behavioral-economics - Concepts

Explore concepts tagged with "behavioral-economics"

Total concepts: 27

Concepts

Motivating Uncertainty Effect - Psychological phenomenon where uncertainty about receiving a reward increases motivation and engagement more than guaranteed rewards.
Denomination Effect - A cognitive bias where people are less likely to spend larger denominations of currency than their equivalent value in smaller denominations.
Information Gap Theory - A psychological theory proposing that curiosity arises when we perceive a gap between what we know and what we want to know.
Popcorn Pricing - A pricing strategy using a near-premium-priced middle option to make the largest option appear as the best value, nudging customers to spend more.
Present Bias - The tendency to disproportionately prefer immediate rewards over larger future rewards.
Pseudocertainty Effect - A cognitive bias where risk preferences change based on whether outcomes are framed as gains or as avoided losses.
Behavioral Economics - A field combining psychology and economics to study how cognitive biases, heuristics, and emotional factors influence real-world economic decisions.
Expected Utility Theory - The standard economic model of rational decision-making under uncertainty, where agents choose options that maximize expected utility.
Regret Aversion - The tendency to avoid taking actions that might lead to feelings of regret, even when those actions would be objectively beneficial.
Less-is-Better Effect - The tendency to prefer a smaller, complete set over a larger set that includes inferior items when evaluating options separately.
Compromise Effect - The tendency for consumers to prefer middle options when presented with a set of choices ranging from low to high on key attributes.
Temporal Discounting - The behavioral economics concept of reduced valuation of rewards as they are delayed in time.
Nudge Theory - A behavioral science approach that subtly guides people toward better decisions by designing choice environments that make beneficial options easier to choose, without restricting freedom.
Bounded Awareness - The systematic failure to notice, seek out, or use information that is relevant and accessible but falls outside our focus of attention.
Moral Licensing - A psychological phenomenon where doing something good gives people unconscious permission to subsequently do something bad or unethical.
Naive Allocation - Cognitive bias where people divide resources equally among available options regardless of their differing merits or characteristics.
Cognitive Biases - Systematic patterns of deviation from rationality in judgment, arising from mental shortcuts that are efficient but can lead to predictable errors.
Behavioral Momentum - The tendency for established behavior patterns to persist and resist change, analogous to physical momentum in Newtonian mechanics.
Money Illusion - The tendency to think of currency in nominal terms (face value) rather than real terms (purchasing power), ignoring inflation when evaluating financial situations.
System 2 - Slow, deliberate, analytical thinking that requires conscious effort and attention.
Choice Architecture - The design of how choices are presented, which profoundly influences the decisions people make.
Noble Edge Effect - Consumer preference bias where people favor companies that demonstrate genuine social responsibility and ethical practices.
Certainty Effect - The tendency to overweight outcomes that are certain compared to outcomes that are merely probable.
System 1 - Fast, automatic, intuitive thinking that operates effortlessly and unconsciously.
Prospect Theory - A behavioral economics framework showing that people value gains and losses asymmetrically, with losses hurting more than equivalent gains please.
Risk Compensation - The tendency for people to adjust their behavior in response to perceived risk, often taking more risks when they feel protected by safety measures.
Unit Bias - The tendency to want to complete a standardized unit of something regardless of actual quantity, often leading to overconsumption when units are larger.

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