Thinking, Fast and Slow

Real-world examples include organ donation rates under default 'opt-in' vs. 'opt-out' systems.

Probabilities are judged based on similarity to stereotypes, leading to neglect of base rates and sample size.

People irrationally categorize finances and persist in failing investments due to prior expenditures.

People are risk-averse with gains and risk-seeking with losses due to loss aversion and sensitivity to relative changes.

The endowment effect: Valuing owned goods higher than unowned equivalents due to anticipated loss.

Intuition tends to be more reliable when the environment is predictable and feedback is regular.

In high-stakes areas like hiring and stock trading, structured tools tend to outperform intuitive judgments.

Predictions often ignore the tendency for extreme values to regress to the average, skewing expectations.

The experiencing self lives in the moment, feeling pleasure or pain as it happens, whereas the remembering self narrates stories about the past, coloring our perceptions of life based on select moments.

The peak-end rule teaches us that we often judge experiences not by their overall duration, but by the most intense moments and how they conclude.