FILE SELECTED // FILE 00
Loss Aversion
“A gain of fifty and a loss of fifty cancel on paper. Do they cancel in experience?”
01 / SUMMARY
In short
In many decisions, a loss relative to a reference point weighs more than a comparable gain. Its strength is not a universal constant; it depends on the stakes, experience, and how that reference point is set.
03 / SCENE
In the wild
Someone may reject a gamble with a 50% chance to gain 110 and a 50% chance to lose 100 even though its expected value is positive.
04 / LIMIT
The limit
It is not the same as fearing every risk; people may seek risk precisely to avoid accepting a sure loss.
FINAL NOTE
What remains
Separate the final outcome from the feeling of giving up something you had already counted as yours.