Behavioral economics

Why do we feel the sting of loss more than the joy of gain?

Imagine you've just bought a concert ticket for $100, but then a friend offers you a better seat for free. You're torn between keeping your ticket and accepting the better offer.

You might feel the loss of your $100 ticket more acutely than the pleasure of getting a free seat because it's easier to let go of what's already yours.

Example

You feel the loss of $100 more than the happiness of getting something for free.

Remember this

This is known as loss aversion.

Text adapted from Wikipedia, licensed under CC BY-SA 4.0.

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Educational content, not financial advice.

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