This week an article I was reading on Unherd by Stuart Ritchie, a psychologist colleague and lecturer at KCL I deeply respect (1). It threw into sharp relief why I don’t post about behavioural psychology. When I first took up this blog I expected to get into behavioural economics in a big way. I wanted to post all about the behavioural biases that we, as investors, succumb to. Rather like the Psy-Fi blog (2). The psychological traps that we fall into, that also branch into my daily working trade.
In researching these concepts to write about I come against a major problem. The evidence is pretty poor. At face value the biases make a lot of sense (ergo strong face validity), but many suffer from the flaws that Dr Ritchie outlines as reasons why behavioural insights and psychology don’t apply to the current COVID-19 pandemic. Alot of this comes down to the “replication crisis” that has occurred over the past decade. This has shown that many of the best known psychological results couldn’t be repeated in independent experiments. At best these studies were one-offs, they could have been selective, biased or misreported, and at worst they may be fraudulent.
Dr Ritchie goes on to outline a number of cases where psychologists have given opinions on the current COVID-19. A lot of those opinions are based on studies produced with small numbers of university students in idealised conditions. We’re now accepting they are not generalisable to Jo Bloggs on the street:
“So how can we be sure that the results of behavioural science experiments — even those that are based on bigger or more representative samples than 156 undergrads — are relevant to our current situation?
The answer is that we can’t. Exploring the human capacity for bias and irrationality can make for quirky, thought-provoking articles and books that make readers feel smarter (and can build towards a tentative scientific understanding of how the mind works). But when a truly dangerous disease comes along, relying on small-scale lab experiments and behavioural-economic studies results in dreadful misfires…” (1)
The problem for behavioural economics, much like COVID-19, is one of data. We have not done enough pragmatic experiments to prove that the biases talked about have the effect we say they do (in most cases). In the absence of that data expert opinion rules. COVID-19 policy is being produced by experts, using what little data they have plus a lifetime of training. Some of it will be wrong. It will be biased by whatever preconceptions those experts have. The effects of those biases are unknown. The snake eats it’s own tail.
Image Credit: Dale Hattis (3)
For COVID-19 most of what those experts have been saying is common sense. Some of it hasn’t been; David Halpern of The Behavioural Insights Team, the “Nudge Unit”, coined the phrase “herd immunity” (4). Look how that turned out. Was he, as a behavioural psychologist, the right person to be speaking as an expert on public health and infectious diseases? See how fast we have backtracked to WHO guidance. Guidance from public health experts and limited data.
In the absence of data we have expert opinion. Experts don’t want to go on record in case they what they say is wrong, and people die (for COVID-19) or lose money (for behavioural economics). In the absence of expert opinion we have a vacuum, filled by all the other opinions the unqualified and slightly informed want to share, air and discuss. 24-hour news and social media have only heightened the problem. They offer platforms for partial truths. They amplify opinion.
I went through a phase of listening to loads of behavioural psychology talks and podcasts. They just made me angry. The information was sold as true fact. The face validity was there. There was benefit in challenging one’s own preconceptions and points of view. But where was the evidence to back up the fact claim?
I try to keep this blog evidence-based. As a doctor and a scientist I’ll only share information on COVID-19 that I think is responsible, balanced and evidence-based. I’ll only share information on behavioural psychology that I think is responsible, balanced and evidence-based. As with all science, the eternal cop-out, more data is required.
Keep handwashing, stay home and take care!
Thought for the week:
“There is only one way to happiness and that is to cease worrying about things which are beyond the power of our will.” – Epictetus
This twitter thread from David Oliver is excellent…
- Lockdown in the UK has mirrored Italy and China in leading to falls in air pollution (5) – I’ve enjoyed the new views on my daily commute
- Which could be the biggest fall in emissions since WW2 (6)
- While Trump has used the excuse to relax pollution laws in the US (7)
- Everyone is using Zoom, it’s founder is now richer, what are the issues? (8) – We’re not using it in my branch of the NHS due to security concerns
- While Skype have launched a no log-in service (9)
- Offered emergency food parcels aren’t being used (10)
- Telegraph article explaining what the R0 value actually is (11)
- And Private Eye have an excellent, cynical take on the whole shebang (12)
Life goes on:
- Cool developments in neuroscience, with the ability to turn brain activity directly to text (13)
- This is Money have a long post about a new cashback comparison service for mortgages (14)
- Weenie has her March financial updates from lockdown (15)
- TI at Monevator has a wide-ranging post covering the impact and effect of recent changes, with moderation and sense (16)
- And MMM similarly weighs in, though in a typically irreverent manner (17)
- Dr Fire has a quarterly update (18)
- Mr and Miss Way have their March figures (19)
- And think through the opportunities of the current situation (20)
- Savings Ninja also have his March financial update (21)
- As does FI UK Money (22)
- While Igniting Fire has a Q1 update (23)
- Pursue FIRE has a March update (24)
- As does One Million Journey (25)
- Obvious Investor has their P2P results for March – a very different perspective (26)
- SparkleBee has their March result (27)
- As does FIRE Lifestyle (28)
- And Ad Otium (29)
- And The Squirreler (30)
- And Monethalia (31)
- The Fire Starter has finished working for ‘the man’ (32) – Congratulations!
- Average Money Man has an update to their FreeTrade diary (33)
- The Psy-Fi blog mentioned above has a great analogy for the stock market in the K-Pg extinction (34)
- Finumus extends the shelter in place advice (35)
- Much More With Less has an interesting posts comparing their results with Vanguard and a robo-advisor (36)
- TEA has his latest NOW 20 collection (37)
- The Ermine is looking setting up a plan for profiting in this market (38)
- South Wales FI compares LISAs and SIPPs (39)
- And Indeedably has answered Saving Ninja’s call (before its gone out) with the positives he’s found during this difficult time (40)
It’s interesting to note that when I started this blog, the number of UK FIRE bloggers could be counted on fingers and toes. Now we’re up to the hundreds. Where blogs are repeating previous messages I won’t share them, unless they have a particularly eloquent or amusing take. I’m drafting up an RSS feed which I will inset into the website in the future.