An entrepreneur studies the business literature

Cognitive mechanisms in entrepreneurship

Human cognition research suggests that we are not a totally rational species: Thinking errors and biases are part of the human condition. Baron’s 1998 article explores how entrepreneurs think differently from non-entrepreneurs and how these differences could lead to an increased susceptibility to certain thinking errors and biases. He then examines five specific thinking errors and their relevance to entrepreneurs.

Outsmart your own biases

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Humans are riddled with thinking biases. We rely on two different cognitive systems for decision making. System 1 thinking relies on intuition, whereas System 2 uses rational, deliberate reasoning. Unfortunately, both systems are imperfect and wrought with thinking biases that can lead to poor decision making. Soll, Milkman, and Payne, in their 2015 article, provide an assortment of methods to help managers identify and overcome some of the most common decision-making traps.