Barry Ritholtz, Columnist

The High Cost of 'Noise' in Decision Making

Daniel Kahneman, winner of the 2002 Nobel Memorial Prize in Economic Sciences, has a new book examining flaws in human judgement.

May 18, 2021 at 5:30 PM UTC

By Barry Ritholtz

Barry Ritholtz is a former Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”

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How does “noise” affect decision making? According to Daniel Kahneman, winner of the 2002 Nobel Memorial Prize in Economic Sciences and this week’s guest on the Masters in Business podcast, it manifests as an interference in judgement, especially in institutional decision-making. We discuss the problem and his new book Noise: A Flaw in Human Judgment, which he wrote with Oliver Sibony and former Bloomberg Opinion columnist Cass Sunstein.

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