Collector’s Edition! We can sometimes irrationally over (or under) value something based on how accessible it is. E.g., we are prone to overvalue things that are harder to get, and this can often provoke hasty decisions.
The Representativeness Heuristic occurs when we judge the likelihood of an outcome based on how closely it resembles previous outcomes associated with the same agent or situation. We tend to irrationally undervalue information that violates our expectations, and overvalue information that is consistent with our expectations.
For example: when predicting who will be more punctual between two people one may choose the person with neat and tidy hair (prototypical standard of someone who is organized) over the person with long shaggy hair.
A bird in the hand… Loss Aversion describes our tendency to be more sensitive to the negative impact of losing something than the positive aspects of gaining something of identical value.
For example: a person may be more motivated to avoid losing $100 than they would be to gain $100.
We will often incur costs to keep an option available even if we do not find that option inherently attractive. Threatening to take away an option can therefore make it more attractive than it would otherwise be. We can actually place more value on the freedom associated with multiple options, than we value any of the options themselves.
Judging a book by its cover. Our responses to identical conditions can change depending on the manner in which they are presented.
The sum of the parts is greater than the whole? The Conjunction Fallacy refers to our tendency to believe that specific conditions are more probably than the general conditions that they are a subset of. We can become easily distracted into thinking something is more probable than it is through the deliberate inclusion of specific details.
You can't beat a sure thing! Reductions in the chances of a desired event occurring usually lead to negative psychological effects. This feeling is even more pronounced when the reduction occurs from a position that had a 100% chances of occurring.
For example: Moving from a certain probability (100%) of winning a reward to a smaller probability of winning a reward (80%) creates a larger psychological effect than if the probability is moving from uncertainty (80%) to another uncertain probability (60%), even if the ultimate value decreases by the same amount (20%).
Missing the forest for one tree – Also known as Base Rate Neglect, this biased describes our tendency to ignore general or generic information (e.g., crime rates in our neighborhood) when we are exposed to information pertaining to a specific case or incident (e.g., experiencing or witnessing a crime). We often get distracted from common (and relevant) information by small details that lead us to irrationally overestimate the likelihood of some outcomes, and underestimate others.
For example: a parent may believe their child will be accepted to a prestigious school because they are brilliant without recognizing that only 5% of students are admitted.
This ALWAYS happens! This bias refers to our tendency to assess the frequency or probability of an event based on how easily instances of that event can be brought to mind.
The availability heuristic operates on the notion that, “if you can think of it, it must be important.” For example: after seeing multiple news stories on car theft you might believe that car theft is more prevalent in your neighborhood than it actually is.
What was the question again? Attribute Substitution occurs when a person is faced with a complex question and unknowingly simplifies it to provide a response that they think is relevant, but may not be.
It is seen in domains as diverse as judging a politician’s competence based on his face, and judging life satisfaction based on current mood.