Even when information is adequate, the act of choosing introduces its own distortions. The sunk cost fallacy drives people to continue failing projects because of past investment rather than future expected value; the diagnostic question is, "If I were starting fresh today, would I do this?" The planning fallacy systematically underestimates the time, cost, and risk of future tasks despite past experience to the contrary, because people focus on the specifics of the plan rather than reference-class data from similar past projects. Bent Flyvbjerg's reference-class forecasting, anchoring estimates on actual outcomes of similar prior cases, is the canonical remedy.
Optimism bias and the overconfidence effect make people believe their own futures will be better than average and trust their own judgments beyond their accuracy, with optimism bias present in roughly 80 percent of people. Outcome bias judges decisions by their result rather than by their quality at the time, distorting retrospectives; the standard counter is to separate process from outcome when reviewing decisions. Illusion of validity gives confidence in predictions built from coherent stories even when their accuracy is poor, while illusion of control, choosing one's own lottery numbers being the classic example, makes people overestimate influence over random events.
Choice architecture matters as much as the options themselves. Choice overload, illustrated by Sheena Iyengar's jam study (a 24-jam display drew more browsers but a 6-jam display produced about ten times more purchases), paralyzes decision-making and reduces satisfaction with whatever is chosen. The decoy effect, including The Economist's subscription pricing that boosted the combined offer from 16 to 84 percent, shows how adding an inferior option shifts preference. Reactance triggers when choice feels restricted, increasing desire for the lost option, while the Streisand effect ensures that attempts to suppress information amplify attention to it. Pre-filtering to a small set of finalists and evaluating options on their own merits are the standard mitigations.