Thinking, fast and slow
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‘Thinking, fast and slow’, authored by Daniel Kahneman, is a thinker’s collective born out of the dedicated efforts done in the domain of thinking with his close companion Amos Tversky. Together they had been chronicling the biases, fallacies and errors in thinking, decision making and prediction processes through numerous papers and research. The very research takes form with lucidity when Daniel Kahneman along with providing rich vocabulary in understanding the thinking processes simultaneously gives an approach to diagnose the faults properly. Kahneman & Tversky led serious effort in developing a powerful research based methodology through controlled experiments to study the thinking process. The distinction of the process much simplified by the straightforward nomenclature- System 1 and System 2.
In this book, Kahneman introduces the two systems that drive the way we think and make choices. The fast system is intuitive and emotional, whereas the slow one is deliberative and logical. However, in the process of fast thinking there creeps the problem of biases, faults & stereotyping. Much of the discussion in the book is about the biases of intuition, although the author acknowledges the presence of intuition in one’s life as well justified, but reiterates that there is always room for bringing in more objectivity in judgments rather than rely on intuition. The progress one makes by observations makes the judgments more solid thus helping to take good decisions and tap into the benefits of slow thinking.
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Kahneman illustrates through heady usage of all important faculties in explaining the thinking phenomenon; he does this through treatment of psychology, philosophy, experiments, behavior and probability to understand various facets of the thinking process. For example in explaining the anchoring-effect, the author conducted a novel experiment, he rigged a wheel of fortune only to stop at number 10 and 65, the participants in the game were asked to write the number where the wheel stopped and were immediately asked two question regarding the number of African countries in the UN. Surprisingly the average estimates that hovered around 10 and 65 were 25% and 45% respectively. The participants in the game did not ignore the number generated by the wheel of fortune, this is anchoring-effect.
Explaining the statistical phenomenon Kahneman says that it took Francis Galton several years to figure out that correlation and regression are not two concepts but different perspective on the same concept. The book further delves into the illusion of understanding and validity. As regards to the problem of prediction (predictions that turn mostly incorrect) Kahneman is assertive of using some formula over the human judgment. He cites example of Princeton economist Orley Ashenfelter who has derived a three factor formula (weather, average temperature and amount of rain at harvest time) for predicting vintage wine prices. History has shown that his predictions were at least ninety times accurate. Ashenfelter simply (outstandingly) converted the conventional knowledge factors such as weather, temperature and rain that have effect upon the quality of wines and hence the prices. Such type of prediction coupled with conventional knowledge proves very essential rather then judgment or approximation.
Thinking, fast and slow – offers further insights into human tendency to judge events by calculating mental statistics and probabilities that are often wrong or far from the outcomes. We also tend to be biased when judging upon a case that may be totally unique but still trying to fit the same onto something that may have happened earlier. ?The author describes the circumstances where we can and cannot trust our intuitions. ?He offers practical and enlightening insights on applying thinking and techniques to guard against the mental faults. The author quotes the same as “Our comforting conviction that the world makes sense rests on a secure foundation: our almost unlimited ability to ignore our ignorance.”
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