Choices, Values, and Frames is not really a self-contained book but rather a compilation of articles produced by several different authors that were originally published mostly in academic journals. The central theme for the collection is an exploration of the development and implications of Kahneman and Tversky’s prospect theory, which is viewed by many to be the foundation of the behavioral approach to finance in that it offered a plausible alternative to the conventional “rational man” model of economic activity. It was also the contribution that factored heavily into the decision to award Kahneman the Nobel Prize.

You do not need to be either an economist or a psychologist by training to enjoy and get the gist of the research gathered here, which considers many other topics as well, such as frame dependence, prediction bias, mental accounting, preference reversals, and judgments biased by overconfidence. Incidentally, this volume was preceded by the equally compelling collection Judgment Under Uncertainty, which was also edited by Kahneman and Tversky along with Paul Slovic. Both works definitely belong on the bookshelf of any serious student in this area. ( )