Day 53 of 150 Logic Difficulty 5/10
Losses hurt about twice as much as same-sized gains
Quick answer
Losses hurt about twice as much as same-sized gains. Today's question (Loss aversion) asks about a finding from Tversky, A., & Kahneman, D. in 1991. The correct option is ~2:1 — full explanation, primary source, and glossary cross-links below.
Today's question
Tversky & Kahneman (1991) estimated that, for typical decisions, the psychological pain of a loss outweighs the pleasure of an equivalent gain by approximately:
Reveal the answer and explanation
Correct: B — ~2:1
Across coin-flip-style monetary gambles, riskless-choice valuations, and endowment-effect studies, the median loss-aversion coefficient — the ratio of marginal disutility of a loss to marginal utility of a same-sized gain — sits around 2:1 (about 1.5 to 2.5 across studies). Loss aversion grounds prospect theory's S-shaped value function and predicts the disposition effect in finance, status-quo bias, the endowment effect, and asymmetric dominance in pricing. Recent work has tightened estimates and shown loss aversion attenuates with experience but rarely vanishes.
About the source
Tversky, A., & Kahneman, D. (1991). Loss aversion in riskless choice: A reference-dependent model. Quarterly Journal of Economics, 106(4), 1039–1061.
Every Cognition Bible question cites a primary source — a paper, book chapter, or monograph that exists, that we can point to on Google Scholar, and whose finding the question accurately summarizes. No fabricated authority strings, no name-drops without paper-level grounding.
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