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Farrar, Straus and Giroux

Thinking, Fast and Slow

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Major New York Times BestsellerMore than 2.6 million copies soldOne of The New York Times Book Review's ten best books of the yearSelected by The Wall Street Journal as one of the best nonfiction books of the yearPresidential Medal of Freedom RecipientDaniel Kahneman's work with Amos Tversky is the subject of Michael Lewis's best-selling The Undoing Project: A Friendship That Changed Our MindsIn his mega bestseller, Thinking, Fast and Slow, Daniel Kahneman, world-famous psychologist and winner of the Nobel Prize in Economics, takes us on a groundbreaking tour of the mind and explains the two systems that drive the way we think. System 1 is fast, intuitive, and emotional; System 2 is slower, more deliberative, and more logical. The impact of overconfidence on corporate strategies, the difficulties of predicting what will make us happy in the future, the profound effect of cognitive biases on everything from playing the stock market to planning our next vacation―each of these can be understood only by knowing how the two systems shape our judgments and decisions.Engaging the reader in a lively conversation about how we think, Kahneman reveals where we can and cannot trust our intuitions and how we can tap into the benefits of slow thinking. He offers practical and enlightening insights into how choices are made in both our business and our personal lives―and how we can use different techniques to guard against the mental glitches that often get us into trouble. Topping bestseller lists for almost ten years, Thinking, Fast and Slow is a contemporary classic, an essential book that has changed the lives of millions of readers. Read more


Publisher ‏ : ‎ Farrar, Straus and Giroux; 1st edition (April 2, 2013)


Language ‏ : ‎ English


Paperback ‏ : ‎ 499 pages


ISBN-10 ‏ : ‎ 0374533555


ISBN-13 ‏ : ‎ 57


Item Weight ‏ : ‎ 1.24 pounds


Dimensions ‏ : ‎ 5.51 x 1.46 x 8.23 inches


Best Sellers Rank: #699 in Books (See Top 100 in Books) #1 in Decision-Making & Problem Solving #1 in Business Decision Making #2 in Cognitive Psychology (Books)


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Top Amazon Reviews

    • Annotations on Kahneman's table of contents - a survey of logic and illogic
When you come late to the party, writing the 160th review, you have a certain freedom to write something as much for your own use as for other readers, confident that the review will be at the bottom of the pile. Kahneman's thesis is that the human animal is systematically illogical. Not only do we mis-assess situations, but we do so following fairly predictable patterns. Moreover, those patterns are grounded in our primate ancestry. The first observation, giving the title to the book, is that eons of natural selection gave us the ability to make a fast reaction to a novel situation. Survival depended on it. So, if we hear an unnatural noise in the bushes, our tendency is to run. Thinking slow, applying human logic, we might reflect that it is probably Johnny coming back from the Girl Scout camp across the river bringing cookies, and that running might not be the best idea. However, fast thinking is hardwired. The first part of the book is dedicated to a description of the two systems, the fast and slow system. Kahneman introduces them in his first chapter as system one and system two. Chapter 2 talks about the human energy budget. Thinking is metabolically expensive; 20 percent of our energy intake goes to the brain. Moreover, despite what your teenager tells you, dedicating energy to thinking about one thing means that energy is not available for other things. Since slow thinking is expensive, the body is programmed to avoid it. Chapter 3 expands on this notion of the lazy controller. We don't invoke our slow thinking, system two machinery unless it is needed. It is expensive. As an example, try multiplying two two-digit numbers in your head while you are running. You will inevitably slow down. NB: Kahneman uses the example of multiplying two digit numbers in your head quite frequently. Most readers don't know how to do this. Check out "The Secrets of Mental Math" for techniques. Kahneman and myself being slightly older guys, we probably like to do it just to prove we still can. Whistling past the graveyard - we know full well that mental processes slow down after 65. Chapter 4 - the associative machine - discusses the way the brain is wired to automatically associate words with one another and concepts with one another, and a new experience with a recent experience. Think of it as the bananas vomit chapter. Will you think of next time you see a banana? Chapter 5 - cognitive ease. We are lazy. We don't solve the right problem, we solve the easy problem. Chapter 6 - norms, surprises, and causes. A recurrent theme in the book is that although our brains do contain a statistical algorithm, it is not very accurate. It does not understand the normal distribution. We are inclined to expect more regularity than actually exists in the world, and we have poor intuition about the tail ends of the bell curve. We have little intuition at all about non-Gaussian distributions. Chapter 7 - a machine for jumping to conclusions. He introduces a recurrent example. A ball and bat together cost $1.10. The bat costs one dollar more than the ball. How much does the ball cost? System one, fast thinking, leaps out with an answer which is wrong. It requires slow thinking to come up with the right answer - and the instinct to distrust your intuition. Chapter 8 - how judgments happen. Drawing parallels across domains. If Tom was as smart as he is tall, how smart would he be? Chapter 9 - answering an easier question. Some questions have no easy answer. "How do you feel about yourself these days?" Is harder to answer than "did you have a date last week?" If the date question is asked first, it primes an answer for the harder question. Section 2 - heuristics and biases Chapter 10 - the law of small numbers. In the realm of statistics there is a law of large numbers. The larger the sample size, the more accurate the statistical inference from measuring them. Conversely, a small sample size can be quite biased. I was in a study abroad program with 10 women, three of them over six feet. Could I generalize about the women in the University of Maryland student body? Conversely, I was the only male among 11 students and the only one over 60. Could they generalize anything from that? In both cases, not much. Chapter 11 - anchors. A irrelevant notion is a hard thing to get rid of. For instance, the asking price of the house should have nothing to do with its value, but it does greatly influence bids. Chapter 12 - the science of availability. If examples come easily to mind, we are more inclined to believe the statistic. If I know somebody who got mugged last year, and you don't, my assessment of the rate of street crime will probably be too high, and yours perhaps too low. Newspaper headlines distort all of our thinking about the probabilities of things like in and terrorist attacks. Because we read about it, it is available. Chapter 13 - availability, emotion and risk. Continuation. Chapter 14 - Tom W's specialty. This is about the tendency for stereotypes to override statistics. If half the students in the University area education majors, and only a 10th of a percent study mortuary science, the odds are overwhelming that any individual student is an education major. Nonetheless, if you ask about Tom W, a sallow gloomy type of guy, people will ignore the statistics and guess he is in mortuary science. Chapter 15 - less is more. Linda is described as a very intelligent and assertive woman. What are the odds she is a business major? The odds that she is a feminist business major? Despite the mathematical impossibility, most people will think that the odds of the latter are greater than the former. Chapter 16 - causes trump statistics. The most important aspect of this chapter is Bayesian analysis, which is so much second nature to Kahneman that he doesn't even describe it. The example he gives is a useful illustration. * 85% of the cabs in the city are green, and 15% are blue. * A witness identified the cab involved in a hit and run as blue. * The court tested the witness' reliability, and the witness was able to correctly identify the correct color 80% of the time, and failed 20% of the time. First, to go to the point. Given these numbers, most people will assume that the cab in the accident was blue because of the witness testimony. However, if we change the statement of the problem so that there is a 20% chance that the blue identification of the color was wrong, but 85% of the cabs involved in accidents are green, people will overwhelmingly say that the cab in the accident was a green madman. The problems are mathematically identical but the opinion is different. Now the surprise. The correct answer is that there is a 41% chance that the cab involved in the accident was blue. Here's how we figure it out from Bayes theorem. If the cab was blue, a 15% chance, and correctly identified, an 80% chance, the combined probability is .15 * .8 = .12, a 12% chance If the cab was green, an 85% chance, and incorrectly identified, a 20% chance, the combined probability is .85 * .2 = .17, a 17% chance Since the cab had to be either blue or green, the total probability of it being identified as blue, whether right or wrong, is .12 + .17 = .29. In other words, this witness could be expected to identify the cab as blue 29% of the time whether she was right or wrong. The chances she was right are .12 out of .29, or 41%. Recommend that you cut and paste this, because Bayes theorem is cited fairly often, and is kind of hard to understand. It may be simple for Kahneman, but it is not for his average reader, I am sure. Chapter 17 - regression to the mean. If I told you I got an SAT score of 750 you could assume that I was smart, or that I was lucky, or some combination. The average is only around 500. The chances are little bit of both, and if I take a test a second time I will get a lower score, not because I am any stupider but because your first observation of me wasn't exactly accurate. This is called regression to the mean. It is not about the things you are measuring, it is about the nature of measurement instruments. Don't mistake luck for talent. Chapter 18 - taming intuitive predictions. The probability of the occurrence of an event which depends on a number of prior events is the cumulative probability of all those prior events. The probability of a smart grade school kid becoming a Rhodes scholar is a cumulative probability of passing a whole series of hurdles: studying hard, excelling in high school, avoiding drink and drugs, parental support and so on. The message in this chapter is that we tend to overestimate our ability to project the future. Part three - overconfidence Chapter 19 - the illusion of understanding. Kahneman introduces another potent concept, "what you see is all there is," thereinafter WYSIATI. We make judgments on the basis of the knowledge we have, and we are overconfident about the predictive value of that observation. To repeat their example, we see the tremendous success of Google. We discount the many perils which could have totally derailed the company along the way, including the venture capitalist who could have bought it all for one million dollars but thought the price was too steep. Chapter 20 - The illusion of validity. Kahneman once again anticipates a bit more statistical knowledge than his readers are likely to have. The validity of a measure is the degree to which an instrument measures what it purports to measure. You could ask a question such as whether the SAT is a valid measure of intelligence. The answer is, not really, because performance on the SAT depends quite a bit on prior education and previous exposure to standardized tests. You could ask whether the SAT is a valid predictor of performance in college. The answer there is that it is not very good, but nonetheless it is the best available predictor. It is valid enough because there is nothing better. To get back to the point, we are inclined to assume measurements are more valid than they are, in other words, to overestimate our ability to predict based on measurements. Chapter 21 - intuitions versus formulas. The key anecdote here is about a formula for predicting the quality of a French wine vintage. The rule of thumb formula beat the best French wine experts. Likewise, mathematical algorithms for predicting college success are as least as successful, and much cheaper, than long interviews with placement specialists. Chapter 22 - expert intuition, when can we trust it? The short answer to this is, in situations in which prior experience is quite germane to new situations and there is some degree of predictability, and also an environment which provides feedback so that the experts can validate their predictions. He would trust the expert intuition of a firefighter; there is some similarity among fires, and the firemen learns quickly about his mistakes. He would not trust the intuition of a psychiatrist, whose mistakes may not show up for years. Chapter 23 - the outside view. The key notion here is that people within an institution, project, or any endeavor tend to let their inside knowledge blind them to things an outsider might see. We can be sure that most insiders in Enron foresaw nothing but success. An outsider, having seen more cases of off-balance-sheet accounting and the woes it can cause, would have had a different prediction. Chapter 24 - the engine of capitalism. This is a tour of decision-making within the capitalist citadel. It should destroy the notion that there are CEOs who are vastly above average, and also the efficient markets theory. Nope. The guys in charge often don't understand, and more important, they are blind to their own lack of knowledge. Part four - choices This is a series of chapters about how people make decisions involving money and risk. In most of the examples presented there is a financially optimal alternative. Many people will not find that alternative because of the way the problem is cast and because of the exogenous factors. Those factors include: Marginal utility. Another thousand dollars is much less important to a millionaire than a wage slave. Chapter 26 - Prospect theory: The bias against loss. Losing $1000 causes pain out of proportion to the pleasure of winning $1000. Chapter 27 - The endowment effect. I will not pay as much to acquire something as I would demand if I already owned it and were selling. Chapter 28 - Bad Events. We will take unreasonable risk when all the alternatives are bad. Pouring good money after bad, the sunk cost effect, is an example. Chapter 29 - The fourfold pattern. High risk, low risk, win, lose. Human nature is to make choices which are not mathematically optimal: buying lottery tickets and buying unnecessary insurance. Chapter 30 - rare events. Our minds are not structured to assess the likelihood of rare events. We overestimate the visible ones, such as tsunamis and terrorist attacks, and ignore the ones of which we are unaware. Chapter 31 - Risk policies. This is about systematizing our acceptance of risk and making policies. As a policy, should we buy insurance or not, recognizing that there are instances in which we may override the policy. As a policy, should we accept the supposedly lower risk of buying mutual funds, even given the management fees? Chapter 32 - keeping score. This is about letting the past influence present decisions. The classic example is people who refuse to sell for a loss, whether shares of stock or a house. Chapter 33 - reversals. We can let a little negative impact a large positive. One cockroach in a crate of strawberries. Chapter 34 - Frames and reality. How we state it. 90% survival is more attractive than 10% mortality. Part V. Two selves: Experience and memory Our memory may be at odds with our experience at the time. Mountain climbing or marathon running are sheer torture at the time, but the memories are exquisite. We remember episodes such as childbirth by the extreme of pain, not the duration. Lift decision: do we live life for the present experience, or the anticipated memories? Are we hedonists, or Japanese/German tourists photographing everything to better enjoy the memories? ... show more
Reviewed in the United States on March 15, 2012 by Graham H. Seibert
    • Required reading for educated people, but falls short as a model of mind
This is an invaluable book that every person who considers him/herself educated should read - even study. Indeed, it is a scandal that mastering the material in this book isn't considered an essential component of a high school education. The author was awarded the Nobel in Economics for his work on what he calls decision theory, or the study of the actual workings of the typical human mind in the evaluation of choices, and the book itself presents the findings of many decades of psychological studies that expose the endemic fallacious thinking that we are all prone to, more or less. The lives of all of us could be improved by lessons learned from this book, not just individually, through self-education, but also on the large scale, if the large scale decision makers in this society in and out of government could be educated as well. In fact, it is largely because these large scale decision makers are no better than the rest of us in their ability to think straight and plan well, that society is as screwed up as it is, and that essentially all of its institutions are diseased and corrupt. The lesson there, however, is that decision making needs to be returned to the individual - that the powers that be need to be deprived of their powers to mess up the lives of the rest of us. Despite the many virtues of this book - it is well-written, engaging, and its academic author reasonably restrained in the tendencies of his tribe to blathering in abstractions - it is a bit disappointing at the very end, when the author proves unable to synthesize all his material into a comprehensive theory of the thinking, and deciding mind - or at least into a set of carefully formulated principles that provide a succinct summary of the principles of human thinking, both typical and ideal. Kahneman uses throughout a construct that implies that we are of two minds: System 1 is the fast-thinking, intuitive, mind, prone to jumping to conclusions; while System 2 is the slow-thinking analytical mind, that is brought into play, if at all, only to critique and validate the conclusions that we have jumped to. System 2, we are told, is lazy, and if often just rubber-stamps the snap judgements of System 1, or if pressed, rationalize them, instead of digging critically as well as constructively into the complex underpinnings of the material and sorting them out as best it can. Instead of working this construct up into a comprehensive model of mind, K merely uses it as a loose schema for representing the kinds of thinking thought to underlie the results derived from the many psychological experiments that he here reports on. This neglect raises the question at many points as to just how well the experimenters have really understood the thinking that underlies the behavior of their subjects. But this, I am sorry to say, is a weakness of virtually all psychological experimentation, which is still just beginning to come to grips with the complexity and varieties of cognitive style of the human mind. What Kahneman does do, however, is to provide convenient labels for many characteristic types of fallacious thinking, although again, the exact role of System 1 and System 2, and their interaction, is inadequately explicated. Instead, towards the end of the book, another, somehow related, but nominally independent theme is developed: the disturbing divergence between the experiencing self and the remembering self. This is in itself such an interesting and important idea, so pregnant with both psychological and philosophical implications, that it could have used a fuller treatment, and again, there is no coherent integration of this theme with the System1/System2 construct. The idea here is that our present experience includes our most salient memories of previous experiences - for example the highlights of past vacations, or out of the ordinary episodes of our lives. Somewhat surprisingly, though, what we remember is a systematic distortion of the actual experience. Our memory collapse the duration of various aspects of our experience and highlights only the peak moment(s) and the final moments, perhaps with a nod toward the initial presentation of the experience. And this systematic distortion of the actual experience in all its fullness, can lead us to make irrational and detrimental choices in deciding whether to repeat the experience in the future. Thus, a bad ending to an otherwise wonderful experience can spoil the whole thing for us in memory, and cause us to avoid similar experiences in the future, even though by simply anticipating and improving the ending we might make the whole experience as wonderful as most of the original was. Likewise, subjects in experiments involving either long durations of pain, or much shorter episodes of pain with a higher peak, were consistently more averse to the latter rather than the former - or they overemphasized the way these presentations ended as a factor in judging them as a whole. These are important findings that go the heart of the question of how best to steer our course through life, but here is the only attempt at integration of this remembering vs experiencing self theme, and the System 1/ System 2 theme that I find in the final chapter, Conclusions: "The remembering self is a construction of System 2. However, the distinctive features of the way it evaluates episodes and lives are characteristics of our memory. Duration neglect and the peak-end rule originate in System 1 and do not necessarily conform to the values of System 2". There is more here, but it merely repeats the earlier analysis of the relevant experiments. No evidence is presented as to the respective roles of System 1 and System 2 with respect to the laying down of memory, to its decay, or with respect to a recently discovered phenomenon: memory reconsolidation. Nor is any account taken of what has been learned, much of it in recent decades, about the interactions between short, intermediate, and long term memory, or any of the radically different modalities of episodic (picture strip) and semantic (organized, abstracted) memory. Consequently, Kahneman's vague reference to the "characteristics of our memory" is essentially a ducking of the question of what the remembering self is. I think that at best, the finding of the replacement of the original experience by an abstract predicated on peak-end bias is an exaggeration, though there's no question that "duration neglect" is in operation, and a good thing too, unless K means by "duration neglect" not just the stretches of minimally changing experience (which have little memorial significance anyway, but even the consciousness of how long the edited out parts were (this distinction was never made in Chapter 35, where the theme of the remembering vs. the experiencing self is first taken up). Speaking for myself anyway, I have a much fuller memory of my most important experiences than Kahneman seems to indicate. Naturally the highlights are featured, but what I tend to remember are representative moments that I took conscious note of at the time, as though making a psychological photograph. I remember these moments also because I bring them up from time to time when I'm thinking about that experience. For example, I'm thinking now of a long distance race I did in 2014 (a very tough half-marathon, with almost 2000' of climbing). I remember: the beginning section as well as the ending section; each of the rest stations; certain moments of each of the major hill climbs; at least one moment from each of the descents; and a number of other happenings during the almost three hour event. For me in this race, the peak experience occurred right at the end, when I all but collapsed, yet managed to stagger to the finish line. That ending does naturally come first to mind as a representation of the entire event, but it is merely the culmination of a long and memorable experience with many moving parts, and if I want, my remembering self can still conjure up many other moments, as well as a clear sense of the duration of each of the sections of the course. Over many years most memories fade, and it's certainly reasonable to suppose that in extreme cases, where they are all but forgotten, only a single representative moment might be retained. However, if we can say anything for sure about memory it is this: we remember what we continue to think of and to use, and we do that precisely because this material has continuing importance to us. The recent research in memory reconsolidation tells us that when we do bring up memories only occasionally, we reinforce them, but we also edit and modify them to reflect our current perspectives, and sometimes we conflate them with other seemingly related knowledge that we've accrued. We are thus prone to distort our own original memories over time, in some cases significantly, but we may still retain much more of the original experience that just the peak and the end, and if we do reinterpret our memories in the light of more recent experience, that's not necessarily a bad thing. In any case, the memories that occur in the present may be said to be a joint project of the experiencing as well as the remembering self, which rather erodes the whole Two Selves concept that Kahneman first posited. I do not mean to criticize the valuable evidential material in the book, and in general I think that Kahneman, and the other researchers and thinkers whom he quotes, have drawn reasonable conclusions from the experiments they report on. But ultimately, the book, as well as the fields both of psychology and brain neurophysiology suffer both in coherence and meaningfulness because they aren't predicated on a more comprehensive theory of mind. It's the old story in science, first formulated by Karl Popper in his 1935 book, The Logic of Scientific Discovery: unless we approach the data with an hypothesis in mind - unless, indeed, we seek out data likely to be relevant to a particular hypothesis, we're not going to make any enduring progress in understanding that data in a comprehensively meaningful way, let alone be able to make falsifiable deductions about elements of the system for which we have at present no data. Popper's quotation from the German philosopher Novalis comes to mind - "Theories are nets: only he who casts will catch." In the final, "Conclusions", chapter, K caricatures the abstract economists' model of homo econimicus (man as a rational optimizer of his utility), contrasting it with the more sophisticated and experientially grounded model of psychologists such as himself. In keeping with his penchant for framing (or spinning) his presentation favorably to his own perspective, he calls the economists' model "Econ", and his own "Human". In fact, "Econ" was never meant to represent man in all his humanity, and Kahneman's Economics Nobel, recognizing his decision theory contributions to economics, was preceded by many other Nobels to economists who had been expanding the concept of the economic actor into psychological territory for decades. In fact, the essential view of the Austrian economists dating from the 1920s (von Mises, Hayek, and their predecessors) is that economics is in the end wholly dependent on psychology because it is predicated on the unknowable, unquantifiable subjective value preferences of humans, acting individually and in concert. Cautious generalizations can perhaps be made about human psychology in general, but I think that on the whole the Austrians have been a bit wiser in their restraint than Kahneman and his many, and mostly lesser, pop psychology compatriots have proved in their often sensationalist extrapolations from lab experiments. Here is an example, I think of Kahneman over-reaching. He speaks repeatedly of the laziness of System 2, and its foot dragging reluctance to get involved in the thinking process, but in the real world, snap judgements are good enough for immediate purposes, and the better part of rationality may be to go with one's fast thinking intuitive System 1: indeed, Kahneman acknowledges this himself in passing, both in his beginning and his ending, but this isn't enough to counterbalance the overall argument of his book. Kahneman also, in his final chapter, speculatively extends his findings into the political sphere (his liberal Democratic Party bias has already been made clear by gratuitous and somewhat annoying usage of salient modern politicians in examples), but not to any great effect. Kahneman advocates "libertarian paternalism" consisting of government programs that people are enrolled in automatically unless they opt out by checking a box on forms - thus manipulating the presentation frame so as to trick them into signing on to what some government bureaucrat thinks is good for them. Of course, as long as people are allowed to opt out, one can't call the choice here anything but libertarian, though to be consistent with their socialist mores, liberals like Kahneman really ought to object to such practices as being manipulative advertising. This libertarian finds nothing objectionable about the way such a choice might be presented - after all, the average man, if adequately educated and prepared for the real world, should have no trouble seeing through the frames. What is not only paternalistic, but totalitarian in spirit, is the extortion of taxpayer money to finance such government programs in the first place. Somehow, it fails to occur to Kahneman that most people could be trained to recognize and avoid fallacious thinking during all those years of enforced and mostly wasteful schooling - just as most people can be trained to recognize the Müller-Lyer illusion for what it is. IMO every high school graduate should be required to learn to recognize and avoid the paradigm cases of fallacious thinking presented in Thinking, Fast, and Slow, and this material could profitably be expanded to cover the many rhetorical tricks used by the manipulators and spinmeisters, both public and private, who batten off of our society. With such training in critical thinking, and with the reintroduction of enough honest and rigor to begin high school graduates up to the 12th grade reading and writing proficiencies that were routine in the 1950s, the need for college as life preparation would be altogether obviated, and most young people could avoid wasting their early years in college, piling up debt, and get on with their work and/or their self-education, as they chose. ... show more
Reviewed in the United States on August 31, 2015 by John B. Robb

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