Review of “Noise: A Flaw in Human Judgement,” by Daniel Kahneman et al.

This was a good follow-up to Kahneman’s previous book, “Thinking Fast and Slow.” It explores how decisions are made in organizational settings such as criminal sentencing, determining insurance rates, and several other areas. Real studies are used as examples and several important concepts are introduced in a textbook manner, with plenty of repetition of key ideas.

The components of noisy decision making are described and the cost/benefit of reducing each source is discussed in an organized way, making it easy to understand. The origins of noise are described and related to psychological and sociological factors; however, there is some conjecture here because the field has not been studied in depth. Thus, just as with “Thinking Fast and Slow,” this book compiles work from several fields into a concise summary with a simple unifying concept.

“Noise” falls short somewhat, however, because it doesn’t reach beyond the data, which are limited to a few large disciplines where the effect of unwanted noise is deleterious. That isn’t the authors’ fault because they can’t go where no on has ventured before, but I for one would love to see the ideas presented here extrapolated to individual decision making. That would be very interesting.

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