Why Most Talk About Cognitive Biases is a Waste of Time

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Disclaimer: The following article is an original work by the author whose opinions expressed are his own and are not endorsed by his employer or any of the organizations that he’s a part of. 

The Lollapalooza Effect: “The confluence of psychological tendencies in favor of a particular outcome” Charlie Munger, The Psychology of Human Misjudgment speech, 1995.

Charlie Munger, the famous partner of Warren Buffett at Berkshire Hathaway, gave this speech in frustration to what he clearly saw as the use of psychology to understand real-world phenomena but the psychology written and researched by academic psychologists by and large didn’t deal appropriately with a fundamental issue: “Psychological tendencies tend to be both numerous and inseparably intertwined, now and forever, as they interplay in life.” (From Charlie’s 2005 revision/extension of his 1995 speech).

The whole speech is worth a listen/read to see how Charlie’s experiences have derived (originally 20 but now) 25 tendencies that lead to human misjudgment:

  1. Reward and Punishment Superresponse Tendency
  2. Liking/Loving Tendency
  3. Disliking/Hating Tendency
  4. Doubt-Avoidance Tendency
  5. Inconsistency-Avoidance Tendency
  6. Curiosity Tendency
  7. Kantian Fairness Tendency
  8. Envy/Jealously Tendency
  9. Reciprocation Tendency
  10. Influence-from-Mere-Association Tendency
  11. Simple, Pain-Avoiding Psychological Denial
  12. Excessive Self-Regard Tendency
  13. Overoptimism Tendency
  14. Deprival-Superreaction Tendency
  15. Social-Proof Tendency
  16. Contrast-Misreaction Tendency
  17. Stress-Influence Tendency
  18. Availability-Misweighing Tendency
  19. Use-It-or-Lose-It Tendency
  20. Drug-Misinfluence Tendency
  21. Senescence-Misinfluence Tendency
  22. Authority-Misinfluence Tendency
  23. Twaddle Tendency
  24. Reason-Respecting Tendency
  25. Lollapalooza Tendency—The Tendency to Get Extreme Consequences from Confluences of Psychology Tendencies Acting in Favor of a Particular Outcome

Now for a quick defense for the academic psychologists/behavioral economists/behavioral scientists, most of these listed tendencies have been studied under different namings for the bias/fallacy (see the 1930s “the propagandist’s seven tricks of the trade” list from the now defunct Institute for Propaganda Analysis) and some of these tendencies can be further derived to more primary elements. But in the heap of Charlie’s reinvented wheels was a crown jewel with what he calls the mixing of multiple tendencies together to cause a more powerful, often non-linear effect: the Lollapalooza Effect.

Calling back to my previous Average Geniuses article on how naming things can turn strangeness into familiarity and familiarity into conceptual actions, my coming across the Lollapalooza Effect in graduate school gave me a name for what seemed the obvious answer to explaining outside-the-lab real-world phenomenon involving cognitive biases. I was quite surprised to not find any academic articles mentioning the Lollapalooza Effect back when I came across the concept in 2011 and to this day I have only found one 2022 academic article written in Turkish mentioning the Lollapalooza Effect. In terms of why this omission is the case, Charlie gives a compelling reason in his recap of trying to talk with academic psychologists years ago on how there are likely more than just the “appeals to authority” effects within the famous Milgram experiment:

“And one of the ideas that I came up with which wasn’t in any of the books was that the Lollapalooza effects came when 3 or 4 of the tendencies were operating at once in the same situation. I could see that it wasn’t linear, you’ve got Lollapalooza effects. But the psychology people couldn’t do experiments that were 4 or 5 things happening at once because it got too complicated for them and they couldn’t publish. So they were ignoring the most important thing in their own profession.”

Pulling from my own experience across academia, industry, and national security, I think Charlie Munger was accurate in stating that while academic psychologists have been good at finding and identifying new individual cognitive biases (and boy oh boy does it seem like the list is growing everyday), there is either an inability or a reticence on their part to figure out how to identify the cognitive biases at play in real-life relevant situations and how these different combinations of elements could interact. The fact that there is no concerted academic research effort looking at the combinations and interactions of cognitive biases (even if this complexity is more of the norm for the real-life phenomena of interest than what is focused on in laboratory studies of cognitive biases) puts all talk about how cognitive biases play into our lives in a precarious position in terms ecological validity. Until this research is actively pursued by a community of researchers, most current talk about how cognitive biases affect real-life situations is a waste of time.

So how do we go about trying to make it not a waste of time? The first thing that we would need to do is to recognize that while good laboratory research can allow individual biases to be isolated for study, we need to acknowledge that nearly all real-life situations likely have more than one cognitive bias at play which would means that nearly all real-life situations are “Lollapalooza effects”.

After this acknowledgment, the next thing to acknowledge is that there is more than one kind of Lollapalooza effect. With that acknowledgment, we know that calling all of the different combinations and quantities of tendencies the same term is not going to be helpful for identifying the different “cognitive compounds” that are available. I use the term “cognitive compounds” because I think it’s helpful to see all of the different singular biases as “elements” or “molecules” to be combined and I’m hoping for the same complexity of research into these cognitive compounds as is seen in bonds and structures of chemical compounds.

Finally, to help in pursuing the goal of having a worthwhile talk about cognitive biases, we would need to figure out the metrics and types of observations needed to tell what makes up different cognitive compounds. Repetition of certain elements or a single conspicuous element in isolation; if a certain part is consciously perceived or not; perhaps the physical elements of a stimulus/environment like audio volume or distance from the compound elements are things to measure that will help categorize observations for compounds.

Even with all of those acknowledgments acknowledged, the really hard part comes from initiating a true unity of effort of different experts from across different sectors (e.g. user experience researchers, behavioral scientists, folks at the intersection of applied psychology, and design like neuroesthetics, fashion psychologists, experiential marketers, behavioral design, architectural psychology, etc.). As history has shown us with recent big-money research efforts like the BRAIN Initiative or the Human Brain Project, these kinds of huge collaborations for a research area are hard, humbling, and have many false starts but one thing that it is NOT is a waste of time (I would argue some parts were a waste of money though :-).

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  1. I love how these concepts are outlined. These are good principles to keep in mind, especially when looking at how these affect the organization and individuals in sociotechnical systems – the architectures, people, applications, and users of modern solutions.

    The impact of these hit on all levels. The individuals bring their own biases, the teams and organizations are more often structured around biases, and those human architectural elements have direct impact on the technical architecture and outcomes. A lot to chew on with this one!

  2. Yeah, honestly @seanguillory did an amazing job articulating these biases and relating them down to the human level. That’s what I love about these types of articles.