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Thinking, Fast and Slow in Economic Sciences

Economic Sciences The book covers Kahneman's decades of study, which he often collaborated on with Amos Tversky.

The Economic Sciences best-selling book Thinking, Fast and Slow is about how to think faster and slower. Daniel Kahneman, the Nobel Laureate in Economic Sciences, wrote a book in 2011.

The National Academies Communication Award Economic Sciences for the outstanding creative effort that aids public comprehension of behavioral science, engineering, and medicine subjects was given to it in 2012. 

The book covers Kahneman’s decades of study, which he often collaborated on with Amos Tversky.

It spans his whole career, from his early work on cognitive biases to his later work on prospect theory to his previous work on happiness.

During the psychological replication crisis, the integrity of many of the priming research referenced in the book has been called into doubt. In contrast, the results of Kahneman’s studies have been repeated.

The primary argument is that there is a distinction between two modes of thought: “System 1” is quick, instinctual, and passionate, while “System 2” is slower, more deliberate, and rational. Starting with Kahneman’s study on loss aversion, the book delineates rational and non-rational motivations/triggers connected with each type of thinking process, as well as how they complement each other.

The second portion explains why people have trouble thinking quantitatively. It starts by describing several scenarios in which we make binary judgments or fail to connect acceptable probability with outcomes. Kahneman uses the notion of heuristics to explain this occurrence. In their 1974 essay, Judgment Under Uncertainty: Heuristics and Biases, Kahneman and Tversky explored this problem. 

System 1 thinking, according to Kahneman, entails connecting new information with old patterns or concepts rather than developing new designs for each recent encounter.

When a youngster sees a circle for the first time, he or she may imagine an octagon since he or she has only seen forms with straight edges. When faced with a new disagreement, a judge confined to heuristic thinking would only be able to think of comparable past situations rather than evaluating the case’s unique characteristics. The theory not only explains the statistical problem but also explains human prejudices.

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