Advertisement

(Ad Space)

Browse & Filter Biases

Showing 187 biases.

Too Much Information

We notice when something has changed

Money illusion

Description

The tendency of people to think of currency in nominal, rather than real, terms.

Example 1:

Employees might feel satisfied with a 2% raise in a year with 3% inflation, even though their real purchasing power has decreased, because their nominal income increased.

Example 2:

Employees may feel satisfied with a 2% salary increase in a year with 3% inflation, even though their real purchasing power has decreased, because they focus on the nominal increase.

Advertisement

(Ad Space)