Daniel Kahneman, an Israeli-American psychologist known as an expert on behavioral economics, died on March 27 at the age of 90, according to a notice on the website of Princeton University.
Kahneman served as the Eugene Higgins Professor of Psychology Emeritus at the university. The notice did not list a cause of death.
Kahneman's “work on the psychology of judgement and decision-making laid some of the early foundations for the field of behavioral economics and for modern behavioral science and their applications to policy,” as exemplified by his 2011 book Thinking, Fast and Slow, the notice said.
He was awarded the Nobel Memorial Prize in Economic Sciences in 2002 for "having integrated insights from psychological research into economic science, especially concerning human judgment and decision-making under uncertainty,” according to Princeton's website. In 2013, Kahneman was awarded the Presidential Medal of Freedom by then-President Barack Obama.
Kahneman’s wife Anne Treisman, also a distinguished Princeton scholar, died in 2018.
A notice on the website of the Nobel Prize organization said Kahneman was born March 5, 1934 in Tel Aviv, British Mandate of Palestine (now Israel).
Kahneman was “a cognitive psychologist who gave birth to a thriving branch of economics based on human behavior rather than on standard expected utility theory,” said Bruce I. Jacobs, principal at Jacobs Levy Equity Management, in a statement.
Through surveys and experiments with human subjects, Kahneman found that when forced to make complex decisions in uncertain situations, people were not coolly calculating rational agents, Jacobs noted. “Rather, they tended to rely on heuristics — mental shortcuts and rules of thumb. Kahneman found that people could be irrational in systematic ways that could explain what appeared to be anomalies from the perspective of expected utility theory.” Their systematic behavior, Jacobs added, also could be incorporated into a forecasting framework, an insight that gave birth to the field of behavioral economics, Jacobs said.
Jacobs further noted that Kahneman and his frequent research colleague, fellow Israeli-born psychologist Amos Tversky, found that "investors appeared to base decisions on small sample sizes or on gains and losses in isolation rather than on their effects on their wealth as a whole." They also found that investors "tended to give more weight to easily remembered information, leading them, for example, to overstate the perceived crime rate if they happen to know someone who was assaulted."
