01_P & B - Chapter 02

• Affect heuristic
• Projection bias
• Endowment effect
• Scarcity heuristic 
• Overconfidence
• Fundamental attribution error

between "Risk as feelings" and " Risk as analysis"

Risk as feelings: Instinctive and intuitive reactions to danger (Intuitiv)

Risk as analysis: Logic, deliberate assessment of risks (logisch/bewusst)

Humans frequently assess risk as feelings, although they might (try to) convince
themselves and others that the assessment is based on analysis

(Risiken werden häufig als Gefühle eingestuft, auch Menschen überzeugt sein wollen, dass sie logisch und bewusst bewertet wurden)

Used while judging the risks and benefits of something, depending on the positive or
negative feelings related to the stimulus

Risks & Benefits

Positive feelings:

• risks are judged as low
• the benefits as high

Negative feelings:

• risks are judged as high
• benefits as low

likely under time pressure/constraints, i.e. when people's opportunity for analytic consideration is reduced and an efficient mode of judgment is needed

wenn die Menschen weniger Gelegenheit zum analytischen Nachdenken haben und eine effiziente Urteilsbildung erforderlich ist.

Information about benefit or risk could influence the affective evaluations (positive or negative) and lead to conclusions about risk and benefit that are affectively consistent with the information given

Note: people were only informed about the risk or only about the benefit -> hence,
they had no information on benefits or risks respectively. Instead they used the affect
heuristic to judge the benefits or risks (i.e. they were guided by their feelings)

people were only informed about the risk or only about the benefit hence,
they had no information on benefits or risks respectively. Instead they used the affect
heuristic to judge the benefits or risks (i.e. they were guided by their feelings)

die Menschen wurden nur über das Risiko oder nur über den Nutzen informiert -> sie hatten also keine Informationen über das jeweilige andere (Nutzen bzw. Risiken). Stattdessen nutzten sie die Affektheuristik, um die Vorteile oder Risiken zu beurteilen (d. h. sie ließen sich von ihren Gefühlen leiten).

• Evaluative judgments on one affective attribute (risk/benefit) can be influenced by experimentally manipulating information on another affective attribute (benefit/risk)
• Is consistent with the idea that people use the affect heuristic to make judgments about risk and benefit
• When the manipulation worked (i.e., when information increased perceived risk or benefit), the expected affectively congruent but inverse effect was found on the nonmanipulated attribute (i.e., perceived benefit or risk decreased)
• This provides evidence that the inverse relationship between perceived risk and perceived benefit found in Study 1 is causally determined

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• Urteile über Risiko/Nutzen können durch Manipulation von Informationen über das jeweils andere affektives Attribut (Nutzen/Risiko) beeinflusst werden.
• Menschen nutzen die Affektheuristik nutzen, um Urteile über Risiko und Nutzen zu fällen 
• Wenn die Manipulation funktionierte (erhöhung wahrgenommenes Risiko oder Nutzen), wurde der umgekehrte Effekt auf das nicht manipulierte Attribut gefunden (d. h., der wahrgenommene Nutzen oder das Risiko nahm ab) 
• Dies ist ein Beweis dafür, dass die in Studie 1 festgestellte inverse (umgekehrte) Beziehung zwischen wahrgenommenem Risiko und wahrgenommenem Nutzen kausal (ursächlich)  bedingt ist.

(Kausal: auf dem Verhältnis zwischen Ursache und Wirkung beruhend)

People overestimate the degree to which their future tastes will resemble their
current tastes, hence their current state plays “too large” a role in their decisions

people attempt to come up with an unbiased estimateof what their affective state will be in the future, but their assessment is contaminated by unique influences of their current well-known affective state

e.g. planning and saving for the retirement -> people may have a higher consumtion in the future than today -> protection bias

go to the supermarket if you are hungry -> you buy to much things, because you think thank you are that hungry in the next days

People under-appreciate their habit formation -> this may lead to projection bias in planning for the future, such as retirement savings