.webp "The secret behind making financial decisions: How does money control us? \"Narrative\"")
"And now we're trying the second restaurant
to determine the best sandwich !
and judge, is it cool or cruel?
Come closer, Khaled,
Zoom in on the smoking' fries!
-Zoom in, Khaled, what's wrong?
-What's with the fries?
They're just dry and sad fries
like any other fries that we order
with hydrogenated fat food
that we eat everyday.
What? It's what we do for living!
And, didn't we agree that we don't say
the fries or dry or that anything is bad?
What do we say instead? Remember?
That it's not the best.
And when the meat is overcooked
and burnt, what do we say?
That it's not my preference,
but others might like it.
Bravo, now keep going.
Wow, their buns are different,
-there's some freshness or juiciness...
-That's fresh?
It tastes either chicken or hen.
Oh the cheese, let's talk about it!
What's this yellow thing? Not cheese!
The dressing tastes great
bu it feels familiar...
Let me work!
My overall rating,
is that the sandwich is superb,
the patty itself is amazing,
the delivery guy was so great and polite,
respectable, knows when to talk and smile.
You might ask me;
Shiko, do we get this sandwich?
I'm telling you, of course!
If I'm stranded in the desert and it's
the only option, I still wouldn't eat it.
An amazing experience,
just a bite takes you to another world.
You didn't even afford the sandwich,
you'll afford what will happen to people?
Just like you saw, the sandwich is great.
The guy is even coughing
because he ate too fast.
Thank you, and I hope
you try the sandwich yourself!
And go to a better place...
See you in another episode...Bye!
Help me, Shiko, I'm dying."
"Hello, my dear ,
welcome to an old Narrative.
See the trick I did?
Actually, it's a new episode.
Imagine this normal situation,
You're buying something
from Uncle Saeed the grocer,
and as a kid with a wondering mind
you say, "The grocer is so lucky,
he must be eating his goods for free!"
Anyway, you pick out your things
and go up to the man,
and tell him you want
to pay for your things.
So he packs your things, you give him
the money, and then time for the change,
when he says, "I don't have
quarters for the change"
"Take some gum for it"
Then you say, "Alright I'll take them".
So far so good?
No, my friend, not good.
Beware my friend, it may seem
like a normal daily thing,
but it's something we need to
stop and look at.
This simple gesture hides
more complexity than it seems,
between interactions and behaviors...
Really, Abo Hmeed?
It has manifestations
of sides of the human soul.
The human soul has sides too?
Humanity has sides, the soul won't?
Sides that you may not
have known about yourself.
It's time now
to uncover the mystery and thrill.
My dear friend, let's play a game
with two randomly-named characters,
Gamal and Waleed.
We'll tell them
that we'll give them 10 pounds to split,
but with a condition, that Waleed will be
the one splitting these 10 pounds.
And he's free
to either split them equally,
he takes five and Mr.Gamal does too,
or it's divided 6:4,
he takes 6 and Gamal 4.
or 7:3 or 9:1.
He's free... But there's a trick,
What's that?
That the other party
has to approve the split.
or else the money will be withdrawn.
This is called the Ultimatum Game,"
"If Gamal didn’t approve of
Waleed's splitting idea,
then there will be no money for either.
This is one of the most famous
experiments in Behavioral Economics,
called the Ultimatum Game,
or the warning game.
Actually, I find its results interesting...
Abo Hmeed, you see everything as interest.
Wow, your interest is always on fire.
Nothing I can do.
The Behavioral economics scientists
performed this experiment on many others
not just the US,
but many places around the world.
They found that in most cases,
Waleed says he'll split the money 50%,
so each one of them takes 5 pounds,
and Gamal approved.
But the question is,
what happens to the other cases?
If Waleed is greedy
and decided he wants it all,
in a way that makes him take
more than Gamal does.
"I'll take 7, and Gamal takes 3"
Scientists found something strange,
and I’ll tell you why later.
They found that the other party refuses.
Gamal here says "it's neither me or him!"
Man, you're wasting 3 pounds
that you'd have earned by now.
"Sorry, Waleed doesn't take the 7>"
This is still strange, my friend,
If we looked at it
with a logical and economic mind,
we'll see that Gamal
should have approved of anything.
Three is better than zero.
Two is better than zero.
Even one is better than zero.
The normal economists see this is illogical,
but the behavioral economists see that
as much as it may be illogical,
but it can be explained through
more complex factors;
illogical factors regarding win and loss,
somethings like justice,
oppression, and revenge.
Many behavioral economists
depend on this simple experiment,
to tell the economists that
not always in the world
do our decisions need to be solely logical.
No, there are many factors
that determine how we make decisions.
If you thought about it deeply,
you'll find that revenge is illogical."
"Why would I avenge from someone?
Why not live my life,
and I'm happy and he's happy?
During a time, economics was based on
a group of ideas about man himself.
And what, Abo Hmeed, the base fell?
Economics believed that humans
are logical creatures,
and are moved by mind and logic,
and guess what else?
Before making any decision,
we calculate pros and cons,
and decide based on that intel.
They said that human's decisions
were based on this method.
But after a while and after more
knowledge of the human being,
it turns out man does weird things,
that sometimes don't have direct benefits,
on the contrary,
they can harm him sometimes
and he knows that but still does it anyway.
That's when behavioral economics
took a stand,
and said that humans aren't that logical
and neither are their decisions.
But it's important to note,
that behavioral economics isn't
here to rewrite traditional economics.
They're not jealous of each other.
It just tells us that humans often do
behave in an illogical way,
that sometimes they don't even
understand why they’re doing it.
Let me tell you, a famous study says
that the extent of us enjoying something,
sometimes increases when we know
that it is expensive,
even if it actually has less value.
My friend, If I came up and told you,
this is a sandwich of fresh beans,
and the sandwich costs 100 dollars,
you'll say, "Oh that's the perfect
breakfast, I'm buying quality...
oriental breakfast is the best!"
But if I said that it's fresh
beans from Mahmoud el-Talangy
and the sandwich is 2.5 USD,
you'll say it's not good,
and the 100-dollar sandwich is better value
even though it's the same food.
This is because, in most times, we link
between the high price and the good's value.
This goodie is expensive for a reason.
Let's move from Uncle Saeed the grocer
and into a bigger place."
"Hypermarket! a huge shopping
mall with shelves of all life's goods,
and many departments, each with a specific
collection of goods,
that's when we see a phenomenon
familiar to every husband,
the phenomenon of toilet paper roll.
The wife tells him she would just
go get toilet paper and be right back,
and she knows exactly what she wants.
The couple go in innocently
to just buy toilet paper,
but end up checking out with 6 bags,
with stuff you weren't going to buy;
things you might already have at home,
or things you don't even need.
You went in for a toilet paper
and got out with the entire bathroom.
One of the famous examples
for this idea is IKEA stores.
IKEA is a Swedish furniture store,
founded by the Swedish
businessman, Ingvar Kamprad,
It was at first a normal furniture supplier
with average-priced products,
over time, IKEA turned into one of the most
important furniture chain-stores worldwide.
It has over 400 branches all over the world.
In 2016, IKEA's revenues
were 41 billion dollars!
The US dollar!
Can you imagine the value of it?
But what does this have to do with buying
toilet paper and ketchup from a hyper?
IKEA's success wasn't only based
on the quality of the products,
or that it's the best furniture
designer in the world.
Its success was based on small details
in the place's design and decor itself;
details that make the shopping experience
more fun and enjoyable,
hence making you want to buy more.
It's a big deal.
One of the famous studies in 1967,
say that half of the goods
we buy from any place
are things we decided
to buy while being there.
You could be just going for milk,
but then say "Oh, smoked tomato sauce!...
aged for 3 years, it's my favorite sauce,
I want to get it!"
This also applies to IKEA,
but with some additions.
The design of the place itself,
it's not just a vast space
where you walk around and leave.
No, it's designed to look like a maze,"
"No, it's designed to look like a maze,
and lucky you, customer, the maze has a map,
and to exit this maze
you have to walk in the pre-designed path made for you.
The designer is so gentle.
Then you discover that as you're taking the
path's directions, you don't exit the maze
it's a one direction,
you have a history and night changes.
As you're trying to exit the maze,
you're strolling into every department there,
and see almost everything, then the odds
of you buying things increases.
The second special thing there,
is having an acceptable
quality and price restaurant,
with meals that suit all family members,
and coffee too,
if you're tired from walking
and need to freshen up.
You know what it turned into?
it's no longer a shopping outing
to buy something and go home,
it's now a trip.
Being a trip simply means
you'll buy many things,
walk around, sit down, eat, and rest,
drink and go back,
as you're walking in the maze, you remember
something in the back to look at,
so you go back and go around again.
On your way to the cashier to checkout,
you pray that your money is enough,
then you see two shelves on both your sides...
"Enough, please"
These shelves have things
from departments you already passed by,
some of them you may have seen before,
but got hesitated
and said you'll get it later.
Then you see it again next to you,
so you feel like it's a sign:
"This means I have to buy it"
Everything there is designed
for you to buy them,
and add to that the lighting factor
and interior design,
which is something
that has specialists responsible for,
and known as "Gruen Effect",
after the famous architect Victor Gruen.
In that concept, you enter a place
carefully designed to misguide you,
it's not a coincidence or lack of attention
that you get lost in malls every time.
It's all carefully designed details
for you to get lost.
So when you're lost,
you see things different from your route,
and actually buy them.
My dear friend, let me
tell you a strange story.
A story from the last place you'd expect...
What? from the bathroom?
Yes actually, specifically men's room.
We're in the men's room in Schiphol
Amsterdam airport in the nineties,
and facing a serious problem,
that men splash around while...you know.
They couldn't take it,
it was too much splashing.
They didn't see the boys' room
in our school,
the Atomic energy agency went
and closed it last week.
They wrote in their report:
Atomic waste that we never witnessed
since Chernobyl.
The problem there was really huge,
and they started looking for a solution.
Because it didn't just spark health hazards,
it also added to the cost of the workers,
where they need to go in
and mop the floors more often,
there's an airport to clean and other stuff.
The managers there tried
the traditional solutions,
like putting up signs:
Please Beware of the splashing,
Leave the place as you wish to find it,
Focus and don't splash,
but none of them worked
and the problem continued.
Here appears, Aad Kieboom,
who suggests an idea
that seems a little silly,
and said they could put
a drawing of a fly inside the urinal.
A fly drawing in the urinal? that's confusing.
He actually had a point,
he suggested giving men a target to aim at
while they're doing what they're doing,
and he was right about his point."
"Men fell for it."
"People were so desperate with this issue,
that they decided to try."
"To their surprise, the urinals with fly drawing
scored way less rates of splashing around,
to the point where they fully adopted
the idea and had the drawing in the rest,
for the problem to finally get solved
and the splashing stops."
"A very inexpensive solution!"
"Anyone can draw a fly."
"This example is one of
the most important ones
that two of the famous
behavioral economists depended on
while presenting their theory
that will make a huge difference
in behavioral economics and economics."
"Richard Thaler and Cass Sunstein,
these two scientists worked on
a concept called the Nudge Theory,
This concept is based on encouraging
people to make specific decisions,
without changing the options they have,
we just direct them in a specific
direction, without telling them."
"They would be acting freely,
but with the way we want them to."
"According to Richard Thaler's definition,
the Nudge is some small edits that can
seem unimportant in the surrounding,
but they can majorly affect
the humans' behavior,
and most importantly
that it's not obligatory."
"You're not actually intervening
in peoples' choices,
nor telling them what to do
and what not to do,
no one is obliged to aim at the fly."
"You're just giving them a nudge,
by accentuating something specific."
"You're still free to choose, yes,
but I'll accentuate a choice."
"There are so many examples of this,
and some of them actually succeed."
"In Chicago,
one of the officials noticed
that a coastal highway
witnesses a lot of accidents."
"Specifically at a certain
curve in the road,
since cars are going at a certain speed."
"So, they don't slow down at that curve."
"Perhaps they get distracted
by the sea view next to them."
"It was very difficult to make
a fundamental change to the road itself,
because it's very active and vital,
so it can't be messed with."
"So, the simple answer was,
similar to the fly in the urinal,
that the traffic management
paint lines on the road in the cars' way,
and as the cars get closer to the curve,
these horizontal lines also
get closer to each other."
"This creates an illusion that
there are more lines than there is,
so the drivers think:
'wait...one, two, three, four, five lines
I'm going too fast, I'll slow down.'"
"Then they slowly pass the curve."
"Without changing the road,
or setting a speed limit, or nothing."
"We only controlled people's decisions
using their own free will."
"They also planted trees,
and made the trees closer,
the more you get to the curve."
"It gives you the same illusion
that you're going too fast."
"Again, we didn't force
people to do anything."
"They can drive at any speed they want."
"We just nudged them
towards a certain choice."
"In his book, Richard Thaler suggested
to use this nudge method
to achieve things with actual benefits."
"For example, encouraging people to
donate organs in countries that allow so,
while keeping their own free will,
whether to do so or not."
"But, it'll be different."
"Meaning, you'll be encouraged
to donate organs,
but, you can also refuse to do so."
"They were able to do that very easily."
"In certain studies,
they found that writing in the paper,
the form you fill before
deciding to donate your organs or not,"
"instead of 'tick yes, if you want to
donate your organs',"
"they write: 'tick yes, if you don't
want to donate your organs.'"
"They found that more people donated."
"Because they felt like that's the norm."
"'If I tick yes, that means
I don't want to donate,
it means I'm out of the norm.'"
"You'll notice that
some applications also do that."
"When they ask if you want
to delete a certain app,
your options aren't yes or no."
"Which means that the default,
pushes people to make certain choices,"
"Without overthinking their decisions."
"They also had other ideas."
"Like, how to make children
eat healthier food,"
"which was achieved by
the way food is presented at schools."
"They found that by presenting healthy food
in a highlighted obvious place,
encourages children to eat it more."
"Again, my friend, we didn't
stop anyone from doing anything."
"We just made them want to eat that food,
because it looks good,
colorful, and stands out."
"Fast food companies always do that."
"They have Happy Meals,
kid's meals, kid's toys,"
"or money-saving meals."
"So, why don't we use these methods
to encourage children to eat healthy food?"
"You may ask: is this ethical?"
"Pushing people towards
certain choices that I made?"
"Whats right for me, could be
wrong for others, Abo Hmeed."
"Richard Thaler says that
the problem is if you don't do that,"
"others will."
"Either way, The food
will be presented to people,"
"and it'll be designed somehow."
"This design won't be
a natural phenomenon at all."
"It'll be designed by other people."
"So, If people will be guided anyway,"
"It's better if they're guided
to choices in their best interest."
"Most importantly to you,
since you now know all this,"
"is to be aware of the choices you're given,"
"and the way they're presented,"
"to make better decisions for yourself,"
"without getting tricked into
doing things you don't want to do."
"One of the most obvious facts,
that we always tend to forget,"
"that the world around us is man-made."
"The world, civilization, roads,
and buildings are not natural phenomena."
"These are things that exist that way,"
"because someone wanted them to be that way."
"Realizing that fact, helps us
deal with the world around us,"
"while knowing the best way to do that."
"Like Richard Thaler
and many others said,"
"The world's design isn't neutral."
"Sooner or later, someone will do it."
"So, it least we should try
and look for the proper design."
"The important thing is to not
completely give in to that design,"
"and, realize its effect
on us and on our choices."
"Also, there's no way that
Uncle Saeed the grocer,"
"with all his grocery income,
doesn't have change."
"However, He has an open box
of gum that no one will probably buy."
"It's unwanted."
"So, he's simply trying to get rid of it."
"Gave you some instead of change,
as if he doesn't have any."
"But, he does have some."
"I salute Uncle Saeed."