Most Popular Books by Daniel Kahneman

The assumption that utility is always maximized allows often surprising inferences about the nature of the desires that guide people''s ever-rational choices. This methodology has had many uses and undeniably has charm for economists, but it rests on the shaky foundation of an implausible and untestable assumption. In this paper we discuss a version of the utility maximization hypothesis that can be tested - and we find that it is false.

Many decisions about strategy require that senior executives make evaluative judgments on the basis of extensive, complex information. A disciplined, sequential approach can mitigate common errors and improve the quality of both one-off and recurrent decisions in an array of business domains. The process described in this article is easy to learn, involves little additional work, and (within limits) leaves room for intuition.

The study of intuitions and errors in judgment under uncertainty is complicated by several factors: discrepancies between acceptance and application of normative rules; effects of content on the application of rules; Socratic hints that create intuitions while testing them; demand characteristics of within-subject experiments; subjects'' interpretations of experimental messages according to standard conversational rules. The positive analyses of judgmental error in terms of heuristics may be supplemented by a negative analysis, which seeks to explain why the correct rule is not intuitively compelling. A negative analysis of non-regressive prediction is outlined. (Author).

In contrast to formal theories of judgment and decision, which employ a single notion of probability, psychological analyses of responses to uncertainty reveal a wide variety of processes and experiences, which may follow different rules. Elementary forms of expectation and surprise in perception are reviewed. A phenomenological analysis is described, which distinguishes external attributions of uncertainty (disposition) from internal attributions of uncertainty (ignorance). Assessments of uncertainty can be made in different modes, by focusing on frequencies, propensities, the strength of arguments, or direct experiences of confidence. These variants of uncertainty are associated with different expressions in natural language; they are also suggestive of competing philosophical interpretations of probability.