When you set out to buy something– a cars and truck, for instance, or a laptop or some little gadget for your kitchen area– you examine the features and the style and the utility of the important things, and after that you choose. However it ends up that there's a psychological force that can influence what you're willing to pay.
On this episode of Choiceology with Dan Heath (), we take a look at a bias that affects how you view gains and losses, how you negotiate offers and the method you think about value.
The episode starts with famous sports agent Leigh Steinberg () He describes his remarkable first attempt at working out a high-stakes contract for a client signing up with the National Football League (). You can read more about his experiences in the sports world in his book The Representative ().
You'll hear an experiment based on Daniel Kahneman () and Amos Tversky's () early research studies that demonstrate the bias in real time.
And legal representative, arbitrator, and conflict resolution expert John Curtis () describes how everybody– from individuals offering their homes to cops informants going into witness protection– can fall prey to this mental trap.
You can learn how to minimize the impact of this bias in your monetary choices in a short article on schwab.com called "Weigh Anchor." ().
Choiceology is an initial podcast from Charles Schwab (). For more on the series, go to schwab.com/podcast.
If you enjoy the program, please leave a ⭐ ⭐ ⭐ ⭐ ⭐ rating or evaluation on Apple Podcasts ().
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