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Daniel Kahneman On Misery, Memory, And Our Understanding Of The Mind

Economic theory rests on a simple notion about humans: people are rational. They seek out the best information. They measure costs and benefits, and maximize pleasure and profit. This idea of the rational economic actor has been around for centuries.

But about 50 years ago, two psychologists shattered these assumptions. They showed that people routinely walk away from good money. And they explained why, once we get in a hole, we often keep digging.

The methods of these psychologists were as unusual as their insights. Instead of writing complex theorems, Daniel Kahneman and Amos Tversky spent hours together...talking. They came up with playful thought experiments. They laughed a lot.

"We found our mistakes very funny," recalls Kahneman. "What was fun was finding yourself about to say something really stupid."

The insights that Kahneman developed with Tversky, who passed away in 1996, transformed the way we understand the mind. That transformation also had philosophical implications.

"The stories about the past are so good that they create an illusion that life is understandable, and they create an illusion that you can predict the future," Kahneman says.

Daniel Kahneman won the Nobel prize in 2002, and over the past 99 episodes of Hidden Brain, we've drawn extensively on research inspired by his work. This week, we celebrate our 100th episode by interviewing Kahneman about judgment, memory, and the mind itself. He spoke with us before a live audience at NPR headquarters in Washington, D.C.

Hidden Brain is hosted by Shankar Vedantam and produced by Parth Shah, Rhaina Cohen, Jennifer Schmidt, Matthew Schwartz, and Renee Klahr. Our supervising producer is Tara Boyle. Special thanks this week to Kara McGuirk-Allison. You can also follow us on Twitter @hiddenbrain, and listen for Hidden Brain stories each week on your local public radio station.

Copyright 2018 NPR. To see more, visit http://www.npr.org/.

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