Cognitive Biases Flashcards
Bandwagon Effect
Tendency to do or believe things because many other people do
Bias Blind Spot
Tendency not to compensate for one’s own cognitive biases
Even when told you are biased, you will underestimate the effects
Choice-supportive Bias
Tendency to retroactively ascribe positive attributes to an option one has selected
Confirmation Bias
Tendency to search for or interpret information in a way that confirms one’s preconceptions
Congruence Bias
Tendency to test hypotheses exclusively through direct testing
Contrast effect
Enhancement or diminishment of a weight or other measurement when compared with recently observed contrasting object
You are judged more physically attractive fi you are standing next to your ugly friend
Deformation professionnelle
tendency to look at things according to the conventions of one’s own profession, forgetting any broader point of view
Professional training distorts your worldview
“When you have a hammer, everything looks like a nail”
Disconfirmation Bias
Tendency for people to extend greater critical scrutiny to information which contradicts their prior beliefs
Same as confirmation bias in reverse
Endowment effect
Tendency for people to value something more as soon as they own it
Inconsistent with standard economic theory willingness to pay (WTP) should = willingess to accept (WTA)
Focusing Effect
Placing too much importance on one aspect of an event
AKA anchoring effect
Using odometer readings to value a used car over maintenance records
Hyperbolic discounting
People generally prefer smaller, sooner payoffs to larger, later payoffs
Illusion of control
The tendency for human beings to believe that can control at least influence outcomes which they clearly cannot
Impact bias
Tendency for people to overestimate the length or the intensity of the impact of future feeling states
Applies to both positive and negative emotions
Information bias
tendency to seek information even when it cannot affect action
fallacy that if we can get more information we can make better decisions
information that is not worth knowing is not worth acquiring
Loss aversion
Tendency for people to strongly prefer avoiding losses over acquiring gains
People generally risk averse
Pain of losing $100 is greater than the pleasure of winning $100
Neglect of Probability
Tendency to completely disregard probability when making a decision under uncertainty
Seat belt example
Mere exposure effect
Tendency for people to express undue liking for things merely because they are familiar with them
Omission bias
Tendency to judge harmful actions as worse, or less moral, then equally harmful omissions (inactions)
Outcome bias
Tendency to judge a decision by its eventual outcome instead of based on the quality of the decision at the time it was made
Planning fallacy
Tendency to underestimate task-completion times
Pseudocertainty effect
Tendency to make risk-averse choices if the expected outcome is positive
but make risk-seeking choices to avoid negative outcomes
Selective perception
Tendency for expectations to affect perception
If you believe, make it true
Similar to placebo effect
Status quo bias
Tendency for people to like thing to stay relatively the same
Von Restorff effect
Tendency for an item that “stands out like a sore thumb” to be more likely to be remembered than other items
Zero-risk bias
Preference for reducing a small risk to zero over a greater reduction in a larger risk
Prefer small benefits that are certain to large ones that are uncertain
