Anchoring is a cognitive bias that describes the common human tendency to rely heavily on the first piece of information (the “anchor”) encountered when making decisions.
Attribution Error refers to the cognitive bias where individuals attribute too much importance to personal characteristics and too little to situational factors when explaining others' behavior.
Bias refers to a systematic deviation or prejudice in judgment that can impact decision-making, sampling, forecasting, and estimations. This term is significant in fields like Behavioral Finance, Statistics, Psychology, and Sociology.
Cognitive Bias refers to systematic patterns of deviation from norm or rationality in judgment where individuals create their subjective reality from their perception of the input.
Confirmation Bias: The tendency to search for, interpret, favor, and recall information that confirms one’s pre-existing beliefs or hypotheses.
An in-depth look into the Framing Effect, exploring how the presentation of choices can influence decision-making behaviors. Includes examples, types, historical context, and related terms.
The Fundamental Attribution Error is the tendency to overemphasize personal characteristics and ignore situational factors when judging others' behaviors. This article provides a comprehensive understanding, including historical context, types, key events, detailed explanations, and more.
A comprehensive exploration of misjudgment, its definition, causes, consequences, and examples across various fields.
Exploring the Cognitive Bias Where Individuals Overestimate the Likelihood of Positive Events and Underestimate the Potential for Negative Events.
Overconfidence Bias: A cognitive bias characterized by an individual's excessive confidence in their own abilities or knowledge. It occurs when investors overestimate their knowledge or ability to predict market movements, leading to undue risk-taking.
Overestimation refers to the cognitive bias where an individual or group assesses their abilities, knowledge, or influence as greater than they actually are.
Perceptual Vigilance refers to the psychological tendency to notice stimuli that are particularly relevant to one's interests or needs.
Self-serving bias is a psychological phenomenon where individuals attribute their successes to personal factors while blaming external factors for their failures. This article delves into the historical context, key examples, implications, and more.
The Sunk Cost Fallacy is the phenomenon whereby decision-makers continue investing in a project due to the amount already invested, despite new evidence suggesting that the cost will not be recovered.
The Halo Effect refers to the cognitive bias where one's perception of a person in one area heavily influences their overall judgment in other areas. This can result in either positive or negative opinions about a person based on a single trait or performance aspect.
Money Illusion refers to the cognitive bias where individuals mistakenly believe that an increase in their nominal income equates to an increase in their real purchasing power, neglecting the effect of inflation.
A comprehensive exploration of the anchoring and adjustment heuristic, its definition, applications in business and finance, and its psychological underpinnings.
Understanding anchoring in investing, including its definition, examples, psychological impact, and strategies to mitigate its effects.
An in-depth analysis of the Endowment Effect, an emotional bias where people value owned objects more highly than their market value. Learn about the causes, implications, and examples of this phenomenon.
The Gambler's Fallacy is an erroneous belief that a random event is more or less likely to happen based on the results from a previous series of events. This entry explores the fallacy's implications, examples, and the psychological reasoning behind it.
The halo effect is a cognitive bias whereby a consumer's positive perception of a maker's products influences their perceptions of other products by the same maker. This entry explores the overview, history, examples, and implications of the halo effect in consumer behavior.
An in-depth exploration of the Hot Hand Phenomenon, including its definition, underlying mechanisms, empirical evidence, and implications across various domains.
A comprehensive overview of mental accounting, including its definition, the cognitive biases involved, and practical examples for better financial decision-making.
An in-depth explanation of outcome bias, including its definition, how it works, its implications in decision-making, and ways to mitigate it.
