Thinking, Fast and Slow

The main obstacle is that subjective confidence is determined by the coherence of the story one has constructed, not by the quality and amount of the information that supports it.

His observation was astute and correct: occasions on which he praised a performance were likely to be followed by a disappointing performance, and punishments were typically followed by an improvement. But the inference he had drawn about the efficacy of reward and punishment was completely off the mark. What he had observed is known as regression

As we have seen, rationality is generally served by broader and more comprehensive frames, and joint evaluation is obviously broader than single evaluation.

Richard Thaler found many examples of what he called the endowment effect, especially for goods that are not regularly traded. You can easily imagine yourself in a similar situation.

The statement “I had a premonition that the marriage would not last, but I was wrong” sounds odd, as does any sentence about an intuition that turned out to be false. To think clearly about the future, we need to clean up the language that we use in labeling the beliefs we had in the past.

less.” The tendency to see patterns in randomness is overwhelming—certainly more impressive than a guy making a study.

He concludes that stories of success and failure consistently exaggerate the impact of leadership style and management practices on firm outcomes, and thus their message is rarely useful.

Brain recordings also indicate that buying at especially low prices is a pleasurable event.

affect heuristic, where judgments and decisions are guided directly by feelings of liking and disliking, with little deliberation or reasoning.