Subtitle of "Noise": The flaws of human judgment Author: [Israel] Daniel Kahneman / [France] Olivier Siboney / [USA] Cass R. Sunstein

Nobel Prize winner in economics, father of behavioral economics

Daniel Kahneman's Thinking, Fast and Slow

A new masterpiece that has been brewing for 10 years

◎ Introduction

Imagine two doctors giving different diagnoses to the same patient; two judges giving different sentences to a suspect who committed the same crime. Imagine the same doctor, judge, or decision maker making different decisions simply depending on when the decision was made. The culprit behind these different decisions is "noise."

Noise is a new blockbuster jointly launched by Daniel Kahneman, Nobel Prize winner in economics and the "father of behavioral economics", together with Olivier Siboney and Cass Sunstein, experts in the field of decision-making. It is also a landmark masterpiece that Kahneman has been thinking about for 10 years after his best-selling book Thinking, Fast and Slow. It is another major discovery in the field of behavioral science. For decades, everyone believed that bias is the key to human judgment errors. But today, Kahneman systematically pointed out that noise is the black hole that affects human judgment.

Through systematic research, the book "Noise" reveals the essence of "misjudgment" through two formulas, and takes you directly to the noise through a systematic analysis of three types of noise. In addition, "noise" is explained from six parts: from finding noise to exploring the nature of human judgment, from predicting noise to explaining the main causes of noise, from exploring practical issues on how to improve judgment and prevent errors, and extending to what is the appropriate noise level. "Noise" is random, but it is deadly. Kahneman proposed 6 principles in the book to help you reshape the decision-making framework and become a smart decision maker. At the same time, Kahneman also cleverly attached a guide to the use of "review noise" and an "observer list" for decision makers.

If Thinking, Fast and Slow fights off the enemy "bias" in the human judgment process, then Noise aims to kill another invisible enemy - noise. Reading this book can help you reshape your decision-making framework, stay away from noise, and become a smart decision maker.

◎ Editor's Recommendation

☆ Daniel Kahneman, Nobel Prize winner in Economics and father of behavioral economics, has been brewing this landmark masterpiece that has attracted global attention for 10 years following Thinking, Fast and Slow, and it is another major discovery in the field of behavioral science.

☆ Wherever there is judgment, there is noise. "Noise" is another subversive book about human judgment. Two formulas reveal the essence of "misjudgment" and take you directly to the noise through a systematic analysis of three types of noise.

☆ Staying away from noise and improving decision-making will affect your thinking and decision-making in the next 10 years.

☆ Once published, "Noise" became popular in 31 countries and regions around the world, attracted the attention of countless business people, and was praised by investors, psychologists, and many media people. They sincerely hope: to let more people understand noise and benefit from noise.

◎ Praise from all sides

From "bias" to "noise", Kahneman, as a psychologist, challenged the "rational man" assumption in economics and won the Nobel Prize in Economics for opening the door to behavioral economics. He has always focused on analyzing how humans make mistakes in decision analysis. In this book, he deeply analyzes the impact of noise, but also optimistically expects that the noise in decision-making can be reduced by discovering information buried in big data. This can be said to be a new trend of big data infiltrating the field of behavioral economics. - Ba Shusong, Executive Dean of the Peking University HSBC Finance Institute and Chief Economist of the China Banking Association

Following Thinking, Fast and Slow, Zhanlu has launched Kahneman's new book Noise (co-authored with Siboney and Sunstein). The book begins by distinguishing between noise and bias. Simply put, noise is irregular errors, and bias is systematic errors. Once you hear this distinction, you will immediately know that it is very important. Noise explores the causes of noise and strategies to reduce it through actual cases in many fields such as judicial decisions and medical diagnosis. It is worth mentioning that the three authors also discussed that efforts to overcome noise can also bring negative consequences. Another good book that is not tiring to read but beneficial all the time. ——Chen Jiaying, Professor of the Department of Philosophy, Capital Normal University

Reading the new work by Kahneman and others made me very interested and excited. It is safe to say that by understanding and practicing the ideas and suggestions of Kahneman and others, we can know how to reduce the system noise that may trouble organizations and individuals, and know that "simplification of decision-making information" is so significant! Moreover, more importantly, we can learn to use scientific knowledge, profound insights and solid principles in the noise to make more humane and fairer decisions, reduce the waste of time, money and talents, save lives, spread kindness, and share meaning. These are the realms pursued by a real and positive life. —— Peng Kaiping, Dean of the School of Social Sciences, Tsinghua University

Errors in human judgment stem from biases and noise. Noise is created when people display different biases. Kahneman, who won a Nobel Prize for his groundbreaking work on psychological biases, is now exploring noise. This book is full of insights into noise and updates our understanding of many existing findings in decision-making research. The methods for reducing noise in Noise can make people smarter and help those self-proclaimed "experts" correct their ignorance. -Zhang Zhixue, Professor, Guanghua School of Management, Peking University

Managers and professionals tend to be very confident when it comes to judgment and decision-making. This new book by Kahneman and his collaborators, "Noise", once again tells us: Humans are far less rational than we think, and human judgment is far less accurate than we think. For decision makers, "know yourself" is an eternal theme; being alert to cognitive flaws is more important than anything else. If I can only recommend one book in 2021, I would recommend "Noise". - Gong Yuzhen, Professor of Management at the National School of Development, Peking University, Vice Dean of BiMBA Business School and Academic Director of EMBA

"Noise" provides a correct cognitive system. For the public and entrepreneurs who are becoming increasingly affluent but still have high expectations for the future, in the post-financial crisis era and the post-epidemic era, in the face of the new environment of rapid changes in the global political and economic situation, and in the reality of increasing noise in the decision-making process, a new cognitive system is particularly important and urgent. ——Zhu Ning, Professor of Finance and Vice Dean of the Shanghai Advanced Institute of Finance, Shanghai Jiao Tong University

An important assumption of modern economic theory is that people are rational and can judge information completely and effectively. But Daniel Kahneman and his collaborators pointed out that this assumption is not consistent with the facts in many cases, so many theoretical results need to be re-examined. This is a major contribution to social science. Human judgment errors consist of two parts: bias and noise. Kahneman's analysis of bias is already well known, and this book's analysis of noise completes the systematic explanation of error. Any individual or institution who hopes to achieve a higher degree of rationality should read Kahneman's new book carefully. - Liu Jin, Vice President of Cheung Kong Graduate School of Business

Life experience is the sum of all choices. We make choices all the time. Work and life develop and change subtly in the choices. No one can always make the right choice. There is always noise affecting judgment. Noise cannot be eliminated, but we should try to reduce its impact. The book "Noise" provides a set of methodologies to reduce noise that is very helpful for life choices. I would like to recommend "Noise" to friends who love life. ——Mao Daqing, Ph.D., founder of Ucommune

Decisions are everywhere, and "noise" and "signals" are intertwined and affect each other. The book "Noise" reveals the subjective judgment defects that have long been ignored by people - although AI has become a new consensus for efficiency solutions today, "people" after AI are still an unavoidable scenario. We need to fully integrate individual complexity into organizational decision-making considerations to explore a more reasonable relationship between business and people. We all look forward to a clear world with less noise. ——Wu Sheng, founder of Scenario Lab

There are laws in nature that have not yet been perceived, which invisibly affect people's decisions. The book "Noise" compares the "human brain" with "measurement tools" and points out the existence of noise. This major discovery will provide a new methodology for the correct decision-making of enterprises and bring deeper thinking to entrepreneurs. For enterprises that have been dancing with noise for a long time, we are surprised by the new concepts proposed by the three authors in this book, and are impressed by the series of scientific theories such as "the formation of noise" and "decision hygiene" during reading. Looking back at the 25 years that Edifier has gone through, we have been adhering to the management philosophy of "reverence, respect, humility and kindness" from top to bottom, and we have invisibly used the methodology mentioned in "Noise", thus greatly reducing the internal friction caused by noise and enabling the sustainable development of enterprises. I believe that this scientific work written by a Nobel Prize winner in economics that directly points to "human judgment defects" is universal, and it will surely inspire your wisdom and inject new creativity into the "interaction between people and the world." ——Zhang Wendong, Chairman and President of Edifier

Intellectual elites often build up a sense of superiority in intellectual selection and gain a sense of achievement in the world of fame and fortune, but do they approach rationality because of this? The "gentleman should be moderate" proposed by our predecessors may be a kind of respect for the deviation and noise in information decision-making. - Gui Jiang, Partner of Xinpu Investment

Many large companies and institutions emphasize that the judgments and decisions of each employee and each grassroots unit should be highly consistent with the principles and criteria set by the core management, thinking that this will lead to good judgments and decisions, but it is often the opposite. The judgments and decisions made by those who perform specific operations are of poor quality, with many errors and a chaotic process. This is like a symphony orchestra with poor performance. Facing the conductor, the sounds played by each musician are chaotic, inconsistent and discordant. How should this very inconsistent and chaotic error be defined, measured and systematically reduced? Kahneman's new book "Noise" clearly and systematically discusses these issues. With in-depth understanding and learning and application, the grassroots and the top can be more consistent. Doing so will greatly improve the fairness and efficiency of the enterprise and even the entire society. For corporate and government management, this book must be read and used. ——Liu Jianwei, host of CCTV's ten-episode "Learning Buffett" program and author of "Buffett's 10 Stock Selection Tips" and other books

People are worried about "algorithms ruling the world", but they are actually worried about the "noise pollution" hidden behind the complex algorithms, but this idea is actually confusing cause and effect. These noises are precisely due to people's cognitive limitations and judgment flaws. How to create a world with less noise is the focus of Kahneman's book. "Noise" is a book worth reading from beginning to end. For organizations and individuals who want to improve their cognitive level and decision-making quality, the term "decision hygiene" will definitely hit your heart. - Duan Yongchao, Chief Strategy Officer of Caixun Media Group and Founding Partner of Weicao Zhiku

Faced with multiple uncertainties such as the environment and information, how can we carefully analyze and judge and make appropriate decisions? Professor Kahneman's new book "Noise" provides a new methodology, allowing us to learn to discover and eliminate system noise while being vigilant against subjective biases. ——He Gang, editor-in-chief of Caijing magazine, editor-in-chief of the Chinese version of Harvard Business Review, and co-founder of the Chinese version of Barron's

Life is made up of judgments, big and small. Judgment is life. Judgment is not only affected by bias, but also by noise. If bias causes "incompleteness of decision-making", noise causes "inconsistency of decision-making". Noise is related to people's personality, preferences and changes in the external environment. It often appears randomly, but the impact is huge. The revelation of "Noise" is that we will be accompanied by noise, but there are also ways to reshape the decision-making framework and make better decisions. ——Qin Shuo, initiator of the China Business Civilization Research Center and Qin Shuo's circle of friends

"Noise" is a very special book. The author uses various vivid cases and experiments from a psychological perspective to present to us the concept of "noise", which is different from "bias". The three authors analyze the possible impact of noise when we make judgments in various fields, and how to reduce its adverse effects. Anyone who hopes to make the right decisions should read this book. - Zhang Yan, publisher of FT Chinese Network

The impact of Noise is seismic because it explores a fundamental and underappreciated danger in human judgment. Noise is a must-read that offers actionable methods for reducing the number of errors in decision making. —Robert Cialdini, bestselling author of Influence

In Noise, the three authors skillfully apply their unique and novel insights into the flaws of human judgment to problems of human judgment in all fields. The people who make judgments and decisions range from penalty coaches to central bank governors, military commanders, and even heads of state. Noise is a remarkable achievement in the field of psychology and a milestone. —Philip E. Tetlock, bestselling author of Superforecasting

Masterpiece! Kahneman, Siboney, and Sunstein bring Noise to life, convincingly explaining why we should treat random variation in human judgment as we do bias, and offering practical solutions for reducing noise (and bias) in judgment. —Annie Duke, bestselling author of Bets

Daniel Kahneman

Nobel Prize winner in Economics, recipient of the Presidential Medal of Freedom, author of the global bestseller Thinking, Fast and Slow, Eugene Higgins Professor of Psychology, Princeton University, and professor at the School of Public and International Affairs. He has won many medals, including the Lifetime Achievement Award in Psychology from the American Psychological Association. Kahneman's achievements in psychology are to challenge the rational model of judgment and decision-making, and he is recognized as "the greatest contemporary psychologist after Freud." His cross-disciplinary research has had a profound impact on economics, medicine, political science, sociology, social psychology, cognitive science and other fields, and he is known as the "father of behavioral economics."

Olivier Sibony

Professor at HEC Paris and foreign professor at Saïd Business School, University of Oxford. He served as a senior partner at McKinsey & Company, the world's largest strategic consulting firm, for 25 years. Siboni's research areas are strategy, decision-making, and problem solving. He strives to improve the quality of decision-making. His papers have been published in many excellent journals, including Harvard Business Review and MIT Sloan Management Review. In June 2011, the article Before You Make That Big Decision co-authored with Kahneman was on the cover of the Harvard Business Review anthology. He is the author of You Are About to Make a Terrible Mistake, which is dedicated to revealing how bias affects our decision-making and how we should deal with it.

Cass R. Sunstein

Professor at Harvard Law School, founder and director of the Behavioral Economics and Public Policy Research Project, with a main research area in policy making. From 2009 to 2012, he served as Director of the White House Office of Information and Regulatory Affairs; from 2013 to 2014, he joined the White House Review Group on Intelligence and Communications Technologies; from 2016 to 2017, he joined the Defense Innovation Board of the U.S. Department of Defense. He has written several New York Times bestsellers, including Nudge, co-authored with Richard Thaler, The World According to Star Wars, a legal work based on the movie Star Wars, and How Change Happens, among many others.