Framework of “two minds”
One of the insights that earned Kahneman the Nobel Prize1 is that we humans are sometimes as susceptible to “cognitive illusions” as we are to optical illusions.
These illusions, also known as biases, result from the use of heuristics, or, more simply, mental shortcuts.
Kahneman’s discovery that under certain circumstances intuition can systematically lead to incorrect decisions and judgments changed psychologists’ understanding of decision making, and, ultimately, economists’, too.
Behavioral Finance, St. Petersburg, 2014