Self-Interest: Understand this and Understand People (and their decisions)

Ever wonder why people act in a certain way?

Why is my coworker such a suck up? Why do they always get their way? Why do people act differently depending on the audience?

It all comes down to the underpinning concept of Game Theory: people are naturally concerned about their own interests.

And they will act in a certain way to realize those interests. This concept is simple. Yet many still become confused at how people act.

This is because we do not always think about others in terms of their own goals and objectives. However, if you start thinking about people in terms of what they want to achieve, you will be able to better understand why they act in certain ways.

Think about a recent interaction at work; something that may have bothered you. Analyze that interaction and try to determine why the participants acted the way they did.

Some things to think about when analyzing others’ behavior:

• The appearance of selflessness is important. This is a bit cynical, but looked through the perspective of game theory, it makes sense. People act this way consciously or unconsciously.
• People are rational. In general, people are good at making decisions that further their own interests. This is not to say that people never make bad decisions. But if you start from the assumption that people are trying to do what is best for themselves, you’re starting at a good spot.
• Irrational actors and complexity enter the picture as you scale up. Understanding people as individuals is much easier than as a group. Group dynamics is, as the name implies, “dynamic”. So don’t make similar assumptions as with individuals.

Thinking this way enables you to predict (to some degree) what people will do. It allows you to better understand their actions. As a result, you will be able to improve your interactions with others.

Read this post and more on my Typeshare Social Blog