Tversky-Kahneman Framework

The Tversky-Kahneman framework explores how humans make decisions under uncertainty, highlighting cognitive biases that influence choices. It shows that people don't always act rationally; instead, they are affected by heuristics—mental shortcuts—and biases like loss aversion (feeling worse about losses than equivalent gains) and framing effects (decisions change based on how options are presented). This framework helps explain common decision-making errors and guides better strategies in economics, policy, and behavioral science by understanding the psychological factors behind choices.