THINKING FAST AND SLOW

June 13, 2017


Thinking Fast and Slow is a remarkably well-written book by Dr. Daniel Kahneman. Then again why would it not be?  Dr. Kahneman is a Nobel Laureate in Economics. Dr. Kahneman takes the reader on a tour of the mind and explains the two systems that drive the way we think.   System One (1) is fast, intuitive, and emotional.  System Two (2) is considerably slower, more deliberative, and more logical.   He engages the reader in a very lively conversation about how we think and reveals where we can and cannot trust our intuitions and how we tap into the benefits of slow thinking.  One great thing about the book is how he offers practical and enlightening insights into how choices are made in both the corporate world and our personal lives.  He provides different techniques to guard against the mental glitches that often get us into trouble.  He uses multiple examples in each chapter that demonstrate principles of System One and System Two.  This greatly improves the readability of the book and makes understanding much more possible.

Human irrationality is Kahneman’s great theme. There are essentially three phases to his career.  First, he and he coworker Amos Tversky devised a series of ingenious experiments revealing twenty plus “cognitive biases” — unconscious errors of reasoning that distort our judgment of the world. Typical of these is the “anchoring effect”: our tendency to be influenced by irrelevant numbers that we happen to be exposed to.  (In one experiment, for instance, experienced German judges were inclined to give a shoplifter a longer sentence if they just rolled a pair of dice loaded to give a high number.) In the second phase, Kahneman and Tversky showed that people making decisions under uncertain conditions do not behave in the way that economic models have traditionally assumed; they do not “maximize utility.” Both researchers then developed an alternative account of decision making, one more faithful to human psychology, which they called “prospect theory.” (It was for this achievement that Kahneman was awarded the Nobel.) In the third phase of his career, mainly after the death of Tversky, Kahneman delved into “hedonic psychology”: the science of happiness, its nature and its causes. His findings in this area have proven disquieting.   One finding because one of the key experiments involved a deliberately prolonged colonoscopy.  (Very interesting chapter.)

“Thinking, Fast and Slow” spans all three of these phases. It is an astonishingly rich book: lucid, profound, full of intellectual surprises and self-help value. It is consistently entertaining and frequently touching, especially when Kahneman is recounting his collaboration with Tversky. (“The pleasure we found in working together made us exceptionally patient; it is much easier to strive for perfection when you are never bored.”).  So, impressive is its vision of flawed human reason that the New York Times columnist David Brooks recently declared that Kahneman and Tversky’s work “will be remembered hundreds of years from now,” and that it is “a crucial pivot point in the way we see ourselves.” They are, Brooks said, “like the Lewis and Clark of the mind.”

One of the marvelous things about the book is how he captures multiple references.  Page after page of references are used in formulating the text.  To his credit—he has definitely done his homework and years of research into the subject matter propels this text as one of the most foremost in the field of decision making.

This book was the winner of the National Academy of Sciences Best Book Award and the Los Angeles Times Book Prize.  It also was selected by the New York Times Review as one of the ten (10) best books of 2011.

DANIEL KAHNEMAN:

Daniel Kahneman is a Senior Scholar at the Woodrow Wilson School of Public and International Affairs. He is also Professor of Psychology and Public Affairs Emeritus at the Woodrow Wilson School, the Eugene Higgins Professor of Psychology Emeritus at Princeton University, and a fellow of the Center for Rationality at the Hebrew University in Jerusalem.

He was awarded the Nobel Prize in Economic Sciences in 2002 for his pioneering work integrating insights from psychological research into economic science, especially concerning human judgment and decision-making under uncertainty. Much of this work was carried out collaboratively with Amos Tversky.

In addition to the Nobel prize, Kahneman has been the recipient of many other awards, among them the Distinguished Scientific Contribution Award of the American Psychological Association (1982) and the Grawemeyer Prize (2002), both jointly with Amos Tversky, the Warren Medal of the Society of Experimental Psychologists (1995), the Hilgard Award for Career Contributions to General Psychology (1995), and the Lifetime Contribution Award of the American Psychological Association (2007).

Professor Kahneman was born in Tel Aviv but spent his childhood years in Paris, France, before returning to Palestine in 1946. He received his bachelor’s degree in psychology (with a minor in mathematics) from Hebrew University in Jerusalem, and in 1954 he was drafted into the Israeli Defense Forces, serving principally in its psychology branch.  In 1958, he came to the United States and earned his Ph.D. in Psychology from the University of California, Berkeley, in 1961.

During the past several years, the primary focus of Professor Kahneman’s research has been the study of various aspects of experienced utility (that is, the utility of outcomes as people actually live them).

CONCLUSIONS: 

This is one book I can definitely recommend to you but one caution—it is a lengthy book and at times tedious.  His examples are very detailed but contain subject matter that we all can relate to.  The decision-making process for matters confronting everyone on an everyday are brought to life with pros and cons being the focus.  You can certainly tell he relies upon probability theory in explaining the choices chosen by individuals and how those choices may be proper or improper.  THIS IS ONE TO READ.

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