Instructions:
Thinking, Fast and Slow is a best-selling book published in 2011 by Nobel Memorial Prize in Economic Sciences laureate Daniel Kahneman. It was the 2012 winner of the National Academies Communication Award for the best creative work that helps the public understanding topics in behavioral science, engineering, and medicine. The book summarises research that Kahneman conducted over decades, often in collaboration with Amos Tversky.
It covers all three phases of his career: His early days working on cognitive biases, his work on prospect theory, and his later work on happiness.
The central thesis is a dichotomy between two modes of thought:
“System 1” is fast, instinctive, and emotional;
“System 2” is slower, more deliberative, and more logical.
The book delineates cognitive biases associated with each type of thinking, starting with Kahneman’s own research on loss aversion. From framing choices to people’s tendency to replace a difficult question with one which is easy to answer, the book highlights several decades of academic research to suggest that people place too much confidence in human judgment.
You are required to write an essay to discuss the contents of this title and its implications on Finance.
Assessment Specification:
Essay Content (Executive Summary can be excluded)
- Introduction
- Concepts, theories, definitions
- Examples/illustrations/application
- A critical discussion of the question with the support of evidence
- Conclusion