Intelligence and rational thinking are not the same

I’ve long been convinced that raw intelligence as measured by IQ is not reliable predictor of effectiveness at work. I’ve seen too many ‘clever’ people who are ineffective. Some of the time it’s down to personality – people have the right answer but can’t bring their team or company with them – but even allowing for that, supposedly smart people make bad decisions a surprising amount of the time.

This interview with Keith E. Stanovich, Professor of Human Development and Applied Psychology at the University of Toronto, goes a long way to explaining why. It turns out that the ability to think rationally is at least somewhat independent of IQ. Thinking rationally can be boiled down to avoiding cognitive biases and many IQ smart people simply can’t do that. Here is a list of the common cognitive biases to watch out for:

  • The tendency to show incoherent probability assessments
  • The tendency toward overconfidence in knowledge judgments
  • The tendency to ignore base-rates [a.k.a. the base rate fallacy; sometimes we don’t take new information into account when making probability assessments]
  • The tendency not to seek to falsify hypotheses
  • The tendency to try to explain chance events
  • The tendency toward self-serving personal judgments
  • The tendency to evaluate evidence with a myside bias [where we only seek out perspectives that are sympathetic to our own]
  • The tendency to ignore the alternative hypothesis
  • The tendency to substitute affect for difficult evaluations [sometimes when we have to answer a difficult question we actually answer a related but different question without realizing a substitution has taken place]
  • The tendency to over-weight short-term rewards at the expense of long-term well-being [which is also referred to as the current moment bias]
  • The tendency to have choices affected by vivid stimuli [e.g. men have been shown to make poor decisions in the presence of an attractive female]
  • The tendency for decisions to be affected by irrelevant context

The good news is that by being aware of our cognitive biases we can learn to think more rationally. Over my career I’ve learned to be more rational and make better decisions by more actively  seeking information that falsifies my hypotheses by being more accepting of alternative hypotheses, and I don’t think I’m done yet.

Stanovich thinks that like IQ rational thinking is part learnable and part innate. That makes sense to me.

  • Richard Kelly

    I think since big data analytics has become more accessible and more widespread – if not trending its way into every executive’s life – that business decisions are now made by digital rational thinking. Information is used to shape decisions like never before, which is brilliant because it means that if your role is to make decisions on a daily basis, then you have more confidence in your actions.

    Well, unless you were hired to be the person who makes the business decisions, which in that case, you may have just been replaced by your bosses laptop.

  • Data is definitely helping us make more rational decisions, but I’m constantly surprised by people whose data analysis is driven by the biases I list above.

  • Richard Kelly

    It is definitely the quality of the data that matters most. We may create 2.5 quintillion bytes of data every day, but not all of it is quality and useful.