Latest / Behavioral Economics with Fexingo: Decision Making, Bias, and How People Really Spend
Why Your Brain Treats a Discount as a Reward
Episode 101 digs into the 'discount-as-reward' effect — why your brain fires dopamine when you see a sale tag, even if you weren't planning to buy. Hosts Lucas and Luna explore the 2024 Stanford study that found shoppers' brains treat a 20 percent discount on a product they already wanted the same way they treat a $5 cash windfall. They discuss why retailers like REI have experimented with member-only discounts that feel like earned treats rather than price cuts, and how that strategy backfired during the 2020 camping boom. Lucas explains the neural mechanism: the ventral…
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