{"id":240,"date":"2015-02-01T13:57:32","date_gmt":"2015-02-01T18:57:32","guid":{"rendered":"http:\/\/hannahatkin.com\/blog\/?p=240"},"modified":"2015-02-01T13:57:32","modified_gmt":"2015-02-01T18:57:32","slug":"loss-aversion","status":"publish","type":"post","link":"https:\/\/hannahatkin.com\/blog\/loss-aversion\/","title":{"rendered":"Loss Aversion"},"content":{"rendered":"<p><strong>Word:<\/strong> Loss aversion<\/p>\n<p><strong>Definition:\u00a0<\/strong>The idea that loss is felt more acutely than gain and as a result, people overwhelmingly choose to avoid loss over acquiring gain.\u00a0This principle contends with\u00a0the theory of <a href=\"http:\/\/psych.hanover.edu\/classes\/cognition\/papers\/tversky81.pdf\">rational choice<\/a>.<\/p>\n<p><strong>Reference:\u00a0<\/strong>The term comes from economics and decision theory and was<strong>\u00a0<\/strong>brought to light by psychologists\u00a0Daniel Kahneman and Amos Tversky. They\u00a0demonstrated that even something as simple as a coin toss can evoke\u00a0aversion to loss. Kahneman discussed this concept in recent <a href=\"http:\/\/www.nytimes.com\/2013\/12\/09\/your-money\/overcoming-an-aversion-to-loss.html\">interviews<\/a> describing,\u00a0\u201cIn my classes, I say: \u2018I\u2019m going to toss a coin, and if it\u2019s tails, you lose $10. How much would you have to gain on winning in order for this gamble to be acceptable to you?\u00a0People want more than $20 before it is acceptable. And now I\u2019ve been doing the same thing with executives or very rich people, asking about tossing a coin and losing $10,000 if it\u2019s tails. And they want $20,000 before they\u2019ll take the gamble.\u201d<\/p>\n<p>Essentially, people are willing to forego winning large amounts of money because the fear of losing, even when the amount is considerably less, is too consuming.<\/p>\n<p><strong>Thoughts\/Questions:\u00a0<\/strong>Designers use loss aversion in a variety of ways to evoke such feelings on their\u00a0users. A great example is canceling subscriptions or services. If a users tries to delete her Facebook account she is shown images of her friends with the words \"[Friend's name] will miss you!\" Here, Facebook is trying to play into loss aversion by showing the user what she will be missing by leaving the service.<\/p>\n<p>Everyone wants to be win, but we would much rather just not lose!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Word: Loss aversion Definition:\u00a0The idea that loss is felt more acutely than gain and as a result, people overwhelmingly choose to avoid loss over acquiring gain.\u00a0This principle contends with\u00a0the theory of rational choice. Reference:\u00a0The term comes from economics and decision theory and was\u00a0brought to light by psychologists\u00a0Daniel Kahneman and Amos Tversky. They\u00a0demonstrated that even something [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":243,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[73,18,17],"tags":[75,74,8,9],"class_list":["post-240","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-marketing","category-psychology","tag-fear-of-loss","tag-loss-aversion","tag-user-experience","tag-ux"],"_links":{"self":[{"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/posts\/240","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/comments?post=240"}],"version-history":[{"count":3,"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/posts\/240\/revisions"}],"predecessor-version":[{"id":244,"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/posts\/240\/revisions\/244"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/media\/243"}],"wp:attachment":[{"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/media?parent=240"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/categories?post=240"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hannahatkin.com\/blog\/wp-json\/wp\/v2\/tags?post=240"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}