Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Life Insurance

Kahneman’s Close-Up

Your article was successfully shared with the contacts you provided.

Reading the December issue of Vanity Fair, I came across a curious find. Tucked among the Tiffany ads, perfume swatches and half-naked supermodels selling God-knows-what was a decidedly out-of-place picture of Daniel Kahneman.

Kahneman, for those living under rocks, is the Nobel laureate who along with Amos Tversky crystallized the concept of behavioral economics.

The reason for his appearance soon became clear. Regular Vanity Fair contributor and best-selling author Michael Lewis followed up on the success of “Moneyball” and its recent screen adaptation. Book and movie follow the real-life exploits of failed major leaguer Billy Beane as he attempts to find success in an administrative role with the Oakland Athletics. He hires Paul DePodesta, a Harvard undergraduate familiar with Kahneman’s work. The two apply Kahneman’s concepts, cheekily known as “ironic research” when not applied to economics, to help identify undervalued and underutilized talent. Naturally, success follows.

Surprisingly, Lewis wasn’t aware of Kahneman’s work; he only happened upon it post-publication when it was identified in a review of his book in The New Republic by economist Richard Thaler and law professor Cass Sunstein.

Anyway, we now have two successful applications of Kahneman’s research: economics and baseball. Lewis notes one other: bias by doctors in their diagnoses.

Where am I going with this? In this month’s cover story, we catch up with author, speaker and gerontologist Ken Dychtwald. His message of a paradigm shift in how retirement will be viewed by baby boomers—as circular, rather than linear, meaning retirees will continually reinvent themselves as life spans increase rather than go gently into that good night—was all the rage for two decades. Then 2008 hit, and we didn’t hear as much from Ken. But a recently released study from SunAmerica on the subject of retirement both pre- and post-crisis brought him back into our purview. Conducted by his firm Age Wave, the survey answers so many of the questions we’ve been asking since it all went bad.

There’s a direct connection between Kahneman and Dychtwald’s work, one that Lewis inadvertently identifies—economics, leisure and health care. Might they be something in which retirees are interested? Do we really need to ask? Imagine the possibilities when other fields begin to incorporate the findings of ironic research. Imagine.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.