Michael Lewis's The Undoing Project:
Behavioral economics combines economics and psychology to assess patterns of conduct in the vast array of economic choices people typically make. The work of Israeli psychologists Daniel Kahneman and Amos Tversky paved the way for it. Their lives, collaboration, friendship as male soulmates and work all form the subject of Michael Lewis's book.
Lewis turns all all of this into compelling, even page turning, reading. I say that as someone fairly innumerate with little feel for mathematical psychology, statistics or economics.
Lewis tells great stories about these world class brainiacs. And gives a "For Dummies" course in some of their basic work but manages to make it an exciting story too as synthesized with their lives and deep, deep relationship, a love affair of a kind. The two so often become one, but just as often remain separate and individual, It's like getting inside a human dialectic, seeing it from the inside.
A few exemplifying details: they'd lock themselves inside a seminar room for hours, working together on one typewriter, a good day being when they got one sentence or maybe a paragraph or two done; people walking by the room would hear bursts of spontaneous conversation switching back between Hebrew and English English laced with continual loud laughing.
Tversky, a sabra, a military hero, loud, intellectually aggressive and singular--he simply did what he wanted, social graces be damned, was, every who met him said, the most brilliant person they'd ever met. He'd cut instantly to the core of any issue. His good working hours were between midnight and 4:00 am. Stanford offered him within the space of one day a full, chaired professorship for life. He was full of one liners, many of which Lewis reproduces. One of my favorites, I paraphrase, not now having the book at hand: "Research requires wasting of a lot of time." I did though note of what he said about metaphors in thinking:
....They replace genuine uncertainty about the world with semantic ambiguity. A metaphor is a cover-up...
Technically a sabra, Kahneman, born in Tel Aviv, grew up in Paris. Hs family ducked and dodged around southern France to evade the Nazis. After the war, his father dead, Kahneman's family made its way to Palestine.
Such an opposite in many ways to Tversky was Kahneman. He was obsessively messy to Tversky's anal neatness. He was introspective, anxious, a depressive, constantly self doubting and non combative. Tversky was an optimist. Kahneman wa a pessimist. Even though ideas poured out of him non stop, he worried that he'd run out of them, even though he never did.
Despite all those differences, they became one in their work. Dare I say it: they completed each other: Tversky, brilliantly mathematically oriented and logically rigorous tending to the mathematical in psychology, Kahneman, mercurially creative, highly imaginative and intellectually probing as well but inclining to the emotional and subjective in psychology. They come totally alive in Lewis's portraits of them.
They did ground breaking work in, broadly speaking, most broadly believe me, undoing the model in economics of man as a rational being making rational economic decisions based on incentives and disincentives. They showed that in judgment and decision making people behave irrationally, but that their irrationality can be systematized by the common recurrence of the same errors such that they're foretellable.
They categorized these errors as common heuristics or rules of thumb that actually involve the mind playing tricks on us in our illusion of rational analysis, such as, for simplistic examples, by overweighting the first thing in a sequence that occurs, "anchoring," or comparing what is being faced with what is most available to us in our experience, "availability." In line with that, one of Tversky's standard pieces of advice was that whenever possible never make a decision on the spot, always give yourself time, (say overnight) to think it over. So perhaps, not for nothing, did Kahneman, as it happens after Tversky's death, come out with his massive best seller “Thinking, Fast and Slow.”
Lewis has it that typically they undid conventional thinking in many disciplines and that Tversky, untutored in them, with just some basic information could soon hold his own at a minimum on discrete issues and often come to understand the issues better than his "tutor." So not for nothing did Kahneman, a psychologist--Tversky having died--get a Noble Prize in economics for their revolutionary work on the irrationality in judgment and decision making in economic choices.
Lewis traces what finally led to their "separation" as time went on and Tversky got the lion's share of the recognition and plaudits and tended to internalize it all to Kahneman's growing dissatisfaction.
All in all, Lewis's book is a joy to read, for its human interest in the way he embeds what he writes in a story, for his graceful, clear prose and his accessible explanation of the some of the work of these two great scientists.
Most highly recommended.