[Economics]
Book Review of ’Noise: A Flaw In Human Judgment’ by Daniel Kahneman, Olivier Sibony, and Cass R. Sunstein.
Egor Bronnikov
Journal of Behavioral Economics for Policy, 2022, vol. 6, no. 1, pp. 53-54
Humans making decisions, at large, are not strictly rational, but sensitive to many external circumstances, or contexts. Examples of these include weather conditions, successes or failures of their favoured sports teams or even the time that has passed since lunch. Anyone who has been exposed to popular results from Behavioural Economics will not be really surprised by these instances. However, such context sensitivity also applies to university admission officers who have to judge candidates’ academic merits on cloudy or sunny days; to medical doctors who tend to be much more willing to prescribe opioids to patients in their last working hours; or even to federal judges who are significantly more condescending to the accused person in nasty weather conditions outside. Are these cases problematic indeed? Many might guess that on average these errors may cancel out. However, the authors of Noise argue this conjecture is neither correct nor harmless from the social viewpoint.