The lecture, delivered by Daniel Kahneman, reflects on the joint work with Amos Tversky, focusing on the psychology of intuitive beliefs and choices, and their bounded rationality. The essay covers three major topics: heuristics of judgment, risky choice, and framing effects. Kahneman discusses the distinction between intuitive and deliberate thought processes, emphasizing the role of accessibility in shaping judgments. Heuristics are described as processes where individuals assess a target attribute by substituting a related but more accessible heuristic attribute. The lecture also explores framing effects, where different presentations of the same problem lead to different preferences, and prospect theory, which posits that changes and differences are more accessible than absolute values. Kahneman highlights the limitations of rational-choice models and the importance of considering the context and reference points in decision-making. The lecture concludes with a discussion of attribute substitution, a model that explains how judgment heuristics work and how they can be modified by System 2 monitoring.The lecture, delivered by Daniel Kahneman, reflects on the joint work with Amos Tversky, focusing on the psychology of intuitive beliefs and choices, and their bounded rationality. The essay covers three major topics: heuristics of judgment, risky choice, and framing effects. Kahneman discusses the distinction between intuitive and deliberate thought processes, emphasizing the role of accessibility in shaping judgments. Heuristics are described as processes where individuals assess a target attribute by substituting a related but more accessible heuristic attribute. The lecture also explores framing effects, where different presentations of the same problem lead to different preferences, and prospect theory, which posits that changes and differences are more accessible than absolute values. Kahneman highlights the limitations of rational-choice models and the importance of considering the context and reference points in decision-making. The lecture concludes with a discussion of attribute substitution, a model that explains how judgment heuristics work and how they can be modified by System 2 monitoring.