Loss Aversion

Loss Aversion

Short Description: Value of a loss is weighed more heavily than the value of a gain.

CAT ID: CAT-2022-079

Layer: 8

Operational Scale: Tactical

Level of Maturity: Well-Established

Category: Vulnerability

Subcategory: Cognitive Vulnerability

Also Known As: Prospect Theory

Description:

Brief Description: Losses inflict greater significance

Closely Related Concepts: Prospect Theory

Mechanisms: Scarcity, Fear_of_Missing_Out, Endowment

Multipliers: Urgency, Investment, Scarcity

Detailed Description: The lost value of a thing (object, opportunity) is perceived to be greater than the gained value would be of that same thing. *Losing $20 hurts more than finding $20 feels good.

Examples:

Use Case Example(s): An advertisement presents a "limited time offer" to induce loss aversion in the target who is averse to losing the opportunity.

Example(s) From The Wild: A phishing email threatens loss of access to an account unless the recipient immediately clicks on the enclosed link to reset the account credentials.