5' - Thinking, Fast and Slow

The excerpts are taken from Daniel Kahneman's book Thinking, Fast and Slow, which explores the two systems of thinking in the human mind. System 1 is intuitive, fast, and automatic, while System 2 is analytical, slow, and deliberate. Kahneman argues that System 1 often makes judgments and choices based on heuristics, which are mental shortcuts that can lead to biases. He illustrates these biases with various examples, such as the availability heuristic, the anchoring effect, and the framing effect. The book further discusses prospect theory, a model of decision-making that explains how people evaluate gains and losses, and the endowment effect, which describes people's tendency to value something they own more highly than something they do not. Finally, the text examines the implications of the two-system model for decision-making in various contexts, including economics, risk assessment, and public policy.