A fascinating talk by psychologist, Dan Gilbert. Ten years old but worth watching if you haven’t seen it before.
The core point is that people get buyer’s remorse when choices are reversible and become increasingly unhappy with their decision. When choices are irreversible, endowment effects kick in and they become happier with their choice over time. Importantly, most people do not realise that this effect exists.
- Does this have implications for choice architecture? Would it be beneficial to make some choices irreversible to increase the utility gained from them?
- If people are unaware of the effect, will they under-utilise commitment mechanisms that make decisions irreversible?