Is Noise Just a Cost?

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Wen: There is one condition under which noise is very useful, and that if there is a selection process. But say it were always transparent, who would be the winners or losers from a given decision? Wen: Wouldn't we be too emotional, too polarized, engaging in too much rent seeking? And having an ambiguity as to cause and effect is in part what allows us to get along with each other?

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You might be surprised by what occupies Daniel Kahneman’s thoughts. “You seem to think that I think of bias all the time,” he tells Tyler. “I really don’t think of bias that much.” These days, noise might be the concept most on Kahneman’s mind. A forthcoming book, coauthored with Cass Sunstein and “a brilliant Frenchman you haven’t heard of” is about how random variability affects our decision-making. And while we’ve spent a lot of time studying how bias causes error in judgment, Kahneman says, we aren’t thinking nearly enough about the problem of noise.

In November, Kahneman joined Tyler for a live conversation about bias, noise and more, including happiness, memory, the replication crisis in psychology, advice to CEOs about improving decision-making, superforecasters, the influence of Freud, working in a second language, the value of intuition, and why he can’t help you win arguments with a spouse.

Read a full transcript enhanced with helpful links.

Recorded November 12th, 2018 Other ways to connect

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