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Loss Aversion Is Deeply Rooted
- Humans overweight losses compared to gains because evolution made avoiding threats more urgent than seeking rewards.
- Loss aversion makes people require roughly double the potential payoff to accept equivalent risk.
Free Changes How We Decide
- The "pain of paying" makes people treat free items differently and alters choices even when math is unchanged.
- Small price cues can inactive loss aversion and radically change behavior.
Choosing The Costlier Ski Trip
- Participants who'd bought two overlapping ski trips usually chose the more expensive one despite a better cheaper option.
- They preferred avoiding the feeling of wasting the first $100 over maximizing future enjoyment.