I am taking Intermediate Microeconomics at school, and on the first day of class, my professor brought up the pervasiveness of preference uncertainty. I had not given preference uncertainty much thought before, but I have noticed that I am more uncertain about my own preferences than I had realized. I am frequently uncertain about my lunch preferences. Some of this uncertainty may be exaggerated because the situations in which I notice I am uncertain about are those situations where my preferences are not strong. However, I also sometimes realize that deciding to walk elsewhere to buy lunch to save money, that the decision was not even close to worth it. I don’t think I would make that mistake if I had a better grasp on my preferences .

Incidentally, I recently read Predictably Irrational (which was OK), and I noticed that many of the mistakes and biases that the book describes seem to stem, at least partially, from our uncertainty about our preferences. For example, the book discusses our tendency to ‘anchor’ to initial prices. We tend to judge prices relative to the first prices we first observed for a particular product. If we had a good understanding of our own preferences, that wouldn’t happen very frequently.

I am not sure what general implications preference uncertainty has, but it seems useful to keep it in mind when making decisions.