Daniel Kahneman received the Nobel Memorial Prize in Economic Sciences for his work with Amos Tversky on Prospect Theory. He is a psychologist who has spent his career working on the psychology of judgment and decision-making, behavioral economics and hedonic psychology. Prospect Theory describes the way people make choices under uncertainty. Its basic premise is that people are loss-averse rather than risk-averse, a finding that challenges the conventional wisdom of expected utility theory.
Kahneman’s Thinking, Fast & Slow is wonderfully enlightening about the way the human mind works. While the author is known for the application of his work to the field of economics, decision-making under uncertainty impacts all aspects of human existence. This is a book that is full of fascinating and entertaining examples and studies. I was particularly struck by the clever construction of many of the psychological studies described in the book – they give new meaning to the adage, “simple is better.” You will enjoy reading this book and will gain insight into the workings of the human mind.