The Public Interest

Illusions and mirages in public policy

Richard H. Thaler

Fall 1983

LIKE most people, I have always found optical illusions fascinating. Figure I is a scale drawing of the worlds largest man-made optical illusion-the Gateway Arch in St. Louis. Although it appears to be at least 50 percent taller than it is wide, the height and width are actually equal. This optical illusion is an example of what I will call “judgmental illusions”: Somehow the mind is fooled into making an error of judgment. We all erroneously judge the arch’s height to be greater than its width.

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