Animal Spirits Podcast

Talk Your Book: Investing in Human Capital

Apr 25, 2022
Dan Ariely, a Duke University professor and author of *Predictably Irrational*, joins the conversation along with Kristof Gleich. They delve into the intricacies of investing in human capital, emphasizing its crucial role in corporate culture and performance. The discussion uncovers how emotional responses influence investment choices and highlights challenges like bureaucracy that hinder employee satisfaction. Ariely advocates for a fresh investment strategy focused on human capital, aligning workplace environments with broader financial goals and social considerations.
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ADVICE

Designing for Better Behavior

  • Design better environments that encourage better behavior.
  • Don't rely on surveys to fix human nature; instead, create supportive systems.
INSIGHT

Flawed Investment Surveys

  • Current investment surveys are meaningless because they ask hypothetical questions about market drops.
  • Basing investment strategies on these surveys leads to poor decisions.
ADVICE

Controllable Investment Actions

  • Focus on controllable investment actions, like opening savings accounts or increasing retirement contributions.
  • Don't fixate on daily market fluctuations, which are beyond individual control.
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