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Amos Tversky and the Ascent of Behavioral Economics

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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.

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Authors and Affiliations

  1. Department of Economics, Harvard University, Cambridge, MA, 02138

    David Laibson

  2. The National Bureau of Economic Research, USA

    David Laibson & Richard Zeckhauser

  3. Kennedy School of Government, Harvard University, Cambridge, MA, 02138

    Richard Zeckhauser

Authors
  1. David Laibson
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  2. Richard Zeckhauser
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Laibson, D., Zeckhauser, R. Amos Tversky and the Ascent of Behavioral Economics. Journal of Risk and Uncertainty 16, 7–47 (1998). https://doi.org/10.1023/A:1007717224343

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  • DOI: https://doi.org/10.1023/A:1007717224343

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