Veronique illon/The Hoya Nobel Laureate Daniel Kahneman speaks in ICC Tuesday, refuting the assumption that people alway act in a rational manner.

Economists have a renewed interest in the well-being of individuals and their decision-making processes due to Nobel Laureate Daniel Kahneman’s prize-winning findings regarding human irrationality.

Kahneman, who received the Nobel Prize in Economics in 2002 for his studies on the psychology and decision-making process of economic actors, delivered a lecture called “Toward a Science of Well-Being” in ICC Auditorium last Thursday to an audience of students and professors.

Kahneman started his lecture with motivating questions.

“Are people happier in California?” he asked.

Kahneman said individuals have two selves, and we do not know which self we should take into consideration while we are measuring their well-being. These are “the wanting self” and “the enjoying self,” he said.

There is a disconnect between these selves because “people do not always enjoy what they want and they do not always want what they would enjoy,” according to Kahneman.

Likewise, he asserted that if we assume that people are rational, we would have to assume that what people want is the same thing as what is good for them. He said that previously, economists did not pay attention to the disconnection between the wanting and enjoying selves because they assumed that people acted rationally.

“The rationality assumption is not taken for granted quite with the same confidence as it was in the past,” Kahneman said.

He further separated human nature into the “experiencing self” and the “remembering self.” The experiencing self would answer the question, “how do you feel now?” according to the momentary utility the person gets from the experience. The remembering self would answer the question “How was the whole experience?” The two selves do not always give the same answer to these questions, he said.

Kahneman gave the example of two patients who were undergoing colonoscopy. The two patients were asked to report their pain every 60 seconds. He said while “patient B” reported more pain at every stage and his operation was longer in duration, “patient A” had a worse memory of the whole experience.

Kahneman gave another example of a sample group in which members were asked to keep their right hands in cold water for 30 seconds and then take them out immediately. Then they repeated the same experiment with their left hands, but kept their hands in water for 30 seconds more while the water got slightly warmer. He said 80 percent of the people they would preferred the longer experience to the shorter experience, because they had a better memory of it.

“They chose [the longer experience] because of their remembering self,” Kahneman said. “It’s the memories that control what we do . the remembering self is in charge.”

On the other side, he explained that the experiencing self experiences life “as a sequence of many moments, but it hardly has time to exist . because these moments are lost without a trace.” The remembering self, however, remembers life “as a tale of significant moments,” remembering only “beginnings, peaks and endings.”

Kahneman said the duration of an experience does not matter when we remember it, but the significant events involved do. He gave the example of a fairytale in which the heroine waits for her lover for a long time, but 10 minutes after he comes back, she dies. Kahneman said the 10-minute duration is not important for the reader – what matters is that her lover made it back.

Kahneman also gave the example of an “interrupted symphony,” where if the orchestra makes a mistake in the end, this mistake does not ruin the experience itself, but the “memory of the experience.”

Researchers usually ask people about their overall satisfaction of life, and the remembering self determines the overall satisfaction, he said.

Kahneman said “objective happiness” can be assessed by aggregating moment utilities. This would give the experiencing self a voice and the experience would not go through the distortion of memory. He said moment utility can be determined by the “sheer amount of electrical activity” in the left prefrontal cortex of the brain, which is responsible for feelings of happiness.

Kahneman further said people expect they will not adapt easily to different situations, because their remembering self remembers difficult, transitional moments. The affective experiencing self, however, adapts quickly to new situations.

He gave the example of voters in Texas who said before the elections that they would not be able to recover if Bush was elected governor. “After the elections they did recover,” he said.

Kahneman, the Eugene Higgins Professor of Psychology and Public Affairs at the Woodrow Wilson School of Public and International Affairs at Princeton University, was third in the Graduate School Distinguished Lecturer Series.