1 / 1

Over- and underweighting

From an innovation perspective. “Kahneman’s “Fourfold pattern”. Over- and underweighting. Gains. Gains. Losses. Losses. High probability. High probability. t he Rational Utility line. Low probability. Unlikely events are considerably over weighted by your right brain . Examples:

stella
Download Presentation

Over- and underweighting

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. From an innovation perspective “Kahneman’s “Fourfold pattern” Over- and underweighting Gains Gains Losses Losses High probability High probability the Rational Utility line Low probability. Unlikely events are considerably overweighted by your right brain. Examples: Chance to win €1 million in a lottery is << 1%, still you take a decision to buy a ticket Risk that Your house may burn down is <<1%, still you take a decision to buy a fire insurance Gain of certainty,loss of some money! Gain of hope, loss of much money! High probability Likely events are even more underweighted by your right brain Examples: Chance to win in a court case on €1 million is >>95%, still you agree to settle at €0.8 million Risk that You are about to get bankrupt on the casino is very high. Still You take a large loan from the mafia and bet all on number Zero….. Low probability Gain of certainty, loss of some money! Gain of hope, loss of some money! Low probability the Irrational Utility curve

More Related