the.com/loss aversion
losing $20 hurts twice as much as finding $20 feels good, and your brain never forgot it.
means a cognitive bias where people weigh potential losses roughly twice as heavily as equivalent gains when making decisions.
from named and proven by kahneman and tversky in their 1979 prospect theory paper, which broke economics' assumption that humans rationally weigh gains and losses the same way.
the ratiolosses feel about 2x as intense as equal gains
nobel proofkahneman won 2002 economics nobel partly for this
endowment effectyou overvalue things simply because you own them
evolutionary rootancestors who feared loss survived scarcity better
for instance
stock market panic selling — investors dump falling stocks faster than they buy rising ones
free trial cancellations — gyms bank on you not cancelling to avoid feeling a loss
mug experiment 1990 — kahneman had owners demand 2x more to sell mugs than buyers offered
sunk cost projects — companies keep funding failing projects to avoid admitting loss