Behavioral Economics Vocabulary Flashcard

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Behavioral Economics

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The subfield of economics that applies psychological insights into human behavior

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Cognitive Bias

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A subconscious error in thinking that leads to irrational decision making

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What is Confirmation Bias?

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The tendency to search for information that supports our preconceptions

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Endowment Effect

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The tendency to put more value on things you already own

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What does FOMO stand for?

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Fear of Missing Out

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Hedonic Adaptation

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The tendency to return to a baseline level of happiness after experiences

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What is Herd Mentality?

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The tendency to conform to the behaviors and beliefs of the people around you

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What is Loss Aversion?

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The tendency to regard losses as considerably more important than gains

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Overconfidence Bias

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The tendency to be more confident in one's abilities than is justified

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Overestimation

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When a person believes they are better at something than they actually are