Latest / Behavioral Economics with Fexingo: Decision Making, Bias, and How People Really Spend
Why Your Brain Treats a Frequent Flyer Mile as Real Money
Episode 110 of Behavioral Economics with Fexingo: Lucas and Luna explore the endowment effect in loyalty points—specifically how Delta Air Lines' 2023 SkyMiles devaluation triggered an emotional response more intense than a cash price hike. Drawing on Nobel laureate Richard Thaler's mental accounting and the 'pain of paying' research by Drazen Prelec and George Loewenstein, they walk through why travelers hoard miles as if they were personal property, and why airlines profit by making points feel like real currency until they aren't. The hosts examine a University of…
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