Webs of Influence: The Psychology of Online Persuasion, 2nd Edition

Chapter 15

Pricing and value

“People’s attitudes and feelings about losses and gains are really not symmetric. So we really feel more pain when we lose $10,000 than we feel pleasure when we get $10,000.

DANIEL KAHNEMAN, PYSCHOLOGIST

Loss aversion

As we explored earlier, many of the things we enjoy (money, sports cars, attractive faces) give us pleasure by stimulating the reward (mesolimbic) system in the brain. So, if gaining something makes us feel good, then isn’t parting with it going to hurt?

In a seminal piece of research conducted in the 1970s, behavioural economists Kahneman and Tversky famously stated that ‘losses loom larger than gains’.¹ The idea that we prefer avoiding losses to acquiring equivalent gains implies that we ascribe ...