Risk Averse and Risk Seeking - Joe Abittan

Risk Averse and Risk Seeking

I would generally categorize myself as somewhat risk averse, but studies from Daniel Kahneman in Thinking Fast and Slow might suggest that I'm not really any different than anyone else. I might just be responding to the set of circumstances that I typically experience, similar to anyone else, and I might just be more aware … Continue reading Risk Averse and Risk Seeking

Desperate Gambles

Desperate Gambles

Daniel Kahneman worked with Amos Tversky to develop many of the concepts that today create the principle of Prospect Theory. Many people are familiar with the psychological and economic principle of Game Theory, and Prospect Theory is a similar psychological and economic theory of how people behave when faced with uncertainty. In his book Thinking … Continue reading Desperate Gambles

Subjective Gains and Losses

Subjective Gains and Losses

"Outcomes that are better than the reference points are gains. Below the reference point they are losses."   Daniel Kahneman writes extensively about our subjective experiences of the world in his book Thinking Fast and Slow and about how those subjective experiences can have very serious consequences in our decisions, political stances, and beliefs about … Continue reading Subjective Gains and Losses

Carelessness

"The most disgraceful kind of loss, however, is that due to carelessness," Seneca wrote in a letter to his friend Lucilius almost 2,000 years ago. Seneca's Letters from a Stoic is a collection of short passages written from Seneca to Lucilius full of interesting reflections on life. His quick quote about carelessness seems to be as fitting … Continue reading Carelessness