William Stewart Tod Professor of Psychology and Public Affairs Ph.D., Princeton University; Co-author, Scarcity

Here is a trivial fact about our mental lives. So trivial, it is rarely even noticed. And it is hard to talk about without sounding sophisticated. The post-modernists have explored versions of it, but the notion I mean to promote—the notion of “construal”—is painfully obvious. It refers to the fact that our attitudes and opinions and choices pertain to things not as they are in the world, but as they are represented in our minds.

Economic theorizing presumes that people choose between options in the world: Job A versus Job B, or Car A versus Car B. From the point of view of a psychologist, however, that presumption is really quite radical: When a person is presented with a choice between options A and B, she chooses not between A and B as they are in the world, but rather as they are represented by the 3-pound machine she carries behind the eyes and between the ears. And that representation is not a complete and neutral summary, but rather a selective and constructed rendering—a construal.

There is, of course, no way around it. The behaviorists tried to avoid it by positing that behaviors were direct responses to stimuli, that mental life didn’t interfere in relevant ways. But, clearly, that’s not the case. We now know a lot about our rich mental lives, which shape and mold what we experience, making construal not neutral. A food when it is 10% fat is less appetizing than when it is 90% fat free. A risky venture that entails some lives saved and others lost is a lot more appealing when our attention is directed towards the lives saved than the lives lost. Our attempts to elicit empathy for global catastrophes are ineffective—a phenomenon referred to as “psychic numbing”—partly because our construal processes are not able to trigger differential indignation for outcomes as a function of their gravity.

Visual illusions provide a compelling illustration, where our experience of the object simply does not conform to the actual object in the world. Susan Sontag famously observed that “to photograph is to frame, and to frame is to exclude.” In fact, the mind is a lot messier than a camera. We don’t merely choose where to look—our minds influence what we see. And they influence what we see both when we think fast and when we think slow; both when we respond impulsively, without conscious thought, and when we deliberately choose what to take seriously and what to ignore.

Construal lies at the core of behavioral economics. Violations of standard rationality assumptions arise not from stupidity, computational limitations or inattention, but from the simple fact that things in the world, depending on how they are described or interpreted, get construed differently, yielding inconsistent judgments and preferences.

Real world options, like automobiles, houses, job offers, potential spouses, all come in multiple attributes. How much weight we give each attribute is largely a function of where our attention is directed, our pet theories, what we expect or wish to see, the associations that come to mind. One rule of construal is that things are judged in comparative rather than absolute terms. How water feels to the hand depends on whether the hand had previously been in colder or warmer water. In the delivery room, a doctor’s decision of whether to perform a caesarian section depends on the gravity of immediately preceding cases.

Knowledge in the form of scripts, schemas, and heuristics, serves to make sense of stimuli in ways that transcend what is given. What we experience is determined not simply by the objective building blocks of the situation, but by what we know, care about, attend to, understand, and remember. And what we care about, attend to, and remember is malleable. In one study, participants were invited to play a Prisoner’s Dilemma game, referred to as either the Wall Street or the Community game. While the payoffs and set-up were identical, the mere label altered participants’ construal, changing their tendency to cooperate or to defect.

Psychological costs and subsidies also enter people’s construal, and are quite different from the financial costs and subsidies policy makers are typically concerned with. In one well-known study, when fines were introduced for picking up children late from daycare, parents were more likely to pick up their children late. Parents who had previously felt bad—had incurred a psychic cost—for showing up late now construed the fine as a contract—paying a fee entitled them to late pick-up.

Psychologists see it as an integral feature of human cognition, but if your aim is to influence behavior, construal presents a difficult challenge. The difference between success and failure often boils down to how things are construed. Although similar from an accounting point of view, Earned Income Tax Credit (EITC)—in contrast with TANF and other forms of welfare—has been an effective form of government assistance. This is attributed to the construal of EITC as just reward for labor, delivered in the form of a tax refund check, rather than a separate assistance payment. It is seen as an entitlement rather than welfare, designating beneficiaries as taxpaying workers, rather than “on the dole.”

Construal needs to be more widely appreciated because so much thinking and intuition, in policy and in the social sciences, tends to focus on actual circumstances as opposed to how they are construed. The words that make up this essay are just words. It’s partly their construal that will make some readers think they’re useful and others think they’re of little use.