Annie Duke

When we experience what we would think of in the moment as a bad outcome, but I'm going to say in the moment because we've had this discussion, right?

When we experience what we think is a bad outcome, it feels a lot worse to us than a sort of symmetrically good outcome.

So we can think about it this way.

If you lose $50 in blackjack, it feels about as bad to you as winning $100 feels good.

So there's this asymmetry.

Losses feel really bad to us.

So when we're making decisions, we actually sort of over-index on the chances of a bad outcome, right?

So we're not thinking the same way about good outcomes versus bad outcomes in the way that I'm talking about, right?

Like, well, on average, is it going to be good or bad?

And so maybe when you're thinking about the past, you're like, ah, wait, but what if it gets intercepted in that instead of thinking about overall, does this help me win, right?

Okay, so that's loss aversion.

It turns out that this...

like cognitive phenomenon that you just identified.

It's actually really, really like deep.

It's like such a deep concept once you actually think about it.

This idea of I don't want to make a decision because what if the decision I make turns out badly?

That when we stick with the status quo,

We don't think about it as a decision.

So what that means is that we're not loss-averse in the same way.

We're not as worried about bad things happening from the status quo.