Cognitive Biases
A list of the most relevant biases in behavioral economics
Biases
Action Bias
Why do we prefer doing something to doing nothing?
Affect Heuristic
Why do we rely on our current emotions when making quick decisions?
Ambiguity Effect
Why do we prefer options we know?
Anchoring Bias
Why do we compare everything to the first piece of information we received?
Attentional Bias
Why do we focus more on some things than others?
Authority Bias
Why do we always trust the doctor, even though they might be wrong?
Availability Heuristic
Why do we tend to think that things that happened recently are more likely to happen again?
Bandwagon Effect
Why do we support opinions as they become more popular?
Barnum Effect
Why do we believe our horoscopes?
Base Rate Fallacy
Why do we rely on specific information over statistics?
Belief Perseverance (The Backfire Effect)
Why do we maintain the same beliefs, even when we are proved wrong?
Benjamin Franklin effect
Why do we like someone more after doing them a favor?
Bikeshedding
Why do we focus on trivial things?
Bottom-Dollar Effect
Why do we transfer negative emotions about being broke on items that we purchase?
Bounded Rationality
Why are we satisfied by “good enough?”
Bundling Bias
Why do we value items purchased in a bundle less than those purchased individually?
Bye-Now Effect
Why are we likely to spend more after reading the word “bye”?
Cashless Effect
Why does paying without physical cash increase the likelihood that we purchase something?
Category Size Bias
Why do we think we’re more likely to win at the big casino versus the small one?
Choice Overload
Why do we have a harder time choosing when we have more options?
Cognitive Dissonance
Why is it so hard to change someone's beliefs?
Commitment Bias
Why do people support their past ideas, even when presented with evidence that they're wrong?
Confirmation Bias
Why do we favor our existing beliefs?
Decision Fatigue
Why do we make worse decisions at the end of the day?
Declinism
Why do we think the past is better than the future?
Decoy Effect
Why do we feel more strongly about one option after a third one is added?
Disposition Effect
Why do we tend to hold on to losing investments?
Distinction Bias
Why do we view options as more distinct when evaluating them simultaneously?
Dunning–Kruger Effect
Why do we fail to accurately gauge our own abilities?
Einstellung Effect
Why do our past experiences prevent us from reaching the best possible outcome?
Empathy Gap
Why do we mispredict how much our emotions influence our behavior?
Endowment Effect
Why do we value items more if they belong to us?
Extrinsic Incentive Bias
Why do we think others are in it for the money, but we’re in it for the experience?
False Consensus Effect
Why do we overestimate agreement?
Framing Effect
Why do our decisions depend on how options are presented to us?
Functional Fixedness
Why do we have trouble thinking outside the box?
Fundamental Attribution Error
Why do we underestimate the influence of the situation on people’s behavior?
Gambler's Fallacy
Why do we think a random event is more or less likely to occur if it happened several times in the past?
Google Effect
Why do we forget information that we just looked up?
Halo Effect
Why do positive impressions produced in one area positively influence our opinions in another area?
Hard-easy effect
Why is our confidence disproportionate to the difficulty of a task?
Heuristics
Why do we take mental shortcuts?
Hindsight Bias
Why do unpredictable events only seem predictable after they occur?
Hot Hand Fallacy
Why do we expect previous success to lead to future success?
Hyperbolic Discounting
Why do we value immediate rewards more than long-term rewards?
IKEA Effect
Why do we place disproportionately high value on things we helped to create?
Identifiable Victim Effect
Why are we more likely to offer help to a specific individual than a vague group?
Illusion of Control
Why do we think we have more control over the world than we do?
Illusion of Transparency
Why do we feel that others can read our mind?
Illusion of Validity
Why are we overconfident in our predictions?
Illusory Correlation
Why do we think some things are related when they aren’t?
Illusory Truth Effect
Why do we believe misinformation more easily when it’s repeated many times?
Impact Bias
Why do we overestimate our emotional reactions to future events?
In-group Bias
Why do we treat our in-group better than we do our out-group?
Incentivization
Why do we work harder when we are promised a reward?
Just-World Hypothesis
Why do we believe that we get what we deserve?
Lag Effect
Why does spacing out the repetition of information make one more likely to remember it?
Law of the Instrument
Why do we use the same skills everywhere?
Less-is-Better Effect
Why do our preferences change depending on whether we judge our options together or separately?
Leveling and Sharpening
Why do we exaggerate some details of a story, but minimize others?
Levels of Processing
Why do we remember information that we attach significance to better than information we repeat?
Look-elsewhere Effect
Why do scientists keep looking for a statistically significant result after failing to find one initially?
Loss Aversion
Why do we buy insurance?
Mental Accounting
Why do we think less about some purchases than others?
Mere Exposure Effect
Why do we prefer things that we are familiar with?
Messenger Effect
Why do we find some people more credible than others?
Motivating Uncertainty Effect
Why are we more motivated by rewards of unknown sizes?
Naive Allocation
Why do we prefer to spread limited resources across our options?
Naive Realism
Why do we believe we have an objective understanding of the world?
Negativity Bias
Why is the news always so depressing?
Noble Edge Effect
Why do we tend to favor brands that show care for societal issues?
Normalcy Bias
Why do we believe that nothing bad is going to happen?
Nostalgia Effect
How do our sentimental feelings for the past influence our actions in the present?
Observer Expectancy Effect
Why do we change our behavior when we’re being watched?
Omission Bias
Why don’t we pull the trolley lever?
Optimism Bias
Why do we overestimate the probability of success?
Ostrich Effect
Why do we prefer to ignore negative information?
Overjustification Effect
Why do we lose interest in an activity after we are rewarded for it?
Peak-end Rule
How do our memories differ from our experiences?
Pessimism bias
Why do we think we’re destined to fail?
Planning Fallacy
Why do we underestimate how long it will take to complete a task?
Pluralistic Ignorance
Why do we think our beliefs are different from the majority?
Primacy Effect
Why do we only remember the first things on our grocery list?
Priming
Why do some ideas prompt other ideas later on without our conscious awareness?
Projection Bias
Why do we think our current preferences will remain the same in the future?
Reactive devaluation
Why is negotiation so difficult?
Recency Effect
Why do we better remember items at the end of a list?
Regret Aversion
Why do we anticipate regret before we make a decision?
Representativeness Heuristic
Why do we use similarity to gauge statistical probability?
Response Bias
Why do we give false survey responses?
Restraint Bias
Why do we overestimate our self-control?
Rosy Retrospection
Why do we think the good old days were so good?
Salience Bias
Why do we focus on items or information that are more prominent and ignore those that are not?
Self-serving Bias
Why do we blame external factors for our own mistakes?
Serial Position Effect
Why do we better remember items at the beginning or end of a list?
Sexual Overperception Bias
Why do men think that women are always flirting with them?
Social Norms
Why do we follow the behavior of others?
Source Confusion
Why do we forget where our memories come from?
Spacing Effect
Why do we retain information better when we learn it over a long time period?
Spotlight Effect
Why do we feel like we stand out more than we really do?
Status Quo Bias
Why do we tend to leave things as they are?
Suggestibility
Why is yawning contagious?
Survivorship Bias
Why do we misjudge groups by only looking at specific group members?
Take-the-best Heuristic
Why do we focus on one characteristic to compare when choosing between alternatives?
Telescoping Effect
Why do some things “seem like they just happened yesterday?”
The Illusion of Explanatory Depth
Why do we think we understand the world more than we actually do?
The Pygmalion effect
Why do we perform better when someone has high expectations of us?
The Sunk Cost Fallacy
Why are we likely to continue with an investment even if it would be rational to give it up?
Zero Risk Bias
Why do we seek certainty in risky situations?
