Kahneman Discusses Rational, Irrational Thinking

Daniel Kahneman (Photo: Office of Communications)

In the Q&A session of his recent talk on campus, Nobel laureate and emeritus professor Daniel Kahneman lightheartedly quipped that if we expect Princeton students to graduate as rational beings, “We are doomed.” He qualified the statement by adding that everyone has incorrect intuitions and that they prevent people from being fully rational.

Kahneman discussed his work and peculiarities of the mind Feb. 10 at McCosh 50, delivering this year’s Stafford Little Lecture. The talk drew on Kahneman’s best-selling book Thinking, Fast and Slow.

Kahneman asked the audience how many crimes occur in a year in Michigan and how many crimes occur in a year in Detroit. It was not uncommon for people who were asked the questions separately to answer a larger number for Detroit than for Michigan, he said. Revealing lapses in logic with similar examples, he said that people are irrational and “make systematic mistakes.”

When discussing his work on judgment and decision-making, Kahneman pointed out that he and his late colleague Amos Tversky were lucky to pick the problem and format that they chose for their research. The paper from their research led to the development of prospect theory, which earned Kahneman the 2002 Nobel Prize in economics. He told the audience he believes the single-question format made the paper “very easy to read” and ultimately helped the paper spread across disciplines.