Behavioral Economics | 100MentalModels

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A split-panel sketch illustrating The Framing Effect. On the left, a person smiles happily while looking at a yogurt labeled "99% Fat-Free". On the right, the same person looks concerned and hesitant while looking at an identical yogurt labeled "Contains 1% Fat.

A split-panel sketch illustrating The Framing Effect. On the left, a person smiles happily while looking at a yogurt labeled "99% Fat-Free". On the right, the same person looks concerned and hesitant while looking at an identical yogurt labeled "Contains 1% Fat.

The Framing Effect. How a Single Word Changes Your Mind

A cognitive bias where people decide on options based on whether the options are presented with positive or negative connotations: the...

Aug 162 min read

A split-panel sketch showing that the pain of losing is greater than the pleasure of gaining. On the left, a person has a small smile while finding $100. On the right, the same person has an intensely pained and exaggerated expression while dropping $100.

A split-panel sketch showing that the pain of losing is greater than the pleasure of gaining. On the left, a person has a small smile while finding $100. On the right, the same person has an intensely pained and exaggerated expression while dropping $100.

Overcoming Loss Aversion for Smarter Investing

At its core, Loss Aversion is the observation that for human beings, the emotional impact of a loss is significantly more intense than...

Aug 166 min read

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