We have already seen that human decision making is complex and is not always related to the value or the utility of a material (or money). Tversky and Kahneman describe another survey on two groups of people, about 200 people each.
To group #1:
Imagine you paid $10 for a ticket to a play. You reached the theatre and discovered that you had lost the ticket. Will you spend $10 on another ticket?
54% of the people said NO to that question. Apparently, half of the people thought $20 was too expensive for a ticket.
To group #2:
Imagine you went for a play where admission is $10 per ticket. You reached the theatre and discovered that you had lost a $10 bill. Will you spend $10 on a ticket?
88% of the respondents said YES to the purchase.
Same loss, different feelings
The main difference is that, in the second case, the lost dollar was not accounted for the ticket purchase. And $10 on the ticket was a different event unconnected to the loss of $10. I lost a 10 dollar bill due to negligence, but that doesn’t deprive me of watching the play (or it is a good distraction to forget my loss)!.
On the other hand, the re-purchase of the ticket is a painful decision; spending double on a ticket that happened due to my carelessness!
Tversky, A.; Kahneman, D., Science, 1981, 211, 453
