By David Gal
University of Illinois
June 5, 2018
Daniel Kahneman, a winner of the 2002 Nobel Prize in Economics, wrote that “The concept of loss aversion is certainly the most significant contribution of psychology to behavioral economics.” When Richard Thaler, the father of behavioral economics, won the Nobel Prize in Economics in 2017, the phrase “loss aversion” appeared 24 times in the Nobel Prize committee’s description of his contributions to science.
Why have people attributed such profound importance to loss aversion? More…