Rory Sutherland gave this interesting speech at TEDxOxford. It doesn’t seem to have a common thread which builds up to a conclusion or supports and overall point, but the general thread is about human decision making and its associated irrationality. Sutherland doesn’t pull punches, and he has strong opinions. Here are a few of his thoughts:
- On football (soccer if you’re american) – Succumbs to narrative bias and tribalism, statistically impure, results are mostly random and more decided by the coin toss at the beginning of the game than anything that goes on within it.
- On economics – Constructs impressive looking but flawed mathematical models based on incorrect premises.
- On wine – An atrocious drink that breaks the rule of successful consumer products. You wouldn’t go to a pub where every third beer tasted like piss, yet you’ll happily pay £4.50 for a glass of wine with a just over 50/50 chance of it tasting good.
You can see the thread running through these points — if we were rational, the worlds most popular sport perhaps wouldn’t be so unpredictable, and the highest status drink would be the one with the highest consistency in quality, not the least. Yet we do find value in unpredictability, a point to which I feel Sutherland doesn’t give due credit in this talk.
The fact that anything can happen in a game of football is what makes it a better game for the underdog, it puts that hope into the game. Although, I might have to check his premises on what he said about the game (upsets happen, but the richer team has always tended to win). Likewise, the utility in wine isn’t just in the taste, it’s in showing off how much you know about it and talking about how fruity (etc) it is.
It reminds me of the idea that the lottery is pointless, because you’re not going to win. That is true — you’re not going to win. But the value of buying a lottery ticket isn’t just in the prize, it’s also in the anticipation, the ritual of checking the numbers, the dreaming.
Sutherland gives some interesting views on other topics too, like path dependency in supermarkets, why the English are so poor at learning a second language, and why things are harder to change on a collective as opposed to individual level.
Overall it’s a pretty thought provoking talk and definitely recommended to any football-loving wine-drinking economists that might be reading this!
If you liked that, here’s Rory’s book, the Wiki Man.