Tuesday, December 13, 2016

New Book on Kahneman and Tversky from the Author of "Moneyball"

A few days ago, I posted the Riddler's Puzzle and discussed some related concepts, including Tversky and Kahneman's concept of loss aversion, where we place more value on (and work harder to avoid) a loss of a certain magnitude than a gain of the same magnitude. Today I learned that Michael Lewis, author of Moneyball has written a book about these two men and their unlikely friendship, called The Undoing Project. Their work is considered the foundation of the field of behavioral economics, and in fact, Kahneman won the Nobel Prize in economics in 2002. Lewis offers some background on these two men:
During their joint waking hours, they could usually be found together. Danny was a morning person, and so anyone who wanted him alone could find him before lunch. Anyone who wanted time with Amos could secure it late at night. In the intervening time, they might be glimpsed disappearing behind the closed door of a seminar room they had commandeered. From the other side of the door you could sometimes hear them hollering at each other, but the most frequent sound to emerge was laughter. Whatever they were talking about, people deduced, must be extremely funny. And yet whatever they were talking about also felt intensely private: Other people were distinctly not invited into their conversation. If you put your ear to the door, you could just make out that the conversation was occurring in both Hebrew and English. They went back and forth—Amos, especially, always switched back to Hebrew when he became emotional.

Danny was always sure he was wrong. Amos was always sure he was right. Amos was the life of every party; Danny didn’t go to the parties. Amos was loose and informal; even when Danny made a stab at informality, it felt as if he had descended from some formal place. With Amos you always just picked up where you left off, no matter how long it had been since you last saw him. With Danny there was always a sense you were starting over, even if you had been with him just yesterday. Amos was tone-deaf but would nevertheless sing Hebrew folk songs with great gusto. Danny was the sort of person who might be in possession of a lovely singing voice that he would never discover. Amos was a one-man wrecking ball for illogical arguments; when Danny heard an illogical argument, he asked, What might that be true of? Danny was a pessimist. Amos was not merely an optimist; Amos willed himself to be optimistic, because he had decided pessimism was stupid. When you are a pessimist and the bad thing happens, you live it twice, Amos liked to say. Once when you worry about it, and the second time when it happens.
The article chronicles many of the milestones in the friendship of these two men: from rivalry early in their careers, to collaborators, to the time they served together in the Israeli army, and beyond. I'm definitely adding this book to my reading list!

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