cognitive-dissonance

What Is Cognitive Dissonance? Cognitive Dissonance In A Nutshell

Business / By / September 28, 2023

The term cognitive dissonance was first described by psychologist Leon Festinger in 1957. Festinger and his colleagues paid people either $1 or $20 to engage in a boring task for an hour. The participants who were paid $1 evaluated the task as more enjoyable than those who were paid $20, which seems counterintuitive. Therefore, cognitive dissonance describes mental discomfort arising from holding two contradictory values, attitudes, perspectives, ideas, or beliefs. 

Understanding cognitive dissonance

In what would become a pioneering experiment, Festinger and his colleagues paid people either $1 or $20 to engage in a boring task for an hour. The participants who were paid $1 evaluated the task as more enjoyable than those who were paid $20, which seems counterintuitive. 

However, lower-paid participants rated the task as more enjoyable than higher-paid participants because of cognitive dissonance. The paltry $1 they received was not enough to warrant them lying about the task, so they effectively convinced themselves that it was enjoyable. On the other hand, those who were paid $20 believed the amount was enough to justify lying and did not experience cognitive dissonance.

Put more succinctly, the dissonance occurred between the cognition of the $1 group (they really did not want to lie) and their behavior (they nevertheless lied). To reconcile this disconnect, they changed their belief about the boring task by instead reporting that it was enjoyable.

Ultimately, Festinger demonstrated that people have a desire for consistency in their beliefs and behaviors – even if it is achieved in a non-rational way.

What causes cognitive dissonance?

Multiple studies have shown that cognitive dissonance is caused by three main factors.

1 – Forced compliance behavior 

When someone is publicly forced to do something they privately did not want to do, cognitive dissonance results. 

Since the behavior causing the disconnect occurred in the past and cannot be altered, dissonance needs to be reduced by the individual re-evaluating their beliefs. This is what happened to participants in the study described in the previous section.

2 – Decision making 

As a general rule, decision-making invites dissonance. The employee who receives a lucrative job offer to work overseas must weigh up the pros and cons of accepting the job or staying put nearer to friends and family. Whichever option is chosen, the act of making a decision forces the individual to accept that they’ll never get to enjoy the advantages of the unchosen alternative. What’s more, it forces them to accept the disadvantages of the chosen alternative. 

To reduce dissonance during decision-making, many people adopt a strategy called “spreading apart the alternatives”. This means they increase the attractiveness of the chosen alternative while decreasing the attractiveness of the rejected alternative.

3 – Effort 

Humans also tend to attach more value to goals or items considered the most difficult to achieve. This helps us avoid the dissonance that results when we expel a great deal of effort in achieving something that turns out to be a waste of time.

On the contrary, we may convince ourselves the effort was quite enjoyable or that we didn’t expend as much time or effort as originally thought. This method of reducing cognitive dissonance by reframing the experience as more interesting is called effort justification.

Common examples of cognitive dissonance

Here are three examples of cognitive dissonance that most may be able to relate to:

  • Getting enough exercise – most people value their health and want to live for as long as possible. However, they may spend all day sitting at a desk and pay for a gym membership they never use. 
  • Being productive at work – office employees who are not closely monitored may spend the majority of their workday watching YouTube videos or planning their next vacation. Most feel guilty about their lack of productivity but may justify non-work activities by proclaiming they’ve had a busy month.
  • Picking up after the dog – most dog owners are responsible and take plastic bags with them on walks. However, consider a scenario where a dog decides to do its business on the one day the dog owner forgets the bags. The owner may look around to see if anyone noticed and then quickly vacate the area. At home, they feel guilty for their actions but ultimately rationalize it by convincing themselves that this will be the last time it happens.
  • Healthy Lifestyle vs. Sedentary Behavior: Individuals who value a healthy lifestyle but spend most of their day sitting at a desk without exercising experience cognitive dissonance. To reduce discomfort, they may downplay the importance of exercise or make plans to start exercising in the future.
  • Productivity vs. Procrastination: Employees who value productivity but engage in procrastination at work experience cognitive dissonance. They may justify their non-work activities by convincing themselves that they deserve a break or that they work better under pressure.
  • Environmental Concern vs. Unearthly Lifestyle: People who express concern for the environment but engage in wasteful or environmentally harmful habits face cognitive dissonance. To resolve this conflict, they may rationalize their behavior by downplaying the impact of their actions.
  • Healthy Eating vs. Indulgence: Individuals who prioritize healthy eating but occasionally indulge in unhealthy foods experience cognitive dissonance. They may justify their indulgence by considering it a reward or treating it as an exception to their overall healthy diet.
  • Financial Responsibility vs. Impulsive Spending: People who value financial responsibility but engage in impulsive spending experience cognitive dissonance. To resolve this, they may rationalize their spending as a necessary treat or convince themselves they will budget better in the future.
  • Ethical Values vs. Unethical Behavior: Individuals who hold strong ethical values but engage in unethical actions may experience cognitive dissonance. To reduce discomfort, they may justify their behavior as necessary or deny its unethical nature.
  • Parental Expectations vs. Personal Aspirations: Young adults who feel pressured to pursue specific career paths based on parental expectations may experience cognitive dissonance. They may rationalize their decisions by believing they can find happiness and success in their parents’ chosen path.
  • Environmental Awareness vs. Energy Consumption: People who are aware of environmental issues but consume excessive energy may experience cognitive dissonance. To reduce discomfort, they may focus on small eco-friendly actions they take or downplay the impact of their energy consumption.
  • Social Responsibility vs. Inaction: Individuals who express concern about social issues but fail to take any meaningful action to address them can experience cognitive dissonance. They may rationalize their inaction by believing that they are too busy or that their individual efforts won’t make a significant difference.
  • Safety Consciousness vs. Risky Behavior: People who emphasize safety and risk avoidance but engage in risky activities like extreme sports may experience cognitive dissonance. They might justify their behavior by arguing that they take all necessary precautions or that the thrill is worth the risk.
  • Relationship Commitment vs. Infidelity: Individuals in committed relationships who engage in infidelity may experience cognitive dissonance. To ease their discomfort, they might convince themselves that their actions don’t truly harm their partner or that their partner deserves it.
  • Education Importance vs. Skipping Classes: Students who value the importance of education but frequently skip classes experience cognitive dissonance. They may rationalize their absences by thinking they can catch up later or that the class material isn’t essential.
  • Charitable Intentions vs. Selfishness: People who claim to have charitable intentions but rarely donate time or money to causes may experience cognitive dissonance. They may justify their inaction by believing they contribute in other ways or that they can’t afford to give right now.
  • Time Management vs. Procrastination: Individuals who prioritize effective time management but consistently procrastinate on tasks experience cognitive dissonance. They may rationalize their procrastination by convincing themselves that they work better under pressure or that they have plenty of time.
  • Gender Equality Support vs. Gender-Biased Actions: Those who publicly support gender equality but exhibit gender-biased behaviors may experience cognitive dissonance. They might rationalize their actions by saying they were unaware of their bias or that their behavior was unintentional.
  • Health Consciousness vs. Smoking: People who are health-conscious but continue to smoke cigarettes may experience cognitive dissonance. They may rationalize their smoking by thinking that they’ll quit eventually or that it’s their only source of stress relief.
  • Honesty Values vs. Dishonesty: Individuals who value honesty but occasionally lie or deceive others may experience cognitive dissonance. They might justify their dishonesty by believing it’s for a greater good or that everyone lies sometimes.
  • Parental Guidance vs. Peer Pressure: Teenagers who receive parental guidance against certain behaviors but succumb to peer pressure and engage in those behaviors may experience cognitive dissonance. They might rationalize their actions by asserting that they had to fit in or that their parents don’t understand their generation.

Key takeaways:

  • Cognitive dissonance describes mental discomfort arising from holding two contradictory values, attitudes, perspectives, ideas, or beliefs. The term was first described by psychologist Leon Festinger in 1957, who conducted a series of pioneering experiments on the subject.
  • Cognitive dissonance is primarily caused by forced compliance behavior, decision making, and effort. In each case, disharmony between the beliefs and behaviors of the individual causes them to avoid discomfort in sometimes irrational ways.
  • Relatable examples of cognitive dissonance include getting enough exercise, being productive at work, and picking up after the dog.

Connected Thinking Frameworks

Convergent vs. Divergent Thinking

convergent-vs-divergent-thinking
Convergent thinking occurs when the solution to a problem can be found by applying established rules and logical reasoning. Whereas divergent thinking is an unstructured problem-solving method where participants are encouraged to develop many innovative ideas or solutions to a given problem. Where convergent thinking might work for larger, mature organizations where divergent thinking is more suited for startups and innovative companies.

Critical Thinking

critical-thinking
Critical thinking involves analyzing observations, facts, evidence, and arguments to form a judgment about what someone reads, hears, says, or writes.

Biases

biases
The concept of cognitive biases was introduced and popularized by the work of Amos Tversky and Daniel Kahneman in 1972. Biases are seen as systematic errors and flaws that make humans deviate from the standards of rationality, thus making us inept at making good decisions under uncertainty.

Second-Order Thinking

second-order-thinking
Second-order thinking is a means of assessing the implications of our decisions by considering future consequences. Second-order thinking is a mental model that considers all future possibilities. It encourages individuals to think outside of the box so that they can prepare for every and eventuality. It also discourages the tendency for individuals to default to the most obvious choice.

Lateral Thinking

lateral-thinking
Lateral thinking is a business strategy that involves approaching a problem from a different direction. The strategy attempts to remove traditionally formulaic and routine approaches to problem-solving by advocating creative thinking, therefore finding unconventional ways to solve a known problem. This sort of non-linear approach to problem-solving, can at times, create a big impact.

Bounded Rationality

bounded-rationality
Bounded rationality is a concept attributed to Herbert Simon, an economist and political scientist interested in decision-making and how we make decisions in the real world. In fact, he believed that rather than optimizing (which was the mainstream view in the past decades) humans follow what he called satisficing.

Dunning-Kruger Effect

dunning-kruger-effect
The Dunning-Kruger effect describes a cognitive bias where people with low ability in a task overestimate their ability to perform that task well. Consumers or businesses that do not possess the requisite knowledge make bad decisions. What’s more, knowledge gaps prevent the person or business from seeing their mistakes.

Occam’s Razor

occams-razor
Occam’s Razor states that one should not increase (beyond reason) the number of entities required to explain anything. All things being equal, the simplest solution is often the best one. The principle is attributed to 14th-century English theologian William of Ockham.

Lindy Effect

lindy-effect
The Lindy Effect is a theory about the ageing of non-perishable things, like technology or ideas. Popularized by author Nicholas Nassim Taleb, the Lindy Effect states that non-perishable things like technology age – linearly – in reverse. Therefore, the older an idea or a technology, the same will be its life expectancy.

Antifragility

antifragility
Antifragility was first coined as a term by author, and options trader Nassim Nicholas Taleb. Antifragility is a characteristic of systems that thrive as a result of stressors, volatility, and randomness. Therefore, Antifragile is the opposite of fragile. Where a fragile thing breaks up to volatility; a robust thing resists volatility. An antifragile thing gets stronger from volatility (provided the level of stressors and randomness doesn’t pass a certain threshold).

Ergodicity

ergodicity
Ergodicity is one of the most important concepts in statistics. Ergodicity is a mathematical concept suggesting that a point of a moving system will eventually visit all parts of the space the system moves in. On the opposite side, non-ergodic means that a system doesn’t visit all the possible parts, as there are absorbing barriers

Systems Thinking

systems-thinking
Systems thinking is a holistic means of investigating the factors and interactions that could contribute to a potential outcome. It is about thinking non-linearly, and understanding the second-order consequences of actions and input into the system.

Vertical Thinking

vertical-thinking
Vertical thinking, on the other hand, is a problem-solving approach that favors a selective, analytical, structured, and sequential mindset. The focus of vertical thinking is to arrive at a reasoned, defined solution.

Metaphorical Thinking

metaphorical-thinking
Metaphorical thinking describes a mental process in which comparisons are made between qualities of objects usually considered to be separate classifications.  Metaphorical thinking is a mental process connecting two different universes of meaning and is the result of the mind looking for similarities.

Maslow’s Hammer

einstellung-effect
Maslow’s Hammer, otherwise known as the law of the instrument or the Einstellung effect, is a cognitive bias causing an over-reliance on a familiar tool. This can be expressed as the tendency to overuse a known tool (perhaps a hammer) to solve issues that might require a different tool. This problem is persistent in the business world where perhaps known tools or frameworks might be used in the wrong context (like business plans used as planning tools instead of only investors’ pitches).

Peter Principle

peter-principle
The Peter Principle was first described by Canadian sociologist Lawrence J. Peter in his 1969 book The Peter Principle. The Peter Principle states that people are continually promoted within an organization until they reach their level of incompetence.

Straw Man Fallacy

straw-man-fallacy
The straw man fallacy describes an argument that misrepresents an opponent’s stance to make rebuttal more convenient. The straw man fallacy is a type of informal logical fallacy, defined as a flaw in the structure of an argument that renders it invalid.

Google Effect

google-effect
The Google effect is a tendency for individuals to forget information that is readily available through search engines. During the Google effect – sometimes called digital amnesia – individuals have an excessive reliance on digital information as a form of memory recall.

Streisand Effect

streisand-effect
The Streisand Effect is a paradoxical phenomenon where the act of suppressing information to reduce visibility causes it to become more visible. In 2003, Streisand attempted to suppress aerial photographs of her Californian home by suing photographer Kenneth Adelman for an invasion of privacy. Adelman, who Streisand assumed was paparazzi, was instead taking photographs to document and study coastal erosion. In her quest for more privacy, Streisand’s efforts had the opposite effect.

Compromise Effect

compromise-effect
Single-attribute choices – such as choosing the apartment with the lowest rent – are relatively simple. However, most of the decisions consumers make are based on multiple attributes which complicate the decision-making process. The compromise effect states that a consumer is more likely to choose the middle option of a set of products over more extreme options.

Butterfly Effect

butterfly-effect
In business, the butterfly effect describes the phenomenon where the simplest actions yield the largest rewards. The butterfly effect was coined by meteorologist Edward Lorenz in 1960 and as a result, it is most often associated with weather in pop culture. Lorenz noted that the small action of a butterfly fluttering its wings had the potential to cause progressively larger actions resulting in a typhoon.

IKEA Effect

ikea-effect
The IKEA effect is a cognitive bias that describes consumers’ tendency to value something more if they have made it themselves. That is why brands often use the IKEA effect to have customizations for final products, as they help the consumer relate to it more and therefore appending to it more value.

Ringelmann Effect 

Ringelmann Effect
The Ringelmann effect describes the tendency for individuals within a group to become less productive as the group size increases.

The Overview Effect

overview-effect
The overview effect is a cognitive shift reported by some astronauts when they look back at the Earth from space. The shift occurs because of the impressive visual spectacle of the Earth and tends to be characterized by a state of awe and increased self-transcendence.

House Money Effect

house-money-effect
The house money effect was first described by researchers Richard Thaler and Eric Johnson in a 1990 study entitled Gambling with the House Money and Trying to Break Even: The Effects of Prior Outcomes on Risky Choice. The house money effect is a cognitive bias where investors take higher risks on reinvested capital than they would on an initial investment.

Heuristic

heuristic
As highlighted by German psychologist Gerd Gigerenzer in the paper “Heuristic Decision Making,” the term heuristic is of Greek origin, meaning “serving to find out or discover.” More precisely, a heuristic is a fast and accurate way to make decisions in the real world, which is driven by uncertainty.

Recognition Heuristic

recognition-heuristic
The recognition heuristic is a psychological model of judgment and decision making. It is part of a suite of simple and economical heuristics proposed by psychologists Daniel Goldstein and Gerd Gigerenzer. The recognition heuristic argues that inferences are made about an object based on whether it is recognized or not.

Representativeness Heuristic

representativeness-heuristic
The representativeness heuristic was first described by psychologists Daniel Kahneman and Amos Tversky. The representativeness heuristic judges the probability of an event according to the degree to which that event resembles a broader class. When queried, most will choose the first option because the description of John matches the stereotype we may hold for an archaeologist.

Take-The-Best Heuristic

take-the-best-heuristic
The take-the-best heuristic is a decision-making shortcut that helps an individual choose between several alternatives. The take-the-best (TTB) heuristic decides between two or more alternatives based on a single good attribute, otherwise known as a cue. In the process, less desirable attributes are ignored.

Bundling Bias

bundling-bias
The bundling bias is a cognitive bias in e-commerce where a consumer tends not to use all of the products bought as a group, or bundle. Bundling occurs when individual products or services are sold together as a bundle. Common examples are tickets and experiences. The bundling bias dictates that consumers are less likely to use each item in the bundle. This means that the value of the bundle and indeed the value of each item in the bundle is decreased.

Barnum Effect

barnum-effect
The Barnum Effect is a cognitive bias where individuals believe that generic information – which applies to most people – is specifically tailored for themselves.

Anchoring Effect

anchoring-effect
The anchoring effect describes the human tendency to rely on an initial piece of information (the “anchor”) to make subsequent judgments or decisions. Price anchoring, then, is the process of establishing a price point that customers can reference when making a buying decision.

Decoy Effect

decoy-effect
The decoy effect is a psychological phenomenon where inferior – or decoy – options influence consumer preferences. Businesses use the decoy effect to nudge potential customers toward the desired target product. The decoy effect is staged by placing a competitor product and a decoy product, which is primarily used to nudge the customer toward the target product.

Commitment Bias

commitment-bias
Commitment bias describes the tendency of an individual to remain committed to past behaviors – even if they result in undesirable outcomes. The bias is particularly pronounced when such behaviors are performed publicly. Commitment bias is also known as escalation of commitment.

First-Principles Thinking

first-principles-thinking
First-principles thinking – sometimes called reasoning from first principles – is used to reverse-engineer complex problems and encourage creativity. It involves breaking down problems into basic elements and reassembling them from the ground up. Elon Musk is among the strongest proponents of this way of thinking.

Ladder Of Inference

ladder-of-inference
The ladder of inference is a conscious or subconscious thinking process where an individual moves from a fact to a decision or action. The ladder of inference was created by academic Chris Argyris to illustrate how people form and then use mental models to make decisions.

Goodhart’s Law

goodharts-law
Goodhart’s Law is named after British monetary policy theorist and economist Charles Goodhart. Speaking at a conference in Sydney in 1975, Goodhart said that “any observed statistical regularity will tend to collapse once pressure is placed upon it for control purposes.” Goodhart’s Law states that when a measure becomes a target, it ceases to be a good measure.

Six Thinking Hats Model

six-thinking-hats-model
The Six Thinking Hats model was created by psychologist Edward de Bono in 1986, who noted that personality type was a key driver of how people approached problem-solving. For example, optimists view situations differently from pessimists. Analytical individuals may generate ideas that a more emotional person would not, and vice versa.

Mandela Effect

mandela-effect
The Mandela effect is a phenomenon where a large group of people remembers an event differently from how it occurred. The Mandela effect was first described in relation to Fiona Broome, who believed that former South African President Nelson Mandela died in prison during the 1980s. While Mandela was released from prison in 1990 and died 23 years later, Broome remembered news coverage of his death in prison and even a speech from his widow. Of course, neither event occurred in reality. But Broome was later to discover that she was not the only one with the same recollection of events.

Crowding-Out Effect

crowding-out-effect
The crowding-out effect occurs when public sector spending reduces spending in the private sector.

Bandwagon Effect

bandwagon-effect
The bandwagon effect tells us that the more a belief or idea has been adopted by more people within a group, the more the individual adoption of that idea might increase within the same group. This is the psychological effect that leads to herd mentality. What in marketing can be associated with social proof.

Moore’s Law

moores-law
Moore’s law states that the number of transistors on a microchip doubles approximately every two years. This observation was made by Intel co-founder Gordon Moore in 1965 and it become a guiding principle for the semiconductor industry and has had far-reaching implications for technology as a whole.

Disruptive Innovation

disruptive-innovation
Disruptive innovation as a term was first described by Clayton M. Christensen, an American academic and business consultant whom The Economist called “the most influential management thinker of his time.” Disruptive innovation describes the process by which a product or service takes hold at the bottom of a market and eventually displaces established competitors, products, firms, or alliances.

Value Migration

value-migration
Value migration was first described by author Adrian Slywotzky in his 1996 book Value Migration – How to Think Several Moves Ahead of the Competition. Value migration is the transferal of value-creating forces from outdated business models to something better able to satisfy consumer demands.

Bye-Now Effect

bye-now-effect
The bye-now effect describes the tendency for consumers to think of the word “buy” when they read the word “bye”. In a study that tracked diners at a name-your-own-price restaurant, each diner was asked to read one of two phrases before ordering their meal. The first phrase, “so long”, resulted in diners paying an average of $32 per meal. But when diners recited the phrase “bye bye” before ordering, the average price per meal rose to $45.

Groupthink

groupthink
Groupthink occurs when well-intentioned individuals make non-optimal or irrational decisions based on a belief that dissent is impossible or on a motivation to conform. Groupthink occurs when members of a group reach a consensus without critical reasoning or evaluation of the alternatives and their consequences.

Stereotyping

stereotyping
A stereotype is a fixed and over-generalized belief about a particular group or class of people. These beliefs are based on the false assumption that certain characteristics are common to every individual residing in that group. Many stereotypes have a long and sometimes controversial history and are a direct consequence of various political, social, or economic events. Stereotyping is the process of making assumptions about a person or group of people based on various attributes, including gender, race, religion, or physical traits.

Murphy’s Law

murphys-law
Murphy’s Law states that if anything can go wrong, it will go wrong. Murphy’s Law was named after aerospace engineer Edward A. Murphy. During his time working at Edwards Air Force Base in 1949, Murphy cursed a technician who had improperly wired an electrical component and said, “If there is any way to do it wrong, he’ll find it.”

Law of Unintended Consequences

law-of-unintended-consequences
The law of unintended consequences was first mentioned by British philosopher John Locke when writing to parliament about the unintended effects of interest rate rises. However, it was popularized in 1936 by American sociologist Robert K. Merton who looked at unexpected, unanticipated, and unintended consequences and their impact on society.

Fundamental Attribution Error

fundamental-attribution-error
Fundamental attribution error is a bias people display when judging the behavior of others. The tendency is to over-emphasize personal characteristics and under-emphasize environmental and situational factors.

Outcome Bias

outcome-bias
Outcome bias describes a tendency to evaluate a decision based on its outcome and not on the process by which the decision was reached. In other words, the quality of a decision is only determined once the outcome is known. Outcome bias occurs when a decision is based on the outcome of previous events without regard for how those events developed.

Hindsight Bias

hindsight-bias
Hindsight bias is the tendency for people to perceive past events as more predictable than they actually were. The result of a presidential election, for example, seems more obvious when the winner is announced. The same can also be said for the avid sports fan who predicted the correct outcome of a match regardless of whether their team won or lost. Hindsight bias, therefore, is the tendency for an individual to convince themselves that they accurately predicted an event before it happened.

Read Next: Biases, Bounded Rationality, Mandela Effect, Dunning-Kruger Effect, Lindy Effect, Crowding Out Effect, Bandwagon Effect.

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Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
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