Goldstein's thesis at the University of Chicago used computer simulation to study the accuracy and frugality of satisficing heuristics for making inferences.

Investigations of the take-the-best heuristic and the recognition heuristic were later published as journal articles in Psychological Review and in the book Simple Heuristics That Make Us Smart .

These fast and frugal heuristics have since had an impact in medicine, law and politics, and other areas outside psychology.

In 1995, advisor Gerd Gigerenzer and Goldstein left Chicago to start the Center for Adaptive Behavior and Cognition at the Max Planck Institute in Germany.

From 2002, Goldstein served 3 years as Associate Director of the Center for the Decision Sciences at Columbia University, where he co-authored with Eric J. Johnson an influential article on organ donation in the journal Science.

Goldstein is currently a Principal Research Scientist at Yahoo! Research,on leave from London Business School. Goldstein's recent research investigated perceptions of risk and uncertainty, particularly in financial markets.

He and Nassim Taleb are testing people's statistical intuitions when facing ecological, 'non-textbook' uncertainty, and what they call the ludic fallacy.

Along with Nobel Laureate William F. Sharpe, he has invented a method to measure preferences and beliefs about probabilities called the Distribution Builder.

In 2008, Goldstein was elected to the Executive Board of the Society for Judgment and Decision Making.