The madness of the Marrakesh medina: my system 1 on overdrive

I recently had the pleasure of visiting Morocco on holiday - just under 4 hours from the UK on a short-haul flight yet worlds apart in terms of culture. 

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High on my bucket list of things to do was a visit to the world famous Jemaa el-Fnaa – the main large public square in the medina of the old town where street entertainers, small markets and hawkers come together to create an incredible and vibrant experience. 

Described as the ‘Las Vegas’ of North Africa I had already done some research into what to expect and had spoken to various friends who advised me on the rules of haggling within the souks and market stalls.  I was fully prepared for the selling onslaught – or so I thought – and had pre-empted what some of my strategies might be in terms of bagging a bargain and not succumbing to buying the first silk purse or handcrafted carpet I saw (note to self: I will not come home with a rug, however beautiful it might be). 

But the medina of Morocco is like no-where else I’d ever been before.  To say the selling is full-on is an understatement.  At times it can feel like harassment and coercion.  Making eye-contact with anyone was an instant no-no – it implied interest and an openness to buy. 

Rationally of course, I knew that me buying anything was completely at my discretion.  I vowed I would make good judgement calls as to what was a worthy purchase and what to avoid.  I was open somewhat to temptation but within the confines of what I was reasonably prepared to pay. 

But the pressure I felt forced my system 1 into overdrive …

Reflecting on my purchases a few days later made me realise the wealth of cognitive biases that had – quite frankly – f***d up my decision-making. 

The first problem was the exchange rate.  There are roughly 13 dirhams to the £ meaning prices on menus and in shops where prices are displayed are typically 3 if not 4 digits.  Doing the mental maths on the fly to convert back to £s and determine if a price a market stall seller was outrageous or reasonable was impossible.  So, my lazy system 1 kicked in various ways:

  • The affective bias – put simply this is our tendency to do business with someone just because we like them.  One way of whittling down the market-stalls into ones I was prepared to buy from was simply by going with my gut of which sellers felt more approachable and ‘on my level’.  Their charm and pleasantness distorted my ability to rationally sense check if their goods or their prices were indeed better than the stall next door selling precisely the same items. 
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  • Anchoring – during one negotiation with a market-stall seller over a set of hand-painted ceramic plates the seller quoted an opening price of around 1000 dirham.  I knew instinctively this was high and haggled him down to 700 dirhams – a whopping 30% bargain.  I felt satisfied I’d bargained him down and got such a good saving.  But reflecting on my purchase afterwards the final price I’d spent was way more than what I should have paid for the goods I got.  My perception of value had been distorted due to the high opening anchor point at which I compared my final bargained price. 
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  • Choice-supportive bias – this is the bias that when you choose something, you tend to feel positive about it, even if that choice has flaws.  In the markets of Marrakesh this was my over-delight at my purchases even when if I thought about it afterwards it I’d made some average to terrible buys.

All humans are cognitive misers and revert to System 1 far more often than imaginable – we know this from existing behavioural economics evidence.  But what the Marrakesh Medina example taught me was just how easily my system 1 kicked in when under incredible pressure and ‘cognitive load’.  No wonder time-pressured research tasks work so well in terms of forcing out those natural cognitive biases that come into play. 

I might not be going back to Marrakesh any time soon, but I will at least take more effort to recognise my own decision-making biases going forwards.  And next time, perhaps I’ll take a calculator with me for the exchange rate issue. 

 

Laura Morris, Director

Chris Handford