Psychology of Economic Decision-Making
Memory bias refers to the cognitive distortion that affects how we recall past experiences and events, leading to inaccurate or selective memories. This bias can significantly influence decision-making by altering the way we evaluate choices based on our recollections of previous outcomes, particularly in contexts of regret and anticipation. It affects how individuals perceive their past decisions, often leading them to remember negative outcomes more vividly than positive ones, thus impacting future choices.
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