I’ve been getting a lot of requests for a book list on behavioral economics, finance, etc. I promised a few of you I would post one.
Here are what I find to be some of the best books on these subjects. I picked books that are aimed at the intelligent reader who does not necessarily have specialized training in economics, sociology, or evolutionary psychology.
But I would also suggest you start with the 30 minute video of Daniel Kahneman’s Nobel price lecture. Videos are always easier than books, and it’ll open your eyes to our cognitive limitations as a species. Yes, that means you, too. Especially you.
Daniel Kahneman’s Nobel lecture
James Montier, The Little Book of Behavioral Investing
Dan Ariely, Predictably Irrational: The Hidden Forces That Shape Our Decisions
George Akerlof and Robert Shiller, Animal Spirits: How Human Psychology Drives the Economy
Richard Thaler, The Winner’s Curse: Paradoxes and Anomalies of Economic Life
Eduardo Porter, The Price of Everything: Solving the Mystery of Why We Pay What We Do
David Brooks, The Social Animal: The Hidden Sources of Love, Character, and Achievement
And, my favorite all time book—though I don’t recommend this if you are interested exclusively in how behavior affects finance, and only should be read if you have a hard-core interest in evolutionary psychology—is:
Robert Wright, The Moral Animal
Since I first put this book list together, Daniel Kahneman came out with an accessible version of his life’s work, Thinking Fast and Slow. I highly recommend it. I have read many of his papers over the years, but this book is by far the most jargon-free of anything I’d seen from him.
Lastly, if any of you are interested in Africa, or economic development, I would recommend you the best, least politicized book I have read on the subject: Paul Collier’s The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It.
Happy reading.