System 1 and system 2 have become some of the most widely used terms in market research as the industry seeks to integrate behavioural science into its practice. Whilst the principles of these terms are fairly simple, there are also some complexities associated with them that needs to be understood.
System 1 and System 2 refer to an overarching set of theories from psychology claiming that there are two distinct operating systems that govern our behaviour. Collectively, they are known as dual process theory (DPT). This is structured around the idea that these two 'systems' (1 and 2) govern our perception, our beliefs, and our actions. Generally, these theories hold that:
- System 1 is fast and intuitive/experiential: System 1 is an automatic process constantly running in the background (nonconsciously). System 1 processing is effortless (no strong demand on our thinking such as computational capacity and working memory). Because System 1 is designed to process information efficiently, it often uses automatic 'rules of thumb', known as heuristics, to combine information and activate behaviours.
- System 2 is slow and reflective: System 2 engages controlled processes (conscious) relying on more reasoning (rule-based, logical, analytical). Because this reasoning is more demanding, the thinking process is serial, slower, and effortful. System 2 is designed to make accurate decisions, so when it is "switched on", decisions more often match rational norms.
Although system 1 and system 2 came to prominence with the publication of Daniel Kahneman's book 'Thinking Fast & Slow', DPT has a long heritage. There have been at least 12 different theories of DPT over the past 40 or so years and the distinction between different types of thinking has been around for well over 150 years.
Ipsos Point Of View
DPT is an integral element underpinning much of modern psychology. So, for example, the work of Daniel Kahneman and Amos Tversky (who dominated the research into the psychology of Judgement and Decision Making) is essentially cognitive psychology. Whilst this area is often seen as the corner stone of behavioural science, at Ipsos we are taking a market challenging position by adopting a broader perspective for the definition of the discipline, drawing on a much wider range of psychology and other social sciences to inform our practice.
So whilst explanations of behaviour using DPT can be useful to understand consumer behaviour, this is still, nevertheless, one lens and should not be taken as a means to characterise and explain all behaviour. The value of DPT as a means to explain, understand and predict behaviour will largely depend on the degree to which it can help inform the question being asked.
At Ipsos we are at the forefront of:
- Carefully defining terms to increase the precision with which we can attribute behaviours to system 1 and system 2
- Developing tools that can be used to measure system 1 and system 2 processes and behaviours
- Developing an understanding of the ways in which DPT can serve as an explanatory framework for a wide variety of consumer behaviour
Related to the system 1 and system 2 lens are a number of core concepts that are defined below. Specifically, bounded rationality is a view of decision makers that was a precursor to and foundational element of what developed to be the system 1 and system 2 perspective. Other core concepts including choice architecture, nudge, heuristics and bias are also defined below. These overarching concepts are followed by specific examples of heuristics, biases, effects, and fallacies that are organised according to cognitive demands that they help us address.
There is very little, if any accessible material which attempts to place DPT into a wider context. However, Colin Strong has written about it here: A practitioner's Guide to System 1
A useful overview of DPT can be gained by reading Daniel Kahneman;s book, 'Thinking Fast and Slow'. Pascal Bourget has also written a POV Paper on the subject.
Other academic literature which debates the value of DPT can be found in the following:
This paper sets out the core principle why we are not able to access our own (system 1) mental processes
Nisbett, Richard E., and Timothy D. Wilson. "Telling more than we can know: Verbal reports on mental processes." Psychological review 84, no. 3 (1977): 231
This is an alternative perspective based on a more recent review of the literature which suggests that we have more insight into our own mental processes than Nisbett and Wilson claimed:
Newell, B. R., & Shanks, D. R. (2014). Unconscious influences on decision making: A critical review. Behavioral and Brain Sciences, 37(01), 1-19.
This paper supports the principle of DPT but calls for more precision in the way we use it:
Evans, J. (2012). "Questions and challenges for the new psychology of reasoning". Thinking & Reasoning. 18 (1): 5–31.
This article is a provocative and entertaining read on the philosophy concerning accessibility of our own inner lives: Midgley, Mary (2004) Zombies can't concentrate. Philosophy Now
And for an alternative perspective see Daniel Wegner "The Illusion of conscious will"
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