Risk Savvy

How to Make Good Decisions

By: Gerd Gigerenzer

Narrated by: Al Kessel

An eye-opening look at the ways we misjudge risk every day and a guide to making better decisions with our money, health, and personal lives

In the age of Big Data we often believe that our predictions about the future are better than ever before. But as risk expert Gerd Gigerenzer shows, the surprising truth is that in the real world, we often get better results by using simple rules and considering less information.

In Risk Savvy, Gigerenzer reveals that most of us, including doctors, lawyers, financial advisers, and elected officials, misunderstand statistics much more often than we think, leaving us not only misinformed, but vulnerable to exploitation. Yet there is hope. Anyone can learn to make better decisions for their health, finances, family, and business without needing to consult an expert or a super computer, and Gigerenzer shows us how.

Risk Savvy is an insightful and easy-to-understand remedy to our collective information overload and an essential guide to making smart, confident decisions in the face of uncertainty.

©2014 Gerd Gigerenzer (P)2020 Tantor

A good guide on how to think

Well read.

Some good examples of biases, and some tricks in reporting, that show how little we sometimes understand, and how many parties like it that way.

The best parts of the book teach you how to think about risk.
My least favorite part was related to lifestyle risk, where the author strayed into telling us what to think, about eating and exercising. It's probably good advice, but it's not consistent with the rest of the book.

A long-overdue read

I first heard of Prof Gigerenzer after reading Daniel Kahneman’s Thinking Fast and Slow, which, BTW, changes my way of seeing the world. I was a faithful servant to the “system two thinking” but unfortunately and inevitably, I soon came to the realization that I am fooling myself when I tried to come up with all factors and their weights and values in order to make a decision. In Mr. Gigerenzer’s word:

“In an uncertain world (the real world), simple heuristics trump complex computations for decision making.”

This is a long-overdue read for me because I have been contemplating on the topics of decision-making, behavioral psychology, complexity and design for years now. How to exactly understand the relationship between the forever increasing complexity of the world and the need for simple solutions? Is this a contradiction? Risk savvy gives a satisfactory answer: draw the line between whisk and uncertainty, and then use statistical thinking and rule of thumb correspondingly. Heuristics, which, at the first glance, appears to be oversimplified and less accurate than mathematical models, deliver a good enough result in a much speedy and cost-efficient way. These heuristics, or intuitions, are what experts work so hard to attain and help them win models in sports, mates and contracts. Of course, Kahneman’s warning is still valid here: many of these heuristics are inherited either genetically or culturally and often exploited; hence we need to be able to tell which are useful when.

Some other aspects of the book which I find interesting are the descriptions on the healthcare system and the financial industry. I am surprised by the three factors that those agents are very often act against our best interest: risk illiteracy, defensive medicine and conflict of interests.

Finally even through a fair amount of content in the book I already know, I still find it an interesting and beneficial read because it looks at matters from the perspective of risk and feels very grounded as it provides tips and understanding needed to deal with everyday matters.

I would recommend this book.

Good book

Some really great points about risk assessment and awareness. A very rational and critical look at these topics. I would recommend it to those who are interested

Fantastic Examples

Content on statistics is great. Amazing examples though, very clear, easy to remember and impactful.

An important book in the efforts of risk literacy.

I was both surprised and delighted by this book. It is rare to see any anti-paternalism in today's risk literature.