Latest / Behavioral Economics with Fexingo: Decision Making, Bias, and How People Really Spend
Why Your Brain Treats a Loyalty Card as a Free Pass to Overpay
Episode 103 of Behavioral Economics with Fexingo dives into the psychological trap of loyalty programs. Lucas and Luna explore how your brain treats a punch card or rewards app not as a discount incentive, but as a justification to pay full price — and often more. The episode centers on a 2018 study from the University of Chicago showing that customers at a coffee chain spent 12% more per visit after they received a loyalty card, compared to those who didn't have one. Lucas breaks down the 'licensing effect' — how earning a future reward makes us feel entitled to indulge now…
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