Daniel Finkelstein: Insights that came from a row

Lewis begins with the story of Kahneman’s youth, of his time as a Jew in France as the Nazis gradually occupied Europe. The strain of hiding and escape eventually killed Kahneman’s father. But as well as leaving the future economist with a deep stain of pessimism and love of peace, they also left him with a great curiosity.

As a boy, hiding his yellow star of shame and caught after curfew by an SS officer, Kahneman cowered in fear, only to receive a hug and a gift from the officer, who showed a picture of what was obviously his own son. The episode reinforced the teaching of Danny’s mother — that human beings are infinitely complex.

It was teaching that inspired his life’s work, examining the foibles of the human mind. This found a practical outlet in his life as an Israeli army officer. Asked to allocate officers to different branches of the service dependent on their bent of mind, Kahneman discovered the entire exercise was futile.

As indeed were many other behavioural theories in the army. The air force, for instance, had concluded that when it congratulated pilots for a good flight, they did worse next time, while when it told them off for a bad flight, they did better.

Kahneman pointed out that this was just a feature of statistics. People who do exceptionally well one day tend to return to normal the next. The pilots’ behaviour would have changed whether they were congratulated or not.

As for allocating officers to particular services, Kahneman may not have found that psychological testing didn’t help much with that, but it could help determine who would be a good officer overall. The Israeli army still uses a version of what is known as the Kahneman score to determine overall aptitude. And it helps explain why the army can outperform others while using the same equipment.

Yet this work would not have become well known outside the army if Kahneman had not teamed up with another Israeli military man, war hero Amos Tversky.

Tversky, who had thrown himself upon a fellow soldier in a life saving act so brave that Moshe Dayan warned him that he wouldn’t get away with such courage a second time, was not just a military combatant. He was an academic combatant, too, and one used to victory. But when he met Kahneman he found he didn’t automatically win.

Their partnership was the result of conflict. Kahneman was sure that people were bad instinctive statisticians, that they weren’t good calculators of situations and predictions. Tversky, without thinking much about it, assumed this was wrong. They clashed.

And according to Lewis they clashed as two Israelis would clash, not two Americans. They sought to destroy each other’s arguments without much thought for hurt feelings. And then when Kahneman had won this first skirmish, they teamed up and did one other Jewish thing. They laughed at how ridiculous life was and people could be. Out of this derived some of the great psychological insights of the last century. That the economists are wrong. We are not fully rational. It’s a Jewish story that I urge you to read.

Daniel Finkelstein is associate editor of The Times.