(a) "Unwillingness to learn particular from general matched by willingness to learn general from particular"

• Hence, planning fallacy (i.e. overoptimism on horizon without accounting for the base rate in the reference category)

(b) "Unlimited ability to ignore our own ignorance"

• Hindsight bias: Change past belief
• Outcome bias: Change past belief based on intensity of known outcome

(c) "Assertion of high confidence suggests person has conducted a cohesive story, not necessarily that the story is true."

(d) Prospect Theory

• Reference points (relative gain or loss)
• Diminishing sensitivity
• Loss aversion

In mixed outcome, we are risk averse

In bad outcome, we are risk seeking because of loss aversion

(e) Endowment effect

• Gap between minimum selling price and max buying price
• Good purchased for exchange versus for use

(f) Other nuances of human behaviour:

• Possibility effect: over index on small probabilities
• Certainty effect: under index on large probabilities
• Give priority to bad news