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  • Ninay Desai

Dollars and Sense by Dan Ariely and Jeff Kreisler

What makes the world go round? Romantics say love, the literal-minded spout something about the rotation of our planet while some others say money. If you’re part of the last group of people, read on. Actually, read on regardless, because the subject of this book is likely to come in handy.

A copy of Dollars and Sense by Dan Ariely and Jeff Kreisler lies next to a few currency notes and coins on a plain white table. Also visible is a silver-coloured laptop, a pair of black-rimmed spectacles and a lemonade with a paper straw. Photo by Ninay Desai.

In Dollars and Sense, economist and bestselling author, Dan Ariely and financial writer and comedian, Jeff Kreisler answer questions about money that we all should be asking in the pursuit of better understanding why we never have enough money. This is a delightfully funny book about our unconscious motivations, irrational instincts and misguided choices regarding money.

Dollars and Sense isn’t a self-help book because it accepts that we can’t be helped. In other words, Ariely and Kreisler recognise that we are bound by our psychology to make flawed decisions. By illustrating how our brains and emotions hijack the decision-making process, this book provides us with tools to game the system. The system, in this case, are our own minds. Understanding this can help us make better financial choices, spend smarter and save more. This book seemed like a good investment to me. I wasn’t disappointed.

There is no fancy jargon to keep out folks who maintain a safe distance from the pink papers at the newspaper stand. This book discusses the psychology of money in the spirit of a conversation between friends – without judgment and with plenty of anecdotes. You might even find yourself chuckling in recognition at some of the scenarios described in the book because they’re so close to our own lives. Sample this:

“Marco Bertini, Elie Ofek and Dan ran an experiment in which they gave coffee to students. They placed milk and sugar nearby in either fancy dishes or Styrofoam cups. Those who got their milk and sugar from the fancier set-up said they liked the coffee more and would pay more for it, even though, unbeknownst to them, it was the same coffee as the one served near the Styrofoam cups.”

Tell me this has never happened to you! If it hasn’t, then you’re savvier than yours truly. That’s what makes behavioural economics so interesting and if it’s as well-written and humorous as Dollars and Sense, then it’s a win all the way.

Ariely and Kreisler break up their book into 3 parts to delve into the following areas:


Money represents VALUE. Money itself has no value. It only represents the value of other things that we can buy. It’s a messenger of worth.


And then, there is the idea of OPPORTUNITY COSTS. When we spend money on one thing, it’s money we cannot spend on something else, neither now nor any time later.


Ariely and Kreisler shine a light on mind tricks like sale signs promising unbelievable discounts on marked up prices, the exaggerated value we place on things we own or our self-righteous desire to discard the laws of demand and supply to soothe our sense of fairness.

To illustrate our love for sales and how discount signs cause us to make bad money choices, the authors narrate a story about the American department store chain, JCPenney.

“In 2012, Ron Johnson, the new CEO of JCPenney, scrapped Penney’s traditional and slightly deceptive practice of marking products up and then marking them back down. In the decades before Johnson’s arrival, JCPenney always offered customers coupons, deals and in-store discounts… Johnson made the store’s prices ‘fair and square.’ No more coupon cutting, bargain hunting and sale gimmicks. Just the real price, roughly equal to those of its rivals and roughly equal to their previous ‘final’ prices… Most customers detested it and abandoned the chain, grumbling about feeling cheated, being misled and betrayed by the real and true cost, and not liking the fair-and-square pricing. Within a year, JCPenney lost an amazing $985 million and Johnson was out of a job.”

Just goes to show that customer may be king but that’s not necessarily a good thing for the king!


We’re human and yes, we make silly choices and place a greater value on pleasure in the present than our needs in the future. Once we know our Achilles’ heel, we can work around it. Ariely and Kreisler appear to be optimists and believe we can use even our irrationality to give ourselves an edge.

Packed with real-life stories and thought-provoking experiments, Dollars and Sense really makes one think about our dollars and cents. One of my favourite anecdotes in the book is about Pablo Picasso being approached in the park by a woman who insisted he paint her portrait. He looked her over for a moment, then, with a single stroke, drew her a perfect portrait.

“You captured my essence with one stroke. Amazing! How much do I owe you?”

“Five thousand dollars,” Picasso replied.

“What? How could you want so much? It only took you a few seconds!”

“No, ma’am. It took me my entire life and a few more seconds.”

Ariely and Kreisler demonstrate how tempting it is to misjudge great value or ability as being too expensive when we fail to acknowledge the years of effort that have gone into achieving a level of excellence.

I enjoyed reading Dollars and Sense. You might want to read it too, even if only to answer the eternal question: Cash or Card?

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2 Σχόλια

22 Απρ

Sounds like an interesting book.

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Ninay Desai
Ninay Desai
22 Απρ
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Interesting and funny! Do check it out.

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