Sublime

One such consequence: prospect theory shows that it is not only the net utility that matters to an individual, but how that net utility comes about.

most shoppers have little choice but to depend on the expended effort heuristic, or some of the other mental shortcuts

If you have ever heard a financial expert refer to the stock market using terms like alpha, beta, or standard deviation, you have witnessed reductive bias in action.

A product that has been reduced from $100 to $70 seems a better value than a product that has always cost $70. The starting price should play no role.

customers are likely to compare them directly instead of changing their subconscious evaluation of the true value of the product.

If the first speaker says that Adam is clearly best, the second might agree, not because she prefers Adam, but because she trusts the first speaker and it is not clear that he is wrong.

The perception of the other player as biased and irrational was driven entirely by the group who were told that they did better than their peers. Something about feeling superior in profits made people feel superior to other players about their opinions, too.

The experiment showed that group decisions, even obviously poor ones, influence our individual decisions.

only about 10 percent of their sample follow something approximating this rule.