something you don't have use, 

341
00:22:15,295 --> 00:22:18,320
and if I can think that I will have a 
good use for it, that's actually 

342
00:22:18,320 --> 00:22:22,322
beneficial. 
So I, there's actually startups that is 

343
00:22:22,322 --> 00:22:26,074
trying to work through Facebook and 
similar things, and basically say could 

344
00:22:26,074 --> 00:22:30,658
everybody that has extra stuff. 
Just say here's the extra stuff I have I 

345
00:22:30,658 --> 00:22:35,100
don't really need. 
if you are one of my close friends. 

346
00:22:35,100 --> 00:22:38,393
You're very welcome to use it. 
And I, I suspect, I don't know if it is, 

347
00:22:38,393 --> 00:22:43,180
but I suspect it would actually increase 
social, social capital. 

348
00:22:43,180 --> 00:22:46,267
And you could give in that way things 
that you could never give in a direct, in 

349
00:22:46,267 --> 00:22:49,864
a direct way. 
So I, I'm, I'm hopeful, I'm hopeful that 

350
00:22:49,864 --> 00:22:53,876
gift giving is actually going to improve, 
that the, the Internet social networks 

351
00:22:53,876 --> 00:22:58,800
and so on, are going to help us do it in 
a, in a better way. 

352
00:22:58,800 --> 00:23:02,220
Less in a way of, of giving people 
meaningless stuff and more in the way of 

353
00:23:02,220 --> 00:23:07,377
creating social connections. 
Trying to think, what's the best gift 

354
00:23:07,377 --> 00:23:10,839
you've got, can you think about that? 
 >> Well, last year for my birthday, I 

355
00:23:10,839 --> 00:23:16,291
got this really fancy knife. 
It was an excellent gift. 

356
00:23:16,291 --> 00:23:18,390
 >> Isn't it, aren't you not supposed to 
give knives to people? 

357
00:23:18,390 --> 00:23:19,848
 >> [LAUGH]. 
 >> Is there like a bad luck connected 

358
00:23:19,848 --> 00:23:21,907
to this? 
 >> Dan gave me a knife last year for my 

359
00:23:21,907 --> 00:23:22,932
birthday. 
[LAUGH] 

360
00:23:22,932 --> 00:23:25,040
 >> [LAUGH]. 
 >> That's the context. 

361
00:23:25,040 --> 00:23:27,695
 >> I told, I, I, I thought there was 
an, somebody told me that there was some 

362
00:23:27,695 --> 00:23:31,448
bad luck connected to giving. 
 >> You know, I've never heard that but. 

363
00:23:31,448 --> 00:23:33,020
 >> Right. 
 >> But it is my favorite knife. 

364
00:23:33,020 --> 00:23:34,930
 >> Okay. 
 >> And its really wonderful. 

365
00:23:34,930 --> 00:23:37,830
I've only cut myself actually still have 
some scars from it. 

366
00:23:37,830 --> 00:23:41,529
 >> Yeah, yeah. 
I think that good gifts are things that 

367
00:23:41,529 --> 00:23:44,776
you would use frequently. 
 >> Uh-hm. 

368
00:23:44,776 --> 00:23:49,155
 >> But you don't feel comfortable 
buying it for yourself. 

369
00:23:49,155 --> 00:23:51,460
 >> Right. 
 >> These are the kind of ideal gift. 

370
00:23:51,460 --> 00:23:55,972
That's my my principle so far. 
 >> Yes, I would never spend that much 

371
00:23:55,972 --> 00:24:00,022
on a knife, so thank you. 
[LAUGH] so, we're going to switch gears 

372
00:24:00,022 --> 00:24:04,472
here a little bit. 
Let's talk about payment systems and 

373
00:24:04,472 --> 00:24:09,735
salaries and so on. 
What do you think the right interval for 

374
00:24:09,735 --> 00:24:14,003
paying employees is? 
 >> In terms of timing? 

375
00:24:14,003 --> 00:24:17,684
 >> Right, yeah. 
So you can pay someone by the minute 

376
00:24:17,684 --> 00:24:22,854
presumably biweekly, monthly and you 
know, yearly? 

377
00:24:22,854 --> 00:24:27,894
 >> Yearly, so I think it has to do with 
the society we live in and the interval 

378
00:24:27,894 --> 00:24:33,185
of expenses. 
So in a very basic way, I think we need 

379
00:24:33,185 --> 00:24:40,590
to have some symmetry between when you 
get paid and when you get expenses. 

380
00:24:40,590 --> 00:24:44,178
And when the symmetry is high, people can 
organize their expenses and think better 

381
00:24:44,178 --> 00:24:48,380
about their money and how much they have 
and how much they don't. 

382
00:24:48,380 --> 00:24:53,761
So, so part of it is having this, this 
fit between the system. 

383
00:24:53,761 --> 00:24:58,853
So many things in the world happen on 
monthly system, your monthly mortgage, 

384
00:24:58,853 --> 00:25:04,841
your electricity, check and so on. 
I think it would have been great if all 

385
00:25:04,841 --> 00:25:08,054
of those happen on the same day, and it 
all, all happened on the same day or the 

386
00:25:08,054 --> 00:25:13,835
day after when your salary came in. 
So that's for the functional use of 

387
00:25:13,835 --> 00:25:16,700
understanding your income and your 
expenses. 

388
00:25:16,700 --> 00:25:21,153
Then there's the issue of daily expenses 
by coffee lunch and so on. 

389
00:25:21,153 --> 00:25:25,307
And from, from a planning perspective, it 
would have been very nice if it had a 

390
00:25:25,307 --> 00:25:29,285
stream of income. 
So, there's some really beautiful 

391
00:25:29,285 --> 00:25:34,510
results, showing that if you pay people 
on the biweekly schedule, for example. 

392
00:25:34,510 --> 00:25:37,743
People spend way too much on the first 
day when they get the salary and then 

393
00:25:37,743 --> 00:25:42,130
they run out of money toward the end of 
the period. 

394
00:25:42,130 --> 00:25:45,302
So, I would've liked to create a system 
in which we pay people part of their 

395
00:25:45,302 --> 00:25:49,912
salary on the monthly basis in the way 
that fits all of their expenses. 

396
00:25:49,912 --> 00:25:54,360
And then another month we would pay them 
on a daily basis. 

397
00:25:54,360 --> 00:25:58,782
And I think for example, it would be nice 
to have a debit card that every day you 

398
00:25:58,782 --> 00:26:04,387
get extra money on that debit card. 
And that would help me plan, if it was 

399
00:26:04,387 --> 00:26:09,590
me, it would help me plan how much I can 
spend on any particular day. 

400
00:26:09,590 --> 00:26:14,650
Then, you would want a part of the salary 
to, to go to long term savings. 

401
00:26:14,650 --> 00:26:17,752
So, from, from this perspective, you 
know, from the planning perspective, you 

402
00:26:17,752 --> 00:26:22,989
say, well, how's my flow of income going 
to be connected to my flow of expenses? 

403
00:26:22,989 --> 00:26:25,080
And then finally, there's a question of 
happiness. 

404
00:26:25,080 --> 00:26:27,720
It was a question of how do you get 
people to use their money in the way that 

405
00:26:27,720 --> 00:26:32,000
makes them, makes them happy. 
And for that I think that bonuses are 

406
00:26:32,000 --> 00:26:36,045
actually very good. 
so usually when I ask my students, I say 

407
00:26:36,045 --> 00:26:39,880
what would you rather have, would you 
rather have a fixed increase in salary or 

408
00:26:39,880 --> 00:26:45,034
a, a bonus at the end of the year? 
Most people say if the amount of money's 

409
00:26:45,034 --> 00:26:47,720
roughly similar, I prefer the monthly 
expenses. 

410
00:26:47,720 --> 00:26:51,338
I can, you know, save and so on. 
And then I say which one would make you 

411
00:26:51,338 --> 00:26:53,996
happier? 
And people say, oh yes, if I got a bonus 

412
00:26:53,996 --> 00:26:56,320
I would actually be happier. 
Why? 

413
00:26:56,320 --> 00:26:58,930
Because if the money would come in 
specific intervals, we'd probably 

414
00:26:58,930 --> 00:27:01,720
increase the quality of our life in a 
fixed way, buy a slightly bigger home, 

415
00:27:01,720 --> 00:27:06,980
slightly bigger car, something like that, 
spend more money on groceries. 

416
00:27:06,980 --> 00:27:10,640
But if money came as a bonus, I would 
probably feel more free to spend it on 

417
00:27:10,640 --> 00:27:14,605
things that are happiness increasing, 
buying a new bicycle or something like 

418
00:27:14,605 --> 00:27:18,297
that. 
But then again, if a bonus comes at 

419
00:27:18,297 --> 00:27:21,713
expected time every year, you start 
building on it and planning on it, and 

420
00:27:21,713 --> 00:27:25,971
that's not as, as useful. 
So I, I would think about two separate 

421
00:27:25,971 --> 00:27:29,184
issues, I would say how do you give a 
salary in a way that helps people manager 

422
00:27:29,184 --> 00:27:33,104
their money. 
And then how do you give a bonus in an 

423
00:27:33,104 --> 00:27:36,750
unpredictable way that makes people 
happier. 

424
00:27:36,750 --> 00:27:42,410
And that bonus I would try to give 
probably in three ways. 

425
00:27:42,410 --> 00:27:45,320
I would probably try to give part of it 
in money. 

426
00:27:45,320 --> 00:27:49,450
I would try to give part of it in gifts 
and I would try to give part of it, as 

427
00:27:49,450 --> 00:27:54,070
Mike has talked about, in allowing people 
to give money away So that will be kind 

428
00:27:54,070 --> 00:27:59,960
of my idea of the salary structure. 
We are not there yet. 

429
00:27:59,960 --> 00:28:02,136
 >> No. 
Then let's go there [LAUGH]. 

430
00:28:02,136 --> 00:28:04,545
 >> Very good. 
 >> that's actually a very nice segue to 

431
00:28:04,545 --> 00:28:08,615
our next question about big bonuses. 
 >> So bonuses, sure, are great, but you 

432
00:28:08,615 --> 00:28:12,263
talk about the down side of really huge 
bonuses, especially in the financial 

433
00:28:12,263 --> 00:28:14,741
industry. 
 >> Yes. 

434
00:28:14,741 --> 00:28:18,440
 >> How do we deal with this culture 
that is perpetuating? 

435
00:28:18,440 --> 00:28:19,900
It already exists. 
It's there. 

436
00:28:19,900 --> 00:28:22,345
People expect their big bonuses. 
Now what? 

437
00:28:22,345 --> 00:28:24,986
 >> Yeah. 
So, so cultural changes very, are very 

438
00:28:24,986 --> 00:28:28,328
tough, and they're particularly tough in 
a competitive world. 

439
00:28:28,328 --> 00:28:31,448
And they're particularly tough in a 
competitive world in which everybody who 

440
00:28:31,448 --> 00:28:34,670
gets paid with bonuses want to get paid 
with bonuses. 

441
00:28:34,670 --> 00:28:37,742
So, you know, if you, if you think about 
banks and you think about the boards of 

442
00:28:37,742 --> 00:28:42,460
these banks are built by people, other 
banks and it's kind of a closed system. 

443
00:28:42,460 --> 00:28:46,065
Why would they ever, why would they ever 
switch? 

444
00:28:46,065 --> 00:28:50,219
and I think it's one of those cases which 
can be incredibly tough for any 

445
00:28:50,219 --> 00:28:54,948
particular bank to start doing something 
differently. 

446
00:28:54,948 --> 00:28:59,620
And that's where regulations come in. 
Regulations come in where you have a 

447
00:28:59,620 --> 00:29:03,778
solution the, of a coordinated system 
that is just not bad for the whole, for 

448
00:29:03,778 --> 00:29:09,460
the whole system. 
and I'll give an example of this, there's 

449
00:29:09,460 --> 00:29:13,790
imagine a game called the public good 
game. 

450
00:29:14,900 --> 00:29:19,730
you have ten people around the room each 
of them has $10 and each of them can put 

451
00:29:19,730 --> 00:29:25,183
as much as they want in a pot. 
If they, nobody sees what they put in, 

452
00:29:25,183 --> 00:29:29,278
but the moment they put in all the money, 
the money grows by let's say twice, and 

453
00:29:29,278 --> 00:29:35,540
then the money is divided by everybody. 
So if we have ten people, each of them 

454
00:29:35,540 --> 00:29:39,430
can get $10. 
Everybody puts in $10, $100 grows to 

455
00:29:39,430 --> 00:29:43,230
$200. 
Everybody gets 10% of it. 

456
00:29:43,230 --> 00:29:47,269
Everybody gets $20, that's great. 
But imagine if one day you decide not to 

457
00:29:47,269 --> 00:29:50,100
put your money in. 
What happens? 

458
00:29:50,100 --> 00:29:53,376
Nine people. 
Everybody puts their money in, $90 grows 

459
00:29:53,376 --> 00:29:57,723
to by twice, $180 dollars, divide by 10, 
you get $18 dollars, but you also get 

460
00:29:57,723 --> 00:30:02,780
your 10 dollars. 
So you get 28, you get your benefit. 

461
00:30:02,780 --> 00:30:05,348
What happens? 
For a while, everybody behaves nicely, 

462
00:30:05,348 --> 00:30:10,061
everybody puts their $10. 
And then one time somebody doesn't, and 

463
00:30:10,061 --> 00:30:15,066
then the other people say hey, how come I 
only got $18, and then very quickly 

464
00:30:15,066 --> 00:30:20,731
nobody puts anything in. 
And, and this is a situation which if you 

465
00:30:20,731 --> 00:30:24,493
let the system decide by itself how it 
does, it can actually deteriorates to the 

466
00:30:24,493 --> 00:30:28,654
disadvantage of everybody. 
And I think that's probably a good 

467
00:30:28,654 --> 00:30:33,346
analogy for what happens in the banking. 
can you be the first bank to behave 

468
00:30:33,346 --> 00:30:35,030
nicely? 
No. 

469
00:30:35,030 --> 00:30:36,606
Right? 
It will be very hard because the bankers 

470
00:30:36,606 --> 00:30:40,360
who work for you will say we prefer to 
work for other banks and get paid better. 

471
00:30:40,360 --> 00:30:45,170
The fact that we understand that big 
bonuses don't work don't mean that people 

472
00:30:45,170 --> 00:30:49,205
don't want them. 
If somebody would offer me at the 

473
00:30:49,205 --> 00:30:53,235
university to get paid, you know, an 
extra 90%, 900% of my salary as a bonus, 

474
00:30:53,235 --> 00:30:57,696
I wouldn't say no. 
Now, it might not be good for the 

475
00:30:57,696 --> 00:31:01,659
university, but for me personally, right. 
Even if it's not that effective and it's 

476
00:31:01,659 --> 00:31:04,974
not good for the system, it's good for me 
personally and if I get to choose my own 

477
00:31:04,974 --> 00:31:08,192
salary. 
So this is the kind of case where it's 

478
00:31:08,192 --> 00:31:13,656
actually, we need collective action. 
We need to government to come and say we 

479
00:31:13,656 --> 00:31:19,020
need everybody in the system and we're 
just forcing you to behave differently. 

480
00:31:19,020 --> 00:31:23,263
Now, will this happen? 
I have very little faith that this would 

481
00:31:23,263 --> 00:31:26,772
happen. 
So, what I'm hoping, what I'm hoping is 

482
00:31:26,772 --> 00:31:33,770
that there will be a new kind of banking 
that would emerge from consumer demand. 

483
00:31:33,770 --> 00:31:36,838
I'm hoping there will be some 
organization that would say, we're going 

484
00:31:36,838 --> 00:31:40,605
to create a new type of bank. 
And we will have fixed, reasonable 

485
00:31:40,605 --> 00:31:44,235
salaries, we would not have conflicts of 
interest, we will be straight forward 

486
00:31:44,235 --> 00:31:49,456
about what, what we're doing. 
And, and that this bank would be created 

487
00:31:49,456 --> 00:31:53,922
out of spirit of Importance, 
understanding of how crucial banks are, 

488
00:31:53,922 --> 00:32:00,357
and some kind of mission and commitment. 
And I think a bank like this could draw 

489
00:32:00,357 --> 00:32:04,277
substantial talent. 
Because after all, we don't think about 

490
00:32:04,277 --> 00:32:08,417
bankers as evil and there's lots of 
people in the world who want to work in 

491
00:32:08,417 --> 00:32:13,547
all kinds of fulfilling jobs. 
Banking has kind of taken personal 

492
00:32:13,547 --> 00:32:17,832
fulfillment mostly out of the system. 
But it doesn't mean it has to have no 

493
00:32:17,832 --> 00:32:21,120
personal fulfillment in a sense of 
mission. 

494
00:32:21,120 --> 00:32:25,026
And I think that once a bank like this 
would be created, many consumers will, 

495
00:32:25,026 --> 00:32:29,920
will start moving to it, creating 
pressures on the other bank. 

496
00:32:29,920 --> 00:32:32,290
I'm, I'm at least hoping that this, this 
would happen. 

497
00:32:32,290 --> 00:32:35,113
It's not going to be fast, and it's not 
easy. 

498
00:32:35,113 --> 00:32:39,143
And actually, sadly, the regulation on 
banking in the US have made this, a kind 

499
00:32:39,143 --> 00:32:43,235
of action like this is more difficult 
because now the requirements on banks are 

500
00:32:43,235 --> 00:32:49,780
making it harder to open a new banks. 
But I'm still hopeful that something like 

501
00:32:49,780 --> 00:32:53,547
this would emerge. 
 >> I actually just read a paper on 

502
00:32:53,547 --> 00:32:58,446
salary caps, where the researchers were 
asking people what they thought about 

503
00:32:58,446 --> 00:33:03,257
salary caps. 
And at what point it would be appropriate 

504
00:33:03,257 --> 00:33:07,870
to say okay, you've already made $20 
million, you're done. 

505
00:33:07,870 --> 00:33:09,695
 >> Yeah. 
 >> how do you feel about that? 

506
00:33:09,695 --> 00:33:19,012
 >> I, I think I'm not sure what, what 
rule I would use on salary caps. 

507
00:33:19,012 --> 00:33:23,587
because I, I want something that that 
seems a fair and just and you know 

508
00:33:23,587 --> 00:33:28,312
salaries at those levels, salaries are 
not so much about the money, they're 

509
00:33:28,312 --> 00:33:34,659
about appreciation. 
it's, it's kind of a game of accumulating 

510
00:33:34,659 --> 00:33:39,987
money but also accumulating a sense of 
thankfulness and, and, and reciprocation 

511
00:33:39,987 --> 00:33:45,178
and so on. 
so I, I think that if the rule was just 

512
00:33:45,178 --> 00:33:50,443
about the salary cap, I, I, I worry it 
would not represent correctly the spirit 

513
00:33:50,443 --> 00:33:55,159
of. 
The connection between employee and 

514
00:33:55,159 --> 00:33:58,866
employer and the CEO and so on. 
So I, I think we need to have a rule 

515
00:33:58,866 --> 00:34:04,140
that, that takes into account mutual 
respect and understanding. 

516
00:34:04,140 --> 00:34:08,236
And but, but if it was just a salary cap 
and externally imposed, like, like the 

517
00:34:08,236 --> 00:34:12,268
minimum wage but on the opposite side, I 
I think it would make the whole thing 

518
00:34:12,268 --> 00:34:18,355
looks much more mechanical. 
I, I would much prefer to say let's think 

519
00:34:18,355 --> 00:34:23,942
about other attributes of the job. 
Let's think about how much of the, lot's 

520
00:34:23,942 --> 00:34:30,790
of companies have to give money to 
foundations, and give money to charity. 

521
00:34:30,790 --> 00:34:34,511
How do give the CEO of a successful 
company a bigger say in where this money 

522
00:34:34,511 --> 00:34:38,186
goes? 
how do you let them do more intervention, 

523
00:34:38,186 --> 00:34:42,281
opening new departments , getting more 
reputation, calling your building on 

524
00:34:42,281 --> 00:34:45,616
them. 
I mean there's lots of things that you 

525
00:34:45,616 --> 00:34:49,368
can do that are not just about pure money 
but actually has recognition of time and 

526
00:34:49,368 --> 00:34:53,777
effort. 
You know, when I meet CEOs, you know, 

527
00:34:53,777 --> 00:34:59,386
often, often, not always, but, but, often 
I'm impressed with their commitment, care 

528
00:34:59,386 --> 00:35:04,363
and I think to say that these CEOs just 
don't care, they're just there for the 

529
00:35:04,363 --> 00:35:14,124
money is a very strange thing. 
So I would much prefer to take activities 

530
00:35:14,124 --> 00:35:19,766
and dimensions are away from just 
focusing on the salary is there long term 

531
00:35:19,766 --> 00:35:24,408
benefit. 
I've always wanted to do this thing with 

532
00:35:24,408 --> 00:35:28,048
teachers where you would ask students 
after they leave school, after they're 

533
00:35:28,048 --> 00:35:32,159
18, once a year. 
To write a letter to one teacher that has 

534
00:35:32,159 --> 00:35:35,108
influenced your life. 
 >> Mm-hm. 

535
00:35:35,108 --> 00:35:38,860
 >> and I thought, you know, what would 
happen to teachers who, who get these, 

536
00:35:38,860 --> 00:35:42,487
these letters. 
You know, you know I, I, I teach all the 

537
00:35:42,487 --> 00:35:45,679
kids but you know, I teach it and from 
time to time I get emails from my 

538
00:35:45,679 --> 00:35:49,736
students. 
And it's always really delightful to, to 

539
00:35:49,736 --> 00:35:53,555
know what, what happened to them and have 
they used a particular fact in, in one of 

540
00:35:53,555 --> 00:35:59,158
their activities. 
But when I think about elementary school 

541
00:35:59,158 --> 00:36:02,213
teacher, middle school teacher, high 
school teachers, I think they probably 

542
00:36:02,213 --> 00:36:05,640
almost never get the realization of what 
has happened. 

543
00:36:05,640 --> 00:36:08,190
And partially, it's hard to learn in that 
environment. 

544
00:36:08,190 --> 00:36:11,870
Imagine you had a kid like me. 
As an elementary school teacher my, my 

545
00:36:11,870 --> 00:36:15,665
elementary school teacher weren't happy 
with me[LAUGH]. 

546
00:36:15,665 --> 00:36:18,226
 >> [LAUGH] No? 
Not the ideal kid but I think knowing 

547
00:36:18,226 --> 00:36:21,817
that appreciating in retrospect and 
knowing that things have not, I did not 

548
00:36:21,817 --> 00:36:25,980
become the juvenile delinquent that they 
expected. 

549
00:36:25,980 --> 00:36:31,873
I think with both give, give them a sense 
of accomplishment and also a, a different 

550
00:36:31,873 --> 00:36:36,668
way to view difficult kids. 
 >> Yeah. 

551
00:36:36,668 --> 00:36:40,860
I actually just wrote my 7th grade 
science teacher a couple months ago. 

552
00:36:40,860 --> 00:36:43,100
 >> Oh, very good. 
 >> Telling him I appreciated him and it 

553
00:36:43,100 --> 00:36:44,900
was a great class. 
 >> That's good. 

554
00:36:44,900 --> 00:36:49,650
 >> And I still remember all like 
kingdom phyla, all of that. 

555
00:36:49,650 --> 00:36:51,550
yeah, so. 
 >> That's great. 

556
00:36:51,550 --> 00:36:53,334
 >> Some people do. 
 >> Great. 

557
00:36:53,334 --> 00:36:55,792
 >> and more people should, I guess. 
 >> Yep. 

558
00:36:55,792 --> 00:36:58,552
 >> That's the lesson. 
 >> let's talk a little bit about the 

559
00:36:58,552 --> 00:37:02,000
IKEA effect. 
What do you think the impact of time has 

560
00:37:02,000 --> 00:37:05,440
on the IKEA effect? 
So, you've created something, you think 

561
00:37:05,440 --> 00:37:09,010
it's really awesome and then over time 
does that diminish? 

562
00:37:09,010 --> 00:37:12,259
Does it grow or do you know? 
 >> So, I don't know but I can speculate 

563
00:37:12,259 --> 00:37:14,290
of course. 
 >> [LAUGH]. 

564
00:37:14,290 --> 00:37:19,280
 >> And so, so I think it's a lot like 
other effects over time. 

565
00:37:19,280 --> 00:37:21,330
What the question is what happens in this 
time? 

566
00:37:21,330 --> 00:37:25,203
So, so think about something like 
emotions, all right. 

567
00:37:25,203 --> 00:37:29,818
You get angry or you get happy, to happy 
or angry, and then if you do nothing, the 

568
00:37:29,818 --> 00:37:35,562
emotion will just go away. 
But if you do something in the middle, 

569
00:37:35,562 --> 00:37:40,699
when you're happy or when you're angry. 
That memory of that action can stay with 

570
00:37:40,699 --> 00:37:46,366
you, much like Festinger's story. 
So imagine a case in which you're, you're 

571
00:37:46,366 --> 00:37:51,262
you're very happy and for some reason, 
you decide to start donating money every 

572
00:37:51,262 --> 00:37:55,811
Friday. 
Or you decide to open a, a savings 

573
00:37:55,811 --> 00:37:59,891
account, or you're very happy and 
optimistic and you decide to, to do 

574
00:37:59,891 --> 00:38:03,850
something. 
You, you register for a gym. 

575
00:38:03,850 --> 00:38:07,632
So, so your happiness, or misery, can 
translate to a decision, and then you 

576
00:38:07,632 --> 00:38:11,658
probably don't remember how you felt and 
what caused you to behave that way, but 

577
00:38:11,658 --> 00:38:17,660
that decision to, could start have a life 
of its own. 

578
00:38:17,660 --> 00:38:20,846
And, and I think the same thing can 
happen with the IKEA effect, that you 

579
00:38:20,846 --> 00:38:24,248
build something and so on and if you just 
forget about it, the effect would go 

580
00:38:24,248 --> 00:38:28,445
away. 
But if you, something happens in the 

581
00:38:28,445 --> 00:38:33,699
middle which reminds of it then you keep 
using it and so on that will have its own 

582
00:38:33,699 --> 00:38:39,063
activity. 
So for example, I think that if you build 

583
00:38:39,063 --> 00:38:44,328
shelves in a room that you don't, like in 
the garage, you don't ever look at, the 

584
00:38:44,328 --> 00:38:52,292
happiness would go away. 
But if you build something that is going 

585
00:38:52,292 --> 00:38:58,490
to be in use daily and you remind 
yourself about it then. 

586
00:38:58,490 --> 00:39:00,375
Then the repeated use will probably 
remind you. 

587
00:39:00,375 --> 00:39:04,580
So probably things with drawers are 
better to create. 

588
00:39:04,580 --> 00:39:07,180
Because yo keep on, you keep on using 
them. 

589
00:39:07,180 --> 00:39:11,070
Probably things that are in the more 
central place in the house. 

590
00:39:11,070 --> 00:39:15,060
are more useful so from that prospective 
you can think about what do they, things 

591
00:39:15,060 --> 00:39:20,950
that you reuse. 
Often would rekindle your memory of 

592
00:39:20,950 --> 00:39:24,228
creating it. 
Maybe you need to sign it, if you do 

593
00:39:24,228 --> 00:39:28,062
something you draw you should sign it. 
 >> Or something you wear like jewelry. 

594
00:39:28,062 --> 00:39:31,782
 >> I think if it's something you wear 
all the time, you would probably forget, 

595
00:39:31,782 --> 00:39:35,740
but if you put it on and off, that would 
be good. 

596
00:39:35,740 --> 00:39:37,818
If it's something that you wear on 
special occasions. 

597
00:39:37,818 --> 00:39:40,404
All of those would be very good. 
 >> All right. 

598
00:39:40,404 --> 00:39:42,930
 >> Jewelry by the way, it's probably a, 
a very good gift as well. 

599
00:39:42,930 --> 00:39:46,696
Especially if you helped created it. 
 >> Mm-hm. 

600
00:39:46,696 --> 00:39:50,110
 >> Or thought about it. 
 >> So think about things that other 

601
00:39:50,110 --> 00:39:54,602
people make, for you. 
Let's say you are in a restaurant and you 

602
00:39:54,602 --> 00:39:59,840
see the chef create it before your eyes. 
Or you get a, a cocktail and it's made. 

603
00:39:59,840 --> 00:40:02,241
Does that increase your liking of that as 
well? 

604
00:40:02,241 --> 00:40:04,843
 >> absolutely. 
So, so all of a sudden there's a, there's 

605
00:40:04,843 --> 00:40:08,158
a whole sort of other mean, meaning that 
you can attribute to it so, if you think 

606
00:40:08,158 --> 00:40:13,027
about a drink, a drink is a drink. 
You, even if you don't think about it, 

607
00:40:13,027 --> 00:40:17,010
there's no, nothing much to enjoy, you're 
just consuming it. 

608
00:40:17,010 --> 00:40:20,838
But anything that gets you to slow down, 
think about it, reflect on it, have some 

609
00:40:20,838 --> 00:40:24,434
extra voice in your head going over it, 
it is actually going to increase the 

610
00:40:24,434 --> 00:40:28,640
enjoyment of it. 
 >> Mm-hm. 

611
00:40:28,640 --> 00:40:32,380
Speaking of drinks one person wants to 
know, how you choose wine. 

612
00:40:32,380 --> 00:40:34,690
 >> How I choose wine? 
 >> Yes. 

613
00:40:34,690 --> 00:40:36,230
Do you drink wine? 
Do you like wine? 

614
00:40:36,230 --> 00:40:39,912
 >> I do drink wine, I like wine, I'm a, 
what you call a cheap date 

615
00:40:39,912 --> 00:40:42,145
 >> [LAUGH]. 
 >> I can usually drink about one, one 

616
00:40:42,145 --> 00:40:47,580
glass before I become slightly tipsy and 
a glass and a half and then it's over. 

617
00:40:47,580 --> 00:40:50,046
 >> It's true. 
 >> [LAUGH] how do I choose wine? 

618
00:40:50,046 --> 00:40:53,375
I am perfectly willing to accept the fact 
that I don't understand wine. 

619
00:40:53,375 --> 00:41:05,870
I I try to enjoy it never the less so I 
swirl, I smell. 

620
00:41:05,870 --> 00:41:09,209
I think that all of those things that 
slow people down are really good things 

621
00:41:09,209 --> 00:41:14,262
so I try to you know. 
I have know idea what tanning complexity 

622
00:41:14,262 --> 00:41:17,389
means but I use this thing I think to 
myself you know what's the acidity, 

623
00:41:17,389 --> 00:41:21,092
what's this? 
you know, I think you can enjoy tomato in 

624
00:41:21,092 --> 00:41:24,154
the same way, right? 
You can slow down and think about a 

625
00:41:24,154 --> 00:41:27,546
tomato and say what's the acidity, and 
the freshness, and the tartness and so 

626
00:41:27,546 --> 00:41:33,248
on. 
So I basically recognize my lack of 

627
00:41:33,248 --> 00:41:37,340
understanding of wine, at the same time I 
try not to consume it without thinking 

628
00:41:37,340 --> 00:41:42,760
about it, because I realize that thinking 
is going to be better. 

629
00:41:42,760 --> 00:41:48,060
Sometimes I choose wine that people have 
an interesting story about this. 

630
00:41:48,060 --> 00:41:52,710
so I went with a group of friend to a 
local restaurant and the waitress talked 

631
00:41:52,710 --> 00:41:56,678
about a particular wine that came from an 
island and she talked about how this 

632
00:41:56,678 --> 00:42:02,122
island, they also have. 
Lime is growing on that island and 

633
00:42:02,122 --> 00:42:06,755
because it's an island and with lime. 
There's a, the limeness actually get into 

634
00:42:06,755 --> 00:42:09,490
the wine. 
I think it's a crazy idea, the idea that 

635
00:42:09,490 --> 00:42:12,690
there are [LAUGH] lime trees on this 
island and because of that it somehow get 

636
00:42:12,690 --> 00:42:17,202
into the wine. 
I just can't imagine that there's any 

637
00:42:17,202 --> 00:42:22,580
molecule from a, from this line that 
entered that. 

638
00:42:22,580 --> 00:42:25,076
But, and you know what, and she had this 
story about an island and how, because 

639
00:42:25,076 --> 00:42:27,560
it's an island, she had some other crazy 
stuff. 

640
00:42:27,560 --> 00:42:32,064
but you know what, I enjoyed the story. 
So, I, I got that particular wine and I 

641
00:42:32,064 --> 00:42:36,430
can't imagine it's a real story, but 
here's a way to enjoy wine and think 

642
00:42:36,430 --> 00:42:41,684
about limeness and could I detect any 
lime and 

643
00:42:41,684 --> 00:42:42,771
 >> Now-- 
 >> Did you? 

644
00:42:42,771 --> 00:42:43,845
 >> No. 
 >> No. 

645
00:42:43,845 --> 00:42:47,150
 >> you know, it was, it was tart, 
interestingly it was tart. 

646
00:42:47,150 --> 00:42:51,350
And, and, and the island story, so, so I, 
I like, I like wines with strange 

647
00:42:51,350 --> 00:42:57,039
stories, partially because I get to think 
about them afterwards. 

648
00:42:57,039 --> 00:42:59,685
Otherwise if you just get Bordeaux, you 
know, they're all the same, nothing 

649
00:42:59,685 --> 00:43:02,530
against the French. 
But if you get Bordeaux, it's all the 

650
00:43:02,530 --> 00:43:06,850
same, there's not unique stories about 
the wine, you can't separate them. 

651
00:43:06,850 --> 00:43:09,860
But having a unique story about the wine 
from something, somewhere different, then 

652
00:43:09,860 --> 00:43:12,890
you get to think about it a little 
differently, I, I do. 

653
00:43:12,890 --> 00:43:16,402
So I. 
Cheap wine, relatively cheap, I don't, 

654
00:43:16,402 --> 00:43:20,335
have a particular reason to spend more, 
more money on it, because I don't really 

655
00:43:20,335 --> 00:43:24,133
think I understand much, with a good 
story. 

656
00:43:24,133 --> 00:43:26,142
 >> All right. 
 >> Those are my, 

657
00:43:26,142 --> 00:43:30,227
 >> And it, we actually hosted a 
wine-tasting with Bordeaux. 

658
00:43:30,227 --> 00:43:32,032
 >> Yes. 
 >> And at the time, we thought they 

659
00:43:32,032 --> 00:43:33,606
were very different. 
 >> Yes[LAUGH]. 

660
00:43:33,606 --> 00:43:40,010
 >> So, anyway, do you have any tips for 
motivating yourself? 

661
00:43:40,010 --> 00:43:44,216
How are you, presuming that you are so 
productive, how are you so productive? 

662
00:43:44,216 --> 00:43:50,996
 >> How am I, Productive. 
So, so I think part of the, the story is 

663
00:43:50,996 --> 00:43:54,520
trying to sleep very little and drink a 
lot of coffee. 

664
00:43:54,520 --> 00:44:00,158
That, that that really works. 
so, so I, I try to think about So, so, 

665
00:44:00,158 --> 00:44:06,918
the thing about, in general in social 
science, you know, we find lots of really 

666
00:44:06,918 --> 00:44:12,632
sad facts, right. 
We find the people are myopic and 

667
00:44:12,632 --> 00:44:16,480
vindictive and emotional when we find how 
people make mistakes all the time. 

668
00:44:16,480 --> 00:44:20,929
And in many ways, it's kind of sad 
realization. 

669
00:44:20,929 --> 00:44:24,490
I, I try to motivate myself about 
thinking how we can fix it. 

670
00:44:24,490 --> 00:44:28,760
So, my personal (no period) passion is to 
try and improve how things are and I keep 

671
00:44:28,760 --> 00:44:34,770
on thinking about all kinds of stuff in 
life, it's just a, just a human waste. 

672
00:44:34,770 --> 00:44:37,370
There's all kinds of things I just, wish 
they were different. 

673
00:44:37,370 --> 00:44:40,890
And I see my goal is kind of documenting 
and finding the things we're not doing 

674
00:44:40,890 --> 00:44:44,430
well, and then try to figure out how we 
fix it. 

675
00:44:44,430 --> 00:44:47,981
And From that perspective, I feel very 
connected with the, with the larger, with 

676
00:44:47,981 --> 00:44:51,522
the larger mission, right? 
So we have people doing all kinds of 

677
00:44:51,522 --> 00:44:55,131
wonderful things around the world. 
If we could only feed them with better 

678
00:44:55,131 --> 00:44:58,446
understanding of what they should be 
doing, they would, they would do a better 

679
00:44:58,446 --> 00:45:01,972
job. 
So think about the, the impassive system 

680
00:45:01,972 --> 00:45:06,130
in in Kenya this is a mobile payment 
system that lot's of people are doing and 

681
00:45:06,130 --> 00:45:10,099
we're hoping that many more people in 
rural dist, rural places could, could 

682
00:45:10,099 --> 00:45:15,690
start using them to empower them 
financially. 

683
00:45:15,690 --> 00:45:19,100
Right, if we only understood the 
psychology of money better could we build 

684
00:45:19,100 --> 00:45:22,360
better system like this. 
You think about health care system. 

685
00:45:22,360 --> 00:45:25,770
So I I see so many things being wrong and 
I think that if we understood each of 

686
00:45:25,770 --> 00:45:29,180
them a little bit better we could do 
better and that for me really motivates 

687
00:45:29,180 --> 00:45:33,836
me. 
So I guess the, the answer is that I see 

688
00:45:33,836 --> 00:45:39,670
a long term objective that is really 
promising. 

689
00:45:39,670 --> 00:45:43,328
And I can see how even small steps in 
that direction, I don't think we need to 

690
00:45:43,328 --> 00:45:47,390
solve healthcare. 
even small steps could, could improve, 

691
00:45:47,390 --> 00:45:51,096
improve lives. 
And then, does it, does a statement in, 

692
00:45:51,096 --> 00:45:57,012
in a Jewish tradition basically said. 
if you haev saved the single life which 

693
00:45:57,012 --> 00:46:01,548
is if youve saved the whole world and i 
try to think about that as well you know 

694
00:46:01,548 --> 00:46:06,156
theres a question of solving things and 
theres a question of improving and i i 

695
00:46:06,156 --> 00:46:10,692
think if you said can we solve global 
warming Tough, hard to get motivated by 

696
00:46:10,692 --> 00:46:17,593
that. 
Can we get people to behave slightly, 

697
00:46:17,593 --> 00:46:21,973
slightly better and, for me this 
perspective of trying to save one thing 

698
00:46:21,973 --> 00:46:26,572
so, I give lots of talks in hospitals, 
and, and my usual motivation is to say, 

699
00:46:26,572 --> 00:46:35,040
if I could only get one doctor to treat 
one patient better, that, that's a great 

700
00:46:35,040 --> 00:46:38,497
 >> accomplishments. 
So maybe I guess the, the answer is I 

701
00:46:38,497 --> 00:46:42,067
have low standards. 
I, I think, I think ev, I, I look at even 

702
00:46:42,067 --> 00:46:45,962
small steps as achievement and that 
really motivates me. 

703
00:46:45,962 --> 00:46:48,178
 >> Right, no. 
Taking one thing at a time I think 

704
00:46:48,178 --> 00:46:50,610
that's, I think that's a good way to do 
it. 

705
00:46:50,610 --> 00:46:54,474
so this, this next question I think you 
might have some important insights into 

706
00:46:54,474 --> 00:46:57,776
because you spend a lot of time 
traveling. 

707
00:46:57,776 --> 00:47:00,598
 >> Yes. 
 >> How can you maximize your time on an 

708
00:47:00,598 --> 00:47:05,148
airplane? 
 >> Ok, maximize. 

709
00:47:05,148 --> 00:47:06,700
[LAUGH] 
 >> You know all about airplanes. 

710
00:47:06,700 --> 00:47:11,191
 >> Yes, I know a lot about airplanes, 
and airports, and security lines. 

711
00:47:11,191 --> 00:47:15,840
So, so for a long time I would try to 
work on the airplanes. 

712
00:47:15,840 --> 00:47:21,610
And I actually thought having no internet 
connection was a. 

713
00:47:21,610 --> 00:47:25,846
Was a good environment. 
and I still think at the time when I was 

714
00:47:25,846 --> 00:47:31,138
not traveling that much, I would 
basically try to take a single task that 

715
00:47:31,138 --> 00:47:39,845
would take me about half of the time of 
the flight and try to focus on that. 

716
00:47:39,845 --> 00:47:42,821
for me it worked a little bit better to 
do it on paper than on the computer 

717
00:47:42,821 --> 00:47:45,970
because paper you could have out all the 
time. 

718
00:47:45,970 --> 00:47:49,309
The computer they tell you to close it 
and open it and then the person in front 

719
00:47:49,309 --> 00:47:53,040
of you leans back and so paper was 
helpful. 

720
00:47:54,140 --> 00:47:58,755
The other thing that is interesting about 
paper is that when you work just writing 

721
00:47:58,755 --> 00:48:03,840
or editing on paper I, I get a better 
sense of progress. 

722
00:48:03,840 --> 00:48:07,970
Actually,if you think about, in a bigger 
schema, I'm digressing for a second, but 

723
00:48:07,970 --> 00:48:11,805
if you think about it in a general way, 
if you write something and you just write 

724
00:48:11,805 --> 00:48:15,876
electronic documents, and let's say you 
edit in something 50 times, you get the 

725
00:48:15,876 --> 00:48:23,240
last version, and you say, why didn't I 
just write this one to start with? 

726
00:48:23,240 --> 00:48:25,550
but of course you couldn't have written 
that version to start with. 

727
00:48:25,550 --> 00:48:28,454
You wrote the first version, you edited 
it, understood it differently and so on 

728
00:48:28,454 --> 00:48:33,274
And the process was important. 
And I think in the days when people wrote 

729
00:48:33,274 --> 00:48:37,780
by hand, you would have kind of a trace 
of what you did. 

730
00:48:37,780 --> 00:48:40,404
We just lose the trace right now because 
we right on top of things, or we edit on 

731
00:48:40,404 --> 00:48:43,920
top of things. 
We don't see what we've learned. 

732
00:48:43,920 --> 00:48:46,180
We don't think what we've accumulated. 
I think it will be kind of interesting if 

733
00:48:46,180 --> 00:48:48,988
we. 
Try to write a word processor, that would 

734
00:48:48,988 --> 00:48:53,390
remind people about what they've learned 
throughout the, throughout the way. 

735
00:48:53,390 --> 00:48:56,060
Or think about all the editing you're 
doing, right? 

736
00:48:56,060 --> 00:48:59,010
How is a, what have you learned? 
What, what have you figured out? 

737
00:48:59,010 --> 00:49:02,970
And could we create a trace that helped 
you eh, understand all the steps you went 

738
00:49:02,970 --> 00:49:07,280
through and not just the final, the final 
eh, version? 

739
00:49:07,280 --> 00:49:11,438
So And so I think there is something 
useful about this sense of progress, and 

740
00:49:11,438 --> 00:49:15,407
understanding your own, process, of 
improving over time, and, and we lose a 

741
00:49:15,407 --> 00:49:21,474
lot of it in electronic editing. 
But, so working on paper for me, actually 

742
00:49:21,474 --> 00:49:24,829
give me a sense of A a essence of 
progress you get to go over a page and 

743
00:49:24,829 --> 00:49:28,611
you get the next page and see the numbers 
of the pages I know that electronic 

744
00:49:28,611 --> 00:49:35,678
documents have pages as well. 
It just doesn't give me the same and the 

745
00:49:35,678 --> 00:49:41,959
same sense so for me a printed an essence 
of progress is helpful. 

746
00:49:43,100 --> 00:49:47,490
Also because flights are basically 
unpleasant. 

747
00:49:47,490 --> 00:49:50,955
I think when I was a kid I enjoyed 
flying, but it, it, it, becomes 

748
00:49:50,955 --> 00:49:57,140
unpleasant very quickly and I, I try to 
also make sure I don't work all the time. 

749
00:49:57,140 --> 00:50:01,694
I try to do something fun, so Usually I 
download something on my iPad and I try 

750
00:50:01,694 --> 00:50:07,628
to make sure I work some of the time, and 
I watch some of the time. 

751
00:50:07,628 --> 00:50:14,150
Actually, the first flight I ever watched 
something on was a flight to China. 

752
00:50:14,150 --> 00:50:19,550
This was quite a few years ago and I 
downloaded a TV show called 24. 

753
00:50:19,550 --> 00:50:23,456
It was the first season, and it's a TV 
show that Suppose if it takes 24 hours in 

754
00:50:23,456 --> 00:50:27,424
the straight shots, but there some 
commercials of course so every hour takes 

755
00:50:27,424 --> 00:50:31,268
45 minutes or so and, and I started 
watching this and its, its, its, its fast 

756
00:50:31,268 --> 00:50:35,112
phase and every chapter ends and you 
really want to watch the next one so, on 

757
00:50:35,112 --> 00:50:41,932
TV I guess you have to wait a 
week[UNKNOWN] but 

758
00:50:41,932 --> 00:50:46,000
 >> [LAUGH] Not watching Netflix. 
 >> Not on Netflix. 

759
00:50:46,000 --> 00:50:49,712
And it was an amazing sight, because I 
would fall asleep, and you know, kind of 

760
00:50:49,712 --> 00:50:53,482
half waking up in the flight, not knowing 
exactly where I am, and my dreams were 

761
00:50:53,482 --> 00:50:57,194
connected of, all of these activities 
that happened in this series and where 

762
00:50:57,194 --> 00:51:03,922
was I, and I, you know, confusing, 
really, really long flight confusing 

763
00:51:03,922 --> 00:51:07,344
 >> Which was an amazing emotional 
activity, where, where my whole flight 

764
00:51:07,344 --> 00:51:11,230
was consumed with this experience of a 
new, strange place, partially sleeping, 

765
00:51:11,230 --> 00:51:15,174
partially not, dreaming about this ex- -- 
it was really a very disturbing but very 

766
00:51:15,174 --> 00:51:20,940
magical way to experience a flight. 
 >> So you felt like you were right 

767
00:51:20,940 --> 00:51:23,145
there with Jack Bauer -- 
 >> I, I felt, I felt I was -- 

768
00:51:23,145 --> 00:51:25,327
 >> -- fighting crime? 
 >> Some worry that in that arena 

769
00:51:25,327 --> 00:51:28,072
experience, seeing something strange as 
well. 

770
00:51:28,072 --> 00:51:30,520
 >> Interesting. 
Alright. 

771
00:51:30,520 --> 00:51:34,450
can you speak about using gamification in 
the workplace? 

772
00:51:34,450 --> 00:51:37,929
Do you see the pros and cons of this and, 
you know --? 

773
00:51:37,929 --> 00:51:44,348
 >> Gamification is a very nice Term. 
[UNKNOWN] is the way that computer gamers 

774
00:51:44,348 --> 00:51:47,923
look at human behavior, and computer 
gamers basically have to take something 

775
00:51:47,923 --> 00:51:53,360
like playing the computer and get people 
to do it or hours with no pay, right? 

776
00:51:53,360 --> 00:51:57,064
That's their task. 
And they're basically rediscovering lots 

777
00:51:57,064 --> 00:52:01,672
of principles from psychology, so, things 
like random reward or accumulating points 

778
00:52:01,672 --> 00:52:06,200
or feeling of progress, competition, and 
so on. 

779
00:52:06,200 --> 00:52:10,988
And if you think about that it's 
basically tapping all the other aspects 

780
00:52:10,988 --> 00:52:16,343
of human motivation that have nothing to 
do with money. 

781
00:52:16,343 --> 00:52:20,151
And right now we have games that have 
gamification but the amount of 

782
00:52:20,151 --> 00:52:24,090
gamification in daily life is not that 
high. 

783
00:52:24,090 --> 00:52:27,390
And I think there's huge potential to 
actually increase gamification in daily 

784
00:52:27,390 --> 00:52:29,980
life. 
So, we're doing it in some ways. 

785
00:52:29,980 --> 00:52:32,832
So, you can have a wristband that's 
measuring how much you walk, and you can 

786
00:52:32,832 --> 00:52:36,170
do. 
A competition based on that but I think 

787
00:52:36,170 --> 00:52:40,395
there is a tremendous potential for 
adding other aspects of human motivation 

788
00:52:40,395 --> 00:52:44,035
in to the workplace that are not as 
easily, have not been this easily 

789
00:52:44,035 --> 00:52:51,350
measurable displayed and compare so the 
key to gamificaftion . 

790
00:52:51,350 --> 00:52:54,310
Is to get fast reward for all kinds of 
things you're doing. 

791
00:52:54,310 --> 00:52:57,370
To get a sense of progress, to compare 
things to others. 

792
00:52:57,370 --> 00:53:00,475
I think there's lots of eh, potential 
benefits there. 

793
00:53:00,475 --> 00:53:04,999
Eh, the, the downside that I think could 
happen is how do we think about 

794
00:53:04,999 --> 00:53:09,590
competition. 
So, one of the things we know about. 

795
00:53:09,590 --> 00:53:13,088
One of the best ways to improve education 
is to get the good teacher in the school 

796
00:53:13,088 --> 00:53:20,270
to teach the not so good teacher. 
One model of teachers is just to say the 

797
00:53:20,270 --> 00:53:26,550
bad teachers are lazy. 
Another model of teaching is the bad 

798
00:53:26,550 --> 00:53:29,920
teachers, or the not so good teachers 
have not figured out how to teach well. 

799
00:53:29,920 --> 00:53:33,092
So if you take the good teachers, you can 
get them to impart their skill and 

800
00:53:33,092 --> 00:53:36,472
knowledge and, and tricks, and tho-, 
those people who haven't figured out for 

801
00:53:36,472 --> 00:53:40,470
themselves can actually become better 
teachers. 

802
00:53:40,470 --> 00:53:45,660
And there's a risk that some ramification 
is going to eliminate collaboration. 

803
00:53:45,660 --> 00:53:49,730
So, when we do Gamification. 
There's a question of how do we view the 

804
00:53:49,730 --> 00:53:54,650
role of the individual versus the group? 
And I think there are many cases in 

805
00:53:54,650 --> 00:53:59,550
which, for example having individual 
scores could decrease collaboration and 

806
00:53:59,550 --> 00:54:04,515
help between people. 
So when we think about gamification we 

807
00:54:04,515 --> 00:54:08,762
need to be very careful to create the 
right incentive to get the. 

808
00:54:08,762 --> 00:54:12,880
A, a right, right outcome, and, 
because[INAUDIBLE] in general would 

809
00:54:12,880 --> 00:54:17,424
measure many more things, in, in the work 
place, eh, the risk of moving to this 

810
00:54:17,424 --> 00:54:23,814
quantified approach, eh, is very risky 
 >> I mean the, the, the risk it will 

811
00:54:23,814 --> 00:54:28,429
measure the wrong things, and motivate 
bad behavior is very high, so we need to 

812
00:54:28,429 --> 00:54:34,705
think about it much better. 
when we think about incomplete contracts, 

813
00:54:34,705 --> 00:54:39,774
for example say you work for me, you. 
 >> In this hypothetical world. 

814
00:54:39,774 --> 00:54:43,480
 >> In this hypothetical world. 
You basically know what are the kind of 

815
00:54:43,480 --> 00:54:45,840
things that will be good for the lab, 
right? 

816
00:54:45,840 --> 00:54:49,525
And you're going to do them, but But if I 
start gamifying part of your behavior and 

817
00:54:49,525 --> 00:54:53,155
not others, it, it could have the aspect 
as, as money, in which you're just going 

818
00:54:53,155 --> 00:54:57,700
to pay attention to some things and not 
others. 

819
00:54:57,700 --> 00:55:01,396
So whenever, whether it's money and so 
on, we, we talked about in the psychology 

820
00:55:01,396 --> 00:55:04,980
of money where, where, where you create 
some specific incentives you have to 

821
00:55:04,980 --> 00:55:10,736
worry about eliminating the overall 
 >> goodwill toward the workplace. 

822
00:55:10,736 --> 00:55:14,560
 >> Right, right, right. 
Okay, I have one more question for you. 

823
00:55:14,560 --> 00:55:17,590
 >> One more question. 
 >> And it is, can you explain the magic 

824
00:55:17,590 --> 00:55:21,478
behind prices ending in nine? 
 >> The magic? 

825
00:55:21,478 --> 00:55:23,519
Did I ever show you my magic trick, by 
the way? 

826
00:55:23,519 --> 00:55:26,413
With the cards? 
possibly 

827
00:55:26,413 --> 00:55:29,140
 >> i have a wonderful magic trick 
 >> want to do it now[LAUGH] 

828
00:55:29,140 --> 00:55:34,750
 >> maybe next time 
 >> someone get the cards next time 

829
00:55:34,750 --> 00:55:40,972
 >> next time so the magic with 9 so the 
ending of 9 is actually a big mystery and 

830
00:55:40,972 --> 00:55:48,610
theres lots of thoughts about where this 
came from. 

831
00:55:48,610 --> 00:55:53,550
Originally in the US, the 9 ending were 
for accounting purposes. 

832
00:55:53,550 --> 00:55:57,302
So, there were no computers and there was 
a question of how long have items been on 

833
00:55:57,302 --> 00:56:02,260
display when it's time to switch them? 
And they would basically use the last 

834
00:56:02,260 --> 00:56:06,690
digit as an indicator of how long 
something has been on the floor? 

835
00:56:06,690 --> 00:56:10,071
So imagine that something in their when 
new items come in, they end with zero and 

836
00:56:10,071 --> 00:56:14,760
then a month, a week or two later, we put 
one and then two and three and so. 

837
00:56:14,760 --> 00:56:19,635
And nine actually used to be the number 
that was, okay, just before we get rid of 

838
00:56:19,635 --> 00:56:25,410
that, but in the prices went, went down 
as well. 

839
00:56:25,410 --> 00:56:30,190
So, in that time there was actually a 
reason In infer something about nine. 

840
00:56:30,190 --> 00:56:33,272
Nine meant something as being around for 
a long time, there's a good chance being 

841
00:56:33,272 --> 00:56:36,124
discounted from the time that it first 
comes on the floor, before it's it's 

842
00:56:36,124 --> 00:56:41,255
living up. 
this is no longer necessarily the case. 

843
00:56:41,255 --> 00:56:47,080
But somehow this perception of nine as 
being eh, on discount, is is increased. 

844
00:56:47,080 --> 00:56:51,140
And there's some really nice Research on 
that and there's some papers looking at 

845
00:56:51,140 --> 00:56:54,968
catalogues and what they show is that of 
there's one item endign in nine, people 

846
00:56:54,968 --> 00:56:58,738
say, "This must be on a discount", and by 
the way, prople buy that item more even 

847
00:56:58,738 --> 00:57:02,392
if the price increases from about, 
increasing let's say from $44 to $59.99, 

848
00:57:02,392 --> 00:57:05,930
so the price could increase but if 
there's one item like this, people say, 

849
00:57:05,930 --> 00:57:14,540
"This must be on discount, it's such a 
unique different price." 

850
00:57:14,540 --> 00:57:18,860
But if the whole catalog ends in 9, now 
there's no signaling value for this. 

851
00:57:18,860 --> 00:57:24,040
So, so one thing is about what people 
think that the 9 ending signals. 

852
00:57:24,040 --> 00:57:27,568
And people think, kind of somehow 
intuitively, I'm not sure it's because of 

853
00:57:27,568 --> 00:57:31,208
history, I'm not sure if the history, the 
reason they use 9 was because that was 

854
00:57:31,208 --> 00:57:36,808
the natural way people interpret price, 
but there's something about the 

855
00:57:36,808 --> 00:57:40,416
 >> This 9 is a special deal. 
and the other possibility, and there's 

856
00:57:40,416 --> 00:57:45,390
some evidence for that, is that people 
just don't count it correctly. 

857
00:57:45,390 --> 00:57:49,688
So 1.99 is a, is a, is 2 -- 
 >> Almost. 

858
00:57:49,688 --> 00:57:53,690
 >> --[INAUDIBLE] but it's almost 2. 
So what happens when we have 50 items 

859
00:57:53,690 --> 00:57:56,920
that are each 1.99? 
How do we count that? 

860
00:57:56,920 --> 00:58:00,090
correctly. 
And we did a little study we asked some 

861
00:58:00,090 --> 00:58:03,976
undergrads to go to a few of the grocery 
stores around here, and we asked people 

862
00:58:03,976 --> 00:58:07,688
as they ring things through the cashier 
to how how okay big do you think your 

863
00:58:07,688 --> 00:58:13,070
basket is? 
And in terms that people think their 

864
00:58:13,070 --> 00:58:16,515
basket is less, I mean we basically found 
this big effect people under estumae 

865
00:58:16,515 --> 00:58:20,066
They, their basket and even the cashiers 
were expert in this, underestimate the 

866
00:58:20,066 --> 00:58:24,605
basket. 
And and I thin it's because we count the 

867
00:58:24,605 --> 00:58:29,750
dollars a lot and we kind of don't really 
count the cents so much. 

868
00:58:29,750 --> 00:58:34,090
This is the strongest with 1.99 compared 
to 1.77 and so on, so we lose some of 

869
00:58:34,090 --> 00:58:37,710
this. 
So I think both of those things happen, 

870
00:58:37,710 --> 00:58:41,805
there's a singling element 
 >> And then on top of that, there's 

871
00:58:41,805 --> 00:58:45,988
this discounting or lack of counting 
element as well. 

872
00:58:45,988 --> 00:58:48,296
 >> All right. 
Thank you, Dan. 

873
00:58:48,296 --> 00:58:50,255
 >> My pleasure. 
 >> And thanks for watching. 

874
00:58:50,255 --> 00:59:06,449
Bye-bye. 
[NOISE] Alright we found some cards. 

875
00:59:06,449 --> 00:59:18,385
So Dan is going to show you guys his card 
trick. 

876
00:59:18,385 --> 00:59:24,740
Okay, so, I've, I've three cards. 
Okay? 

877
00:59:26,020 --> 00:59:29,860
And I'm going to give you this pencil, 
and I'm going to ask you to start tapping 

878
00:59:29,860 --> 00:59:33,840
these, okay? 
Just tap them gently. 

879
00:59:35,990 --> 00:59:39,558
Slowly. 
And what I'm going to do is I'm going to 

880
00:59:39,558 --> 00:59:42,346
focus 
 >> And I'm going to transmit to you 

881
00:59:42,346 --> 00:59:46,630
with my thought, in terms of where I want 
you to stop. 

882
00:59:48,050 --> 00:59:49,820
Okay? 
So I'm starting. 

883
00:59:49,820 --> 00:59:52,000
 >> And your eyes are closed. 
 >> My eye, that doesn't matter. 

884
00:59:52,000 --> 00:59:55,322
I'm transmitting here. 
When you feel like I've told you which 

885
00:59:55,322 --> 00:59:59,232
one to stop, stop on one of them. 
Are you sure? 

886
00:59:59,232 --> 01:00:02,044
Absolutely sure? 
 >> Perfectly sure. 

887
01:00:02,044 --> 01:00:03,730
 >> Yes. 
 >> Did you, Did I tell you anything at 

888
01:00:03,730 --> 01:00:05,000
the start about this? 
 >> No. 

889
01:00:05,000 --> 01:00:06,566
 >> Is this by your own accord? 
 >> Yes. 

890
01:00:06,566 --> 01:00:08,396
 >> Yes. 
You feel like you decided. 

891
01:00:08,396 --> 01:00:11,254
 >> I did decide. 
 >> You see this brown envelope? 

892
01:00:11,254 --> 01:00:12,971
 >> Uh-huh. 
 >> Please open it. 

893
01:00:12,971 --> 01:00:15,545
 >> It's a manila envelope, but I will 
open it. 

894
01:00:15,545 --> 01:00:21,734
 >> Okay, and what does it say? 
 >> What?! 

895
01:00:21,734 --> 01:00:24,202
 >> Show it to the camera, what did it 
say? 

896
01:00:24,202 --> 01:00:26,100
 >> Stop. 
 >> Show it to the camera, what did it 

897
01:00:26,100 --> 01:00:32,395
say? 
 >> How did I do it? 

898
01:00:32,395 --> 01:00:37,740
 >> Well, I'm actually not sure. 
[LAUGH] 

899
01:00:37,740 --> 01:00:42,075
 >> This is, this is, this is the trick. 
Isn't it good? 

900
01:00:42,075 --> 01:00:46,790
 >> Can we do it again? 
[LAUGH] This is my favorite magic trick 

901
01:00:46,790 --> 01:00:48,882
by the way. 
Are you impressed? 

902
01:00:48,882 --> 01:00:56,530
 >> I'm kind of annoyed. 
[LAUGH] OK, yes, I'm impressed. 

903
01:00:56,530 --> 01:00:58,520
 >> Very good. 
Thank you very much.