The Winner’s Curse

Brought to you by Penguin.

Nobel Prize-winner and co-author of Nudge, Richard Thaler, and rising star economist Alex Imas explore behavioral economics in this fully updated edition of the seminal work The Winner’s Curse

Why do people cooperate with one another when they have no incentive to do so? Why do we hold onto possessions of little value? And why is the winner of an auction so often disappointed?

Over thirty years ago, Richard Thaler introduced readers to behavioral economics in his seminal Anomalies column, written with collaborators including Daniel Kahneman and Amos Tversky. These provocative articles challenged the fundamental idea at the heart of economics that people are selfish, rational optimizers, and provided the foundation for what became behavioral economics. That was then. Now, three decades later, Thaler has teamed up with economist Alex Imas to write a new book. Every chapter starts with an original Anomaly, retaining the spirit of its timestamp. Then, shifting to the present, they provide current updates to each, asking how the original findings have held up and how the field has evolved since then.

It turns out these findings still show up almost everywhere. Anomalies pop up in people’s decisions to save for retirement and how they carry outstanding credit card debt. Even experts fail to optimize. The key concept of loss aversion explains missed putts by golf pros and the selection of which stocks to sell by portfolio managers. In this era of meme stocks and Dogecoin, it is hard to defend the view that financial markets are highly efficient. The good news, however, is that the anomalies have got much funnier.

With both readability and rigor, The Winner’s Curse illuminates these ideas for anyone – from those with a cursory understanding of economics to fellow economists. Each chapter provides a key insight into human behavior so readers learn how to better understand the choices made by their friends, colleagues, and customers, and might just become better at making decisions themselves.

© Richard H. Thaler and Alex O. Imas 2025 (P) Penguin Audio 2025