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This was in Thinking Fast and Slow by Kahneman.

He described a situation where someone might prefer A to B, and B to C, but then might prefer C to A (when A and C are directly compared to each other).

I can't seem to remember the name of this bias or fallacy, and I looked in the book but wasn't able to find the passage.

Anybody remember what it was?

(The last time I posted a behavioral economics question on here, some people protested that it didn't belong here. For your information, Kahneman has a Nobel in Economics, so please take your objections to the Nobel Committee. Thank you and good day.)

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  • $\begingroup$ Bare in mind that, Daniel Kahneman is a psychologist. The economy prize given to him is because his finding fill up the all the void(especially irrational mistake) of all cheeky economist talk about rationality. IMHO, most "practice economist" has a reason to hate him. $\endgroup$ – mootmoot Jan 9 '17 at 15:31
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When this event occurs it is known as a failure of "transitivity" of preferences.

Transitive preferences are such that for every X,Y,Z, if X is preferred to Y and Y is preferred to Z then X must be preferred to Z.

Economists define rational preferences as binary relations that are complete and transitive, meaning that we can compare everything and the comparisons are consistent.

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