Morningstar Magazine - December 2017/January 2018 - 58

Investors

Reality Economics
We're more Homer Simpson than Spock,
says Nobel winner Richard Thaler.

Undiscovered Manager
63

Adding Value and Expressing Values

66

Digital Demand
Sector Snapshot: Financials

MORNINGSTAR CONVERSATION

Morningstar magazine staff

Sector Rap
69

	

	
70

User	Profile

Design With Reach

Richard Thaler received the Nobel Memorial
Prize in Economic Sciences on Oct. 9 for
his pioneering work in behavioral economics. The
month before he won, Thaler sat down with
Barry Ritholtz at the Morningstar ETF Conference
in Chicago for a conversation ranging from
Thaler's mentors to his movie career. Their talk
provided a tour of the field, garnering laughs while
touching on key issues for investors today.
Thaler teaches at the University of Chicago
Booth School of Business, where he is the Charles
R. Walgreen Distinguished Service Professor of
Behavioral Science and Economics. His books
include The Winner's Curse: Paradoxes
and Anomalies of Economic Life; Nudge: Improving
Decisions About Health, Wealth, and Happiness
(co-written by Cass Sunstein); and most

Barry Ritholtz and Richard Thaler at the Morningstar
ETF Conference.

58

Morningstar December/January 2018

recently Misbehaving: The Making of Behavioral
Economics. Thaler also is a principal at Fuller
& Thaler, an asset-management firm with $8 billion
in assets.
Ritholtz is the chief investment officer of Ritholtz
Wealth Management. He also is a columnist with
Bloomberg View and hosts the Masters in
Business podcast. His conversation with Thaler
took place Sept. 7 and has been edited for clarity
and length.
Barry Ritholtz: Let's start with an idea of yours from

one of your more recent books that I found fascinating. It's what you call "econs versus people."
Conventional economics assumes that people are
highly rational and unemotional. They can calculate like
a computer and have no self-control problems.
That leads to two obvious questions. The first is how
does this manifest itself in everyday economic choices?

Richard Thaler: Well, the main point is
that we're not econs. We have a theory based



Table of Contents for the Digital Edition of Morningstar Magazine - December 2017/January 2018

Contents
Morningstar Magazine - December 2017/January 2018 - Cover1
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Morningstar Magazine - December 2017/January 2018 - 1
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