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For example, the representativeness heuristic is defined as "The tendency to judge the frequency or likelihood" of an occurrence by the extent of which the event "resembles the typical case." The "Linda Problem" illustrates the representativeness heuristic (Tversky & Kahneman, 1983). Participants were given a description of "Linda" that ...
Nudge theory is a concept in behavioral economics, decision making, behavioral policy, social psychology, consumer behavior, and related behavioral sciences that proposes adaptive designs of the decision environment (choice architecture) as ways to influence the behavior and decision-making of groups or individuals
Examples. One of the most famous examples of the endowment effect in the literature is from a study by Daniel Kahneman, Jack Knetsch & Richard Thaler, in which Cornell University undergraduates were given a mug and then offered the chance to sell it or trade it for an equally valued alternative (pens). They found that the amount participants ...
v. t. e. A cognitive map is a type of mental representation which serves an individual to acquire, code, store, recall, and decode information about the relative locations and attributes of phenomena in their everyday or metaphorical spatial environment. The concept was introduced by Edward Tolman in 1948. [1]
Internality. An internality is the long-term benefit or cost to an individual that they do not consider when making the decision to consume a good or service. One way this is related to behavioral economics is by means of the concept of hyperbolic discounting, in which immediate consequences of a decision are disproportionately weighed compared ...
Scarcity, in the area of social psychology, works much like scarcity in the area of economics. Scarcity is basically how people handle satisfying themselves regarding unlimited wants and needs with resources that are limited. [1] Humans place a higher value on an object that is scarce, and a lower value on those that are in abundance.
Collective action refers to action taken together by a group of people whose goal is to enhance their condition and achieve a common objective. [1] It is a term that has formulations and theories in many areas of the social sciences including psychology, sociology, anthropology, political science and economics .
Social preferences describe the human tendency to not only care about one's own material payoff, but also the reference group's payoff or/and the intention that leads to the payoff. [1] Social preferences are studied extensively in behavioral and experimental economics and social psychology. Types of social preferences include altruism ...