A comprehensive guide for bringing the power of money under control.
By her count, BBC Radio host Hammond (Time Warped: Unlocking the Mysteries of Time Perception, 2013, etc.) discusses 263 experiments by psychologists and neuroscientists that demonstrate how science can illuminate our many foibles and obsessions about money and deal with them effectively. The author—who has won awards from the British Psychological Society, the British Neuroscience Association, and other medical, psychological, and publishing associations for her contributions to the public understanding of science—reviews their insights, which range from the best ways to encourage children to improve their grades at school and teach them how to manage their pocket money to lessons about older, unconscious processes gleaned from Yale University’s work with token-managing monkeys. The primates, hoping for grapes, are taking part in experiments on loss aversion similar to those conducted on humans by neuroscientist Daniel Kahneman. “Just like humans, [the capuchins] seem to hate a loss” rather than seek the pleasure of a potential gain. Whether shopping or eating out, the motivation seems to be the same. Case studies illustrate how to make decisions about which kind of all-you-can-eat buffet to visit. Spending more for the buffet, for example, and really enjoying the food, works out better than eating from the cheaper spread. Pleasure, enjoyment, and good memories seem to be preferable as time passes, so for people who want to spend money on themselves, Hammond recommends buying “experiences rather than material goods.” In a practical, sometimes-amusing narrative, Hammond provides a valuable summary of work in psychology, behavioral economics, and more, and her numbered “Money Tips” are particularly helpful.
A delightful treatment of a subject many of us would prefer to ignore, gently subversive in its undermining of preconceptions and prejudices.Pub Date: Nov. 1, 2016
ISBN: 978-0-06-231700-1
Page Count: 384
Publisher: Perennial/HarperCollins
Review Posted Online: Sept. 18, 2016
Kirkus Reviews Issue: Oct. 1, 2016
Categories: PSYCHOLOGY | BUSINESS | PERSONAL FINANCE | ECONOMICS
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BOOK REVIEW
“Quality of life means more than just consumption”: Two MIT economists urge that a smarter, more politically aware economics be brought to bear on social issues.
It’s no secret, write Banerjee and Duflo (co-authors: Poor Economics: A Radical Rethinking of the Way To Fight Global Poverty, 2011), that “we seem to have fallen on hard times.” Immigration, trade, inequality, and taxation problems present themselves daily, and they seem to be intractable. Economics can be put to use in figuring out these big-issue questions. Data can be adduced, for example, to answer the question of whether immigration tends to suppress wages. The answer: “There is no evidence low-skilled migration to rich countries drives wage and employment down for the natives.” In fact, it opens up opportunities for those natives by freeing them to look for better work. The problem becomes thornier when it comes to the matter of free trade; as the authors observe, “left-behind people live in left-behind places,” which explains why regional poverty descended on Appalachia when so many manufacturing jobs left for China in the age of globalism, leaving behind not just left-behind people but also people ripe for exploitation by nationalist politicians. The authors add, interestingly, that the same thing occurred in parts of Germany, Spain, and Norway that fell victim to the “China shock.” In what they call a “slightly technical aside,” they build a case for addressing trade issues not with trade wars but with consumption taxes: “It makes no sense to ask agricultural workers to lose their jobs just so steelworkers can keep theirs, which is what tariffs accomplish.” Policymakers might want to consider such counsel, especially when it is coupled with the observation that free trade benefits workers in poor countries but punishes workers in rich ones.
Occasionally wonky but overall a good case for how the dismal science can make the world less—well, dismal.Pub Date: Nov. 12, 2019
ISBN: 978-1-61039-950-0
Page Count: 432
Publisher: PublicAffairs
Review Posted Online: Aug. 28, 2019
Kirkus Reviews Issue: Sept. 15, 2019
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SEEN & HEARD
A psychologist and Nobel Prize winner summarizes and synthesizes the recent decades of research on intuition and systematic thinking.
The author of several scholarly texts, Kahneman (Emeritus Psychology and Public Affairs/Princeton Univ.) now offers general readers not just the findings of psychological research but also a better understanding of how research questions arise and how scholars systematically frame and answer them. He begins with the distinction between System 1 and System 2 mental operations, the former referring to quick, automatic thought, the latter to more effortful, overt thinking. We rely heavily, writes, on System 1, resorting to the higher-energy System 2 only when we need or want to. Kahneman continually refers to System 2 as “lazy”: We don’t want to think rigorously about something. The author then explores the nuances of our two-system minds, showing how they perform in various situations. Psychological experiments have repeatedly revealed that our intuitions are generally wrong, that our assessments are based on biases and that our System 1 hates doubt and despises ambiguity. Kahneman largely avoids jargon; when he does use some (“heuristics,” for example), he argues that such terms really ought to join our everyday vocabulary. He reviews many fundamental concepts in psychology and statistics (regression to the mean, the narrative fallacy, the optimistic bias), showing how they relate to his overall concerns about how we think and why we make the decisions that we do. Some of the later chapters (dealing with risk-taking and statistics and probabilities) are denser than others (some readers may resent such demands on System 2!), but the passages that deal with the economic and political implications of the research are gripping.
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our minds.Pub Date: Nov. 1, 2011
ISBN: 978-0-374-27563-1
Page Count: 512
Publisher: Farrar, Straus and Giroux
Review Posted Online: Sept. 3, 2011
Kirkus Reviews Issue: Sept. 15, 2011
Categories: BUSINESS | LEADERSHIP, MANAGEMENT & COMMUNICATION | PSYCHOLOGY
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BOOK REVIEW
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