Policy makers, like most people, normally feel that they already know all the psychology and all the sociology they are likely to need for their decisions. I don't think they are right, but that's the way it is.
Interpretation
The quote highlights the overconfidence of policy makers in their understanding of psychology and sociology.
In this quote, Daniel Kahneman suggests that policy makers, similar to many individuals, often believe they possess sufficient knowledge of psychological and sociological concepts to inform their decisions. He challenges this assumption, implying that such self-assurance may lead to flawed or uninformed decision-making, emphasizing the complexity of human behavior and social dynamics that often require deeper understanding.
In practice
During a panel discussion on governance, a speaker could use this quote to illustrate the risks of overconfidence in decision-making.
We think, each of us, that we're much more rational than we are. And we think that we make our decisions because we have good reasons to make them. Even when it's the other way around. We believe in the reasons, because we've already made the decision.
The average investor's return is significantly lower than market indices due primarily to market timing.
Banks are run by executives, and executives protect themselves, and that does not always mean that banks are going to behave rationally.
Laziness is built deep into our nature.
Through some combination of culture and biology, our minds are intuitively receptive to religion.
You are more likely to learn something by finding surprises in your own behavior than by hearing surprising facts about people in general.
The more freedom is extended to business, the more prisons have to be built for those who suffer from that business.
It is not always the same thing to be a good man and a good citizen.
If Liberia has failed, then, it is no evidence of the failure of the Negro in government. It is merely evidence of the failure of slavery.
Sometimes it seemed like the truth was a bandy-legged soul who dashed from one side of the world to the other and I could never find him.
Faith is not believing that God can, but that God will.
Race doesn't really exist for you because it has never been a barrier. Black folks don't have that choice.
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