Q

What is loss aversion and how does it affect decision-making?

From 5 years of verified research · Vassili Sandqvist
A

Loss aversion is the psychological phenomenon where losses weigh more heavily on our minds than equivalent gains. This means that losing €100 causes more distress than the pleasure derived from gaining €100. As a result, individuals often make suboptimal decisions, such as holding onto losing investments longer than they should, due to the fear of realizing a loss.

This is one answer. The complete system — the psychology, the biology, and the method — is in the book.

Read The Willpower Lie →
Found an error? Let me know →