Acts that seem appropriate in isolation seem unacceptable when viewed from an observer's perspective
For several years, the staff in the psychology department at Newcastle University, in northern England, took tea and coffee from the kitchen without contributing to the honesty box on the counter. A notice nearby asked drinkers to pay a small fee for their beverages-30 pence for tea, 50 pence for coffee, and 10 pence for milk - but the pile of coins inside the honesty box accumulated slowly, while tea, coffee, and milk supplies shrank rapidly (...) As students of human behavior, they recognized that people are guided by weak moral compasses that function much more effectively under surveillance (...) the researchers devised an intervention that merely made people feel as though they were being watched. During a ten-week period, they displayed ten different pictures above the price list for one week each, alternating between images of a pair of eyes and images of flowers. The researchers measured how much milk was consumed as an index of coffee and tea consumption, and counted how much money was in the honesty box at the end of each week. The intervention was a remarkable success. When the image featured a collection of flowers, drinkers paid an average of only 15 pence per liter of milk consumed, whereas they paid 42 pence per liter when the image displayed a pair of eyes (...)
(...) acts that seem appropriate in isolation seem unacceptable when viewed from an observer's perspective.
Today few of us spend more than a few hours alone, so our thoughts and actions come to reflect the presence of the family, friends, and strangers who surround us.
So much of the way we think and behave is molded by these interactions with others that it becomes very difficult to imagine the people we'd become during a week, a month, or even a year of social isolation (...)
Probability is not a mere computation of odds on the dice or more complicated variants; it is the acceptance of the lack of certainty in our knowledge and the development of methods for dealing with our ignorance. Outside of textbooks and casinos, probability almost never presents itself as a mathematical problem or a brain teaser. Mother Nature does not tell you how many holes there are on the roulette table, nor does she deliver problems in a textbook way (in the real world one has to guess the problem more than the solution).
Loss aversion is a notion derived from behavioral economics. In finance, this aversion to loss is reflected in the reluctance ...
A "sunk cost" is just what it sounds like: time or money you've already spent. The sunk-cost fallacy is when you tell yourself that you can't quit because of all that time or money you spent. We shouldn't fall for this fallacy, but we do it all the time.
Dominated Alternatives: Can introducing a third decoy option make you more likely to choose the option, I secretly want you to choose?
In marketing, this is also called the decoy effect or attraction effect or asymmetric dominance effect. A phenomenon whereby the introduction of a third option leads to a change in choice.
Dominated alternatives here quickens the choice patterns of consumers by dulling the relevance of one option by the introduction of another, thereby making one option almost invalid.
More simply, when deciding between two options, an unattractive third option can change the perceived preference between the other two.
Yerkes and Dodson's experiment should make us wonder about the real rela- tionship between payment, motivation, and performance in the labor ...