1min chapter

People I (Mostly) Admire cover image

27. Daniel Kahneman on Why Our Judgment is Flawed — and What to Do About It

People I (Mostly) Admire

CHAPTER

How Much of a Difference Do You Expect?

An insurance company ran an experiment to see if its underwriters operate in the same way. The idea was they produced some cases, presented those cases to settle down the underwriters. And each underwriter selected a premium that was appropriate to that risk. When asked how large do you expect the difference to be? It turns out it's five times larger than people had expected.

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