The Undoing Project: A Friendship that Changed the World (181 POCHE)

by Michael Lewis

As they sorted through the implications of their new discovery, one thing was instantly clear: Regret had to go, at least as a theory. It might explain why people made seemingly irrational decisions to accept a sure thing over a gamble with a far greater expected value. It could not explain why people facing losses became risk seeking. Anyone who wanted to argue that regret explains why people prefer a certain $500 to an equal chance to get $0 and $1,000 would never be able to explain why, if you simply subtracted $1,000 from all the numbers and turned the sure thing into a $500 loss, people would prefer the gamble. Amazingly, Danny and Amos did not so much as pause to mourn the loss of a theory they’d spent more than a year working on. The speed with which they simply walked away from their ideas about regret—many of them obviously true and valuable—was incredible. One day they are creating the rules of regret as if those rules might explain much of how people made risky decisions; the next, they have moved on to explore a more promising theory, and don’t give regret a second thought.