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sandygoldstein's review against another edition
4.0
This along with freakonomics is the only time economics has ever been interesting to me, finding how to account for the irrational nature of people in economics is actually fascinating and the different scenarios in this book were so memorable.
sam1972's review against another edition
2.0
Annoyingly passive-agressive and salty about not being taken seriously enough by economists. Mostly a repeat of other books in behavioral economics like Thinking Fast and Slow and Nudge.
The framing of people as irrational for things like loss aversion seems a little silly. Much of behavioral economics is done this way: the researcher imagines what a 'rational' action would be and then goes on to see if people do that, and, surprise surprise, they often don't. Yet that's a very low bar to clear. Hardly anyone that wasn't inculcated into the economists' rationalist framework assumes people act that way all the time.
This may be because they've accepted the classical economics definition of 'rational', where people are self-interested utility maximizers who always use the best possible strategy. But in reality, it may be more rational not to try to calculate explicit probabilities and utilities given the cost of aquiring information (even just the calorie cost of mental computation). A person with only limited access to a very slow computer, for example, might do better to use an approximate algorithm rather than the more precise one. There are multiple different strategies that may be their own kind of rational. Nor is it clear that we can call a person irrational if nobody could have predicted the outcome observed.
The book gives lots of examples of where people behave 'irrationality' according to that narrow conception. But its not clear whether these are cherry-picked, or representative of the majority of the ways people behave. What % of people's behavior is irrational? What % is rational? The author acknowledges that people aren't entirely rational or irrational, but doesn't seem to give much effort to providing a reliable estimate of which is more true of people. Given how many examples there are attempting to promote irrationality, it seems like the author believes humans are irrational 99% of the time, which seems a little extreme.
The framing of people as irrational for things like loss aversion seems a little silly. Much of behavioral economics is done this way: the researcher imagines what a 'rational' action would be and then goes on to see if people do that, and, surprise surprise, they often don't. Yet that's a very low bar to clear. Hardly anyone that wasn't inculcated into the economists' rationalist framework assumes people act that way all the time.
This may be because they've accepted the classical economics definition of 'rational', where people are self-interested utility maximizers who always use the best possible strategy. But in reality, it may be more rational not to try to calculate explicit probabilities and utilities given the cost of aquiring information (even just the calorie cost of mental computation). A person with only limited access to a very slow computer, for example, might do better to use an approximate algorithm rather than the more precise one. There are multiple different strategies that may be their own kind of rational. Nor is it clear that we can call a person irrational if nobody could have predicted the outcome observed.
The book gives lots of examples of where people behave 'irrationality' according to that narrow conception. But its not clear whether these are cherry-picked, or representative of the majority of the ways people behave. What % of people's behavior is irrational? What % is rational? The author acknowledges that people aren't entirely rational or irrational, but doesn't seem to give much effort to providing a reliable estimate of which is more true of people. Given how many examples there are attempting to promote irrationality, it seems like the author believes humans are irrational 99% of the time, which seems a little extreme.
julesjim's review against another edition
3.0
Lots of interesting information and thoughts, but I probably should have started by reading Nudge. This is basically the story of how Thaler came to co-write Nudge, his bestseller. Too much of the book is devoted to his bickering with other economists, small anecdotes, etc. I wanted to hear more about his findings and a bit less about the discovery path to them.
alicevicini's review against another edition
2.0
I had to read it for an exam at university so it wasn't really my favorite genre but it was ok.
Some parts were a little bit too technical and hard to understand but I guess it was because I'm not very good in economics and finance ahaha.
I admire the author for his work and the achievements of his life though!
Some parts were a little bit too technical and hard to understand but I guess it was because I'm not very good in economics and finance ahaha.
I admire the author for his work and the achievements of his life though!
bleary's review against another edition
5.0
Classical economics assumes that the economy is inherently rational - people make sensible decisions based on available data, and markets self-correct any errors.
Behavioural economics rejects this and instead points out that, to use a phrase that appears in this book, "THERE ARE IDIOTS. Look around."
Misbehaving is a great introductory to the behavioural model, laying out the case for an economic model that's driven by emotion and bias as much as it is by data and reason. It's also a semi-biography of Thaler's journey from cocky post-grad to respected economist and adviser to the Cameron-Clegg government, detailing all the arguments, dead ends and lucky breaks along the way.
It's hugely illuminating for non-economists, and a surprisingly funny book that made me laugh throughout. I've rarely laughed as deeply as I did at the chapter about the Univeristy of Chicago's economics department deciding how to allocate new offices.
Behavioural economics rejects this and instead points out that, to use a phrase that appears in this book, "THERE ARE IDIOTS. Look around."
Misbehaving is a great introductory to the behavioural model, laying out the case for an economic model that's driven by emotion and bias as much as it is by data and reason. It's also a semi-biography of Thaler's journey from cocky post-grad to respected economist and adviser to the Cameron-Clegg government, detailing all the arguments, dead ends and lucky breaks along the way.
It's hugely illuminating for non-economists, and a surprisingly funny book that made me laugh throughout. I've rarely laughed as deeply as I did at the chapter about the Univeristy of Chicago's economics department deciding how to allocate new offices.
tbauman's review against another edition
4.0
I enjoyed this book, but it occupies a weird ground between autobiography, history, and popular science book, and I'm not sure it totally works. A lot of good popular science books (like the classic "Thinking, Fast and Slow") have only a handful of strong ideas repeated frequently that you can easily remember after reading them. Thaler's work, to his credit, doesn't fit such a simple structure. The story of his life is amusing but not enthralling. There are a few interesting experiments about perception, but the main takeaway is that most of the assumptions of economics are wrong. If you're already interested in the topic, you'll learn some things and you might enjoy this book, but if you want to learn behavioral economics, you're better of looking elsewhere.