Bias is a tendency to prefer one option over others in a way that is not based on reason or evidence. In behavioral economics, bias refers to the various cognitive and emotional factors that can influence people’s decision-making. These biases can lead people to make decisions that are not in their own best interests or that do not align with their goals and preferences. Examples of common biases in behavioral economics include the sunk cost fallacy, the framing effect, and the availability heuristic. Understanding these biases can help people to make more rational and informed decisions, and can also be useful for policymakers and businesses who want to design policies and products that take into account how people actually make decisions.
