Regret Aversion
This is the tendency to avoid taking an action due to the fear that—in hindsight—it will turn out to have been less than optimal. Like leaving money in a bank account, rather than putting the cash in an investment with…
Tag: Prosper Slowly
Bigness Bias
Have you also observed that many people behave as if not all dollars are created equal? By assigning relative values to different moneys that in reality have the same buying power, they run the risk of being too quick to spend,…
STATUS QUO BIAS
Irrationally wanting things to stay the same, also called inertia. We do this in part because we want to avoid costs, even when they’re offset by a larger gain, a process psychologists call “Loss aversion”. You hold onto a mutual fund…
Bigness Bias
Have you also observed that many people behave as if not all dollars are created equal? By assigning relative values to different moneys that in reality have the same buying power, they run the risk of being too quick to spend,…
STATUS QUO BIAS
Irrationally wanting things to stay the same, also called inertia. We do this in part because we want to avoid costs, even when they’re offset by a larger gain, a process psychologists call “Loss aversion”. You hold onto a mutual fund…