Edge 259: Thaler, Mullainathan, Kahneman: A Short Course In Behavioral Economics

Edge 259 - October 3, 2008

(17,100 words)

http://www.edge.org

This online EDGE edition with graphics and video is available at:
http://www.edge.org/documents/archive/edge259.html

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THE THIRD CULTURE
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A SHORT COURSE IN BEHAVIORAL ECONOMICS
EDGE Master Class 2008
Sonoma, CA, July 25-27, 2008

RICHARD THALER, SENDHIL MULLAINATHAN, DANIEL KAHNEMAN

The Master Class with text and video is comprised of six classes which is being published one per week for the next six weeks. Class One is published in today's EDGE edition. The PERMALINK URL is: http://www.edge.org/3rd_culture/thaler_sendhil08/thaler_sendhil_index.html

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A year ago, EDGE convened its first "Master Class" in Napa, California, in which psychologist and Nobel Laureate Daniel Kahneman taught a 9-hour course: "A Short Course On Thinking About Thinking". Among the attendees were a "who's who" of the new global business culture.

This year, to continue the conversation, we invited Richard Thaler, the father of behavioral economics, to organize and lead the class: "A Short Course On Behavioral Economics". Thaler, in turn, invited Harvard economist and former student Sendhil Mullainathan, as well as Daniel Kahneman, to teach the class with him.

Beginning October 1st, EDGE will begin to publish on a weekly basis the text, selected video highlights, and photos of the six classes comprising "A Short Course In Behavioral Economics". This EDGE edition includes the Table of Contents, Introduction By Daniel Kahneman, Summary of Day 1 By Nathan Myhrvold, Summary of Day 2 By George Dyson; Link to the Photo Gallery; and Link to Class One.

-John Brockman, Editor

RICHARD H. THALER is the father of behavioral economics-the study of how thinking and emotions affect individual economic decisions and the behavior of markets. He investigates the implications of relaxing the standard economic assumption that everyone in the economy is rational and selfish, instead entertaining the possibility that some of the agents in the economy are sometimes human. Thaler is Director of the Center for Decision Research at the University of Chicago Graduate School of Business. He is coauthor (with Cass Sunstein) of Nudge: Improving Decisions About Health, Wealth, and Happiness.

SENDHIL MULLAINATHAN, a Professor of Economics at Harvard, a recipient of a MacArthur Foundation "genius grant", conducts research on development economics, behavioral economics, and corporate finance. His work concerns creating a psychology of people to improve poverty alleviation programs in developing countries. He is Executive Director of Ideas 42, Institute of Quantitative Social Science, Harvard University.

DANIEL KAHNEMAN is Eugene Higgins Professor of Psychology, Princeton University, and Professor of Public Affairs, Woodrow Wilson School of Public and International Affairs. He is winner of the 2002 Nobel Prize in Economic Sciences for his pioneering work integrating insights from psychological research into economic science, especially concerning human judgment and decision-making under uncertainty.

PARTICIPANTS: Jeff Bezos, Founder, Amazon.com; John Brockman, Edge Foundation, Inc.; Max Brockman, Brockman, Inc.; George Dyson, Science Historian; Author, Darwin Among the Machines; W. Daniel Hillis, Computer Scientist; Cofounder, Applied Minds; Author, The Pattern on the Stone; Daniel Kahneman, Psychologist; Nobel Laureate, Princeton University; Salar Kamangar, Google; France LeClerc, Marketing Professor; Katinka Matson, Edge Foundation, Inc.; Sendhil Mullainathan, Professor of Economics, Harvard University; Executive Director, Ideas 42, Institute of Quantitative Social Science; Elon Musk, Physicist; Founder, Tesla Motors, SpaceX; Nathan Myhrvold, Physicist; Founder, Intellectual Venture, LLC; Event Photographer; Sean Parker, The Founders Fund; Cofounder: Napster, Plaxo, Facebook; Paul Romer, Economist, Stanford; Richard Thaler, Behavioral Economist, Director of the Center for Decision Research, University of Chicago Graduate School of Business; coauthor of Nudge; Anne Treisman, Psychologist, Princeton University; Evan Williams, Founder, Blogger, Twitter.

http://www.edge.org/documents/archive/edge259.html#shortcourse
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NOTABLE QUOTE
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"Globalization creates interlocking fragility, while reducing volatility and giving the appearance of stability. In other words it creates devastating Black Swans. We have never lived before under the threat of a global collapse. Financial Institutions have been merging into a smaller number of very large banks. Almost all banks are interrelated. So the financial ecology is swelling into gigantic, incestuous, bureaucratic banks - when one fails, they all fall. The increased concentration among banks seems to have the effect of making financial crisis less likely, but when they happen they are more global in scale and hit us very hard. We have moved from a diversified ecology of small banks, with varied lending policies, to a more homogeneous framework of firms that all resemble one another. True, we now have fewer failures, but when they occur Š.I shiver at the thought."

- Nassim Taleb, The Black Swan (2006)

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This online EDGE edition with graphics and video is available at:
http://www.edge.org/documents/archive/edge259.html

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Edge Foundation, Inc. is a nonprofit private operating foundation under Section 501(c)(3) of the Internal Revenue Code.
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EDGE

John Brockman, Editor and Publisher
Russell Weinberger, Associate Publisher
Karla Taylor, Editorial Assistant

Copyright (c) 2008 by EDGE Foundation, Inc.
All Rights Reserved.

Published by EDGE Foundation, Inc.,
5 East 59th Street, New York, NY 10022

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