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risk
You ignore the math when certainty is on the table.
The 'pseudocertainty' effect explains why people choose a certain, smaller gain over a larger, statistically superior gamble.
This effect was formally introduced by Kahneman and Tversky in their 1981 paper 'The framing of decisions and the psychology of choice', not the 1979 study.
You pay a high price for the comfort of knowing.
Where this comes from
- Study
- Kahneman and Tversky, 1979, Econometrica
- What the check found
- While the underlying logic is correct, the specific term 'pseudocertainty' and its associated study are misattributed to the 1979 Econometrica paper.
- Confidence
- Solid, with limits
Related
One of these every day, and every one names the study it came from. When a finding is contested, it says so.