Sunday, 17 February 2013

Kahneman's sideswipes at traders and political scientists

I'm reading the Kahneman book. It is a really great piece of popular science - a deep and broad overview of the field. It has been reviewed in the JEL with the title Barbarians At The Gates (as in, psychologists at the gates of economics... a reversal of the usual position!)

Along with the psychological theory, there are some tangential insights into the financial crisis, as revealed by Kahneman and Thaler's study of a firm of stock market traders. Context: they discover that the performance of a trader's portfolio in one year is completely unrelated to performance the next year. Now read on:


And he seemed like such a nice man

Embarrassingly, he also has opinions about my own fine profession, referencing Philip Tetlock's famous study of, ahem, "experts":