I am half way through Daniel Kahnemans’ extraordinary Thinking Fast and Slow. Kahneman is one of the most important, perhaps the most important, thinker of the late 20th century in the field of decision-research, a growing field that concerns, well, how we make decisions, both personal and professional. Kahneman has either taught or influenced an entire generation of individuals working in behavioral psychology and finance. More popular writers, such as Steven Levitt, Dan Ariely, Richard Thaler, and one of my favorites, Daniel Gilbert, stand directly on his shoulders.
Kahneman’s book, while intended for public consumption, is not nearly as accessible to the average reader as are the books by the authors noted above. But for anyone who wishes to truly grasp the depths of this man’s understanding of how flawed our decision mechanisms can be, this book is a must-read.
“What You See Is All There Is” is a basic concept that Kahneman returns to over and over again in his book and it informs many of the cognitive biases he explores. WYSIATI basically states that in making judgements, we are unduly-influenced by the experiences we have had, the stories that we make up to explain our experiences, and whatever information we can see and hear around us. [UPDATE: And equally importantly, we ignore the possibility that any other information, outside of what we have at hand, exists or is relevant.] This is essentially our intuition at work, and according to Kahenman, intuition drives most of what we do. Much of the time, it is a very effective system. But, intuition can and does lead us wildly astray, without warning. How (and a little of why) it does so, is the meat of the book.