Michael Lewis is the writer every writer wants to be. Every book since Liar's Poker has been a best-seller (30 years on, Liar's Poker is still a best-seller), several have been made into movies, and he writes clean, amusing, vivid, highly informative prose about some of the coolest things in the world—sports, finance, the finance of sport, the housing crash and the people who predicted and profited from it, statistics and probabilities. He has a novelist's gift for characterization and pacing, though his characters are all real people and the events he describes all real events. OK, I admit it: Michael Lewis is the writer I want to be.

Now it's psychology and behavioral economics. His latest, The Undoing Project, grows out of his 2004 Moneyball (best-seller; made into a movie!). Moneyball told the story of how the Oakland Athletics used statistics to make their assessment of baseball talent more efficient and accurate, and were able to form a winning team on a fraction of the budget of richer teams (can you say “Yankees”?). In a New Republic review of Moneyball, Richard Thaler and Cass Sustein pointed out that Lewis had missed a deeper question: Why are baseball teams so inaccurate and ineffecient in the first place? Lewis took the criticism: “I'd set out to tell a story about the way markets worked, or failed to work, especially when they were valuing people. But buried somewhere inside it was another story, one that I'd left unexplored and untold, about the way the human mind worked, or failed to work, when it was forming judgments and making decisions” (Undoing Project, 18). Lewis's new book fills the gap left by Moneyball. Which means we can add humility to Lewis's writerly virtues.

The book describes the collaboration, friendship, even love of two Israeli psychologists, Danny Kahneman (best known for Thinking, Fast and Slow) and the late Amos Tversky, who made their reputations describing the cognitive tricks that cause systematic distortions in our thinking and decision-making. They argued that, contrary to the views of some social scientists, human beings are not instinctive statisticians. We are in fact bad at calculating odds, and our decisions are affected by factors that have nothing to do with probabilities or the facts of the case.

“Availability,” for instance. Asked to decide whether there are more English words with the letter “k” as the first letter or as the third letter, most people will say that words beginning with “k” are twice as numerous as words with “k” as a third letter. In fact, the proportions are the opposite: Twice as many words have “k” as the third letter. As Lewis explains, “the more easily people can call some scenario to mind—the more available it is to them—the more probable they find it to be. Any fact or incident that was especially vivid, or recent, or common—or anything that happened to preoccupy a person—was likely to be recalled with special ease, and so be disproportionately weighted in any judgment. Danny and Amos had noticed how oddly, and often unreliably, their own minds recalculated the odds, in the light of some recent or memorable experiences” (189-90).

Memorability distorts perception. Kahneman and Tversky read out lists of names to students. One list consisted predominantly of men but included several famous women; the other list was predominantly women, but included famous men. When asked whether there were more men or women in the list, most participants got it wrong: “If a list had more male names on it, but the women's names were famous, they thought the list contained more female names, and vice versa” (191).

Some of Tversky's early work was more abstractly philosophical. Many social scientists were convinced of that human reasoning and decision-making is “transitive”—that if someone prefers A to B and B to C, then he will prefer A to C. Tversky found that this was not the case. Whether deciding what drink to order or which girl to marry, people who preferred A to B and B to C could be “induced to prefer C to A” (107).

Tversky concluded that the notions of similarity and difference that framed the notion of transivity were flawed: “The reigning theories in psychology of how people made judgments about similarity all had one thing in common: They were based on physical distance. When you compare two things, you are asking how closely they resemble each other.” Distance is a symmetrical concept: It's the same distance from Boston to Baton Rouge whether you start in Massachusetts or Louisiana. But our comparisons of people and things are usually asymmetrical.

Tversky found a study of classification by Eleanor Rosch that undermined the distance framework: People “said that magenta was similar to red, but that red wasn't similar to magenta. Amos spotted the contradiction and set out to generalize it. He asked people if they thought North Korea was like Red China. They said yes. He asked them if Red China was like North Korea—and they said no. People thought Tel Aviv was like New York but that New York was not like Tel Aviv. . . . People often thought that a son resembled his father, but if you asked them if the father resembled his son, they just looked at you strangely” (111-2).

To bypass distance and the symmetry it implied, Amos developed a theory concerning “features of similarity”: “He argued that when people compared two things, and judged their similarity, they were essentially making a list of features. These features are simply what they notice about the objects.” The more noticeable features two things share, the more similar we think them (113).

But the noticeable features aren't constant. They are affected by various factors that have nothing to do with the things being compared. What we notice depends on where we are: Put two Americans together in a strange country and they find they have things in common that would not have been apparent in the US (115). Classification systems also shape the way we perceive similarity: “A banana and an apple seem to be more similar than they otherwise would because we've agreed to call them both fruit. Things are grouped together for a reason, but, once they are grouped, their grouping causes them to seem more like each other than they otherwise would.” Classification, in short “reinforces stereotypes” (115).

I could go on and on, but this post is already too long. And I've somewhat distorted Lewis's book. He's as interested in Tversky and Kahneman themselves as he is in their ideas; this book will be a movie someday too. The Undoing Project is an intellectual feast embedded within a dramatic double biography. It's yet another reason why Lewis is the writer every writer wants to be.