The Sale Made at the Bottom - the behaviour gap

The Cognitive Biases board is a gallery of the mind’s shortcuts that misfire the same way every time: loss aversion, availability, hindsight. This lesson watches those shortcuts work on money, and measures what they cost.

Before you start. Three earlier lessons do the groundwork. Cognitive Biases showed that a bias is a mental shortcut that leans the same way every time, so it can be predicted. Decision-Making Under Uncertainty showed that a loss hurts about twice as much as the same gain pleases, and Mental Models & Decision-Making (thinking about thinking) showed why a good decision can have a bad outcome, and the other way round. From this track you need the tank from Nineteen and Six - where the water goes.