DEFINITION of 'Daniel Kahneman'

A professor emeritus of psychology and public affairs at Princeton University and winner of the 2002 Nobel Prize in Economics, along with Vernon Smith, for his research on prospect theory, which deals with human judgment and decision making. Historically, economics has assumed that people act in their self-interest and make rational decisions. Kahneman's research combines psychology with economics to explore how people's behavior may depart from these assumptions.

BREAKING DOWN 'Daniel Kahneman'

Born in Tel Aviv in 1934, Kahneman spent his early childhood in France, where he and his family had to escape repeatedly from the Nazis until they moved to Palestine. Kahneman has also taught at the Hebrew University of Jerusalem, the University of British Columbia and the University of California at Berkeley.

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