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The Framing Effect as outlined by Prospect Theory indicates people make different decisions based on whether a choice is presented as a gain or loss. Don’t do this. You need to examine decisions from both perspectives to ensure you have properly thought through your options. A famous example from the […]
It’s natural to think bad things won’t happen to you. This is problematic because it leads people to mentally underweight their exposure to potential external negative events versus their actual probability. Given the natural inclination to think of yourself as special and not subject to the whims of fate. […]
People are prone to actively avoiding information contradicting their existing beliefs. People are also very good at lying to themselves. So when we are exposed to information contradicting existing beliefs we develop complex internal monologues explaining away the validity of the new information. Not surprisingly this impedes good decision making. […]