Sunday, November 12, 2017

Book review. The Undoing Project: A friendship that changed our minds

I have recently read this 2017 book about the collaboration between two psychologists, Amos Tversky and Daniel Kahneman. The book is by Michael Lewis, a truly great storyteller. From his pen, the academic collaboration story of two social scientists becomes a love story and a thriller. I wouldn't ever imagine social science and behavioral economics could be this exciting. So I plan to read more of Michael Lewis's books: Flash Boys, The Big Short, Moneyball, The Blind Side, and Liar's Poker.

Here are some short notes from the book.

Danny Kahneman had a very tough childhood. His family survived (except the father) through Nazi prosecution and World War 2, and were able immigrate to Israel in 1948. He was a gifted child and starred in academia, although through out his life he was always had doubts about his talents and was always unsure of himself.

Amos Tversky was born in Israel and served in the Israel army for many years. He got educated at US for graduate school in psychology. He was very bright, which led to his colleagues coining an IQ test: "The faster you realized Tversky was smarter than you, the smarter you are."

The book contains many amazing quotes from Amos. When he was asked why/how he had become a psychologist, Amos replied: "The big choices we make are practically random. The small choices probably tell us more about who we are. Which field we go into may depend on which high school teacher we happen to meet. Who we marry may  depend on who happens to be around at the right time of life. On the other hand, the small decisions are very systematic. That I became a psychologist is probably not very revealing. What kind of psychologist I am may reflect deep traits."

Amos's early research on similarity of things was also very interesting, and the book explains this very nicely. Similarity is not like distance, because it does not necessarily have symmetry. People assess similarity essentially by making a list of features. The more noticeable features two objects share, the more similar they are. Note that, objects have varying number of noticeable features: New York has more of them than Tel Aviv. As a result, New York is not as much like Tel Aviv as Tel Aviv is like New York. Hence, similarity can be asymmetric. (In other words, similarity is like Bayesian subset comparison of features.) The book has a nice anecdote about how Amos instated that sometimes a lack of a feature is a feature: e.g., a three legged dog.

When Amos and Danny got together as colleagues, they started an epic collaboration streak investigating the irrational ways humans make decisions about risk. Their collaborative research started the behavioral economics field.

Their research shows a prime example of academic courage and creativity. They were able ask very original and daring questions and they were brave enough to pursue those questions and break ground in uncharted territory. An example of the kind of thought experiments they performed is the Asian disease problem which elegantly demonstrates the power of framing.

I will not divulge more about the collaboration of this duo and about the book. I enjoyed the book immensely and I strongly encourage you to read the book to learn about the collaboration story of these two great men. The book gives great insights about how to approach research as well.

Amos passed away in 1996 due to metastatic melanoma. Danny was awarded the 2002 Nobel Memorial Prize in Economic Sciences. You can listen to Danny talk here.

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