Journal of Risk and Uncertainty

, Volume 16, Issue 1, pp 7–47

Amos Tversky and the Ascent of Behavioral Economics

Authors

  • David Laibson
    • Department of EconomicsHarvard University
    • The National Bureau of Economic Research
  • Richard Zeckhauser
    • Kennedy School of GovernmentHarvard University
    • The National Bureau of Economic Research
Article

DOI: 10.1023/A:1007717224343

Cite this article as:
Laibson, D. & Zeckhauser, R. Journal of Risk and Uncertainty (1998) 16: 7. doi:10.1023/A:1007717224343

Abstract

Amos Tversky investigated and explained a wide range of phenomena that lead to anomalous human decisions. His two most significant contributions, both written with Daniel Kahneman, are the decision-making heuristics—representativeness, availability, and anchoring—and prospect theory. Tversky's concepts have broadly influenced the social sciences. In economics, they gave rise to the burgeoning field of behavioral economics. This field, skeptical of perfect rationality, emphasizes validation of modeling assumptions, integration of micro-level data on decisions (including experimental evidence), and adoption of lessons from psychology. Tversky's contributions are reviewed, assessed using citation analysis, and placed in historical context. Fertile areas for behavioral economics research are identified.

Behavioral economicsdecision theoryheuristics and biasesprospect theorypsychology and economicsrationality
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© Kluwer Academic Publishers 1998