Indexarousal (continued)underprediction of effect of, 98-99understanding different aspects ofourselves and, 104-5arthroscopic knee surgery, 174-76Asian-Americans, stereotypes about,169Assael, James, 23Assael, Salvador, 23-25, 26Association of Petroleum Geologists,211attractiveness, decoy effect and, 11-14,15auctions:arbitrary coherence and, 26-30online, 135-36second price, 28nautomobiles:precautionary devices in, to foilunsafe teenage behavior, 102-3routine maintenance of, 120-21test driving, expectations and, 161automobile sales:FREE! oil changes and, 60-61relativity problem and, 2, 19, 21value in owner's eyes and, 129,134,135BBargh, John, 170Barlow, John Perry, 86Beatles, 85beer:expectations' impact on taste of,157-59, 161-62,163-64, 172ordering process and enjoyment of,231-36behavioral economics:conventional economics vs., xviii-xx,239-40free lunches from perspective of,240-43see also specific topicsBenartzi, Shlomo, 242Bender, Walter, 92benefits (compensation):goodwill created by, 83recent cuts in, 82Berkeley, University of California at,91arousal experiment at, 91-97, 98-99Bertini, Marco, 159-60, 261-62Bible, 208, 215blogging, about overspending and debtproblems, 122-23brain:brand associations of Coke and Pepsiand,166-68honesty and reward centers in, 203,208brand associations, taste of Coke vs.Pepsi and, 166-68bread-making machines, 14-15Brouillet, Jean-Claude, 23-24Buffett, Warren, 17bundling of services, 120-21Burning Man, Black Rock Desert, Nev.,86-88Burrows, Lara, 170Ccable television, "trial" promotionsand,136-37"Can't Buy Me Love," 85Carmon, Ziv, 129, 130, 181, 262Carolina Brewery, Chapel Hill, N.C.,231-37cash, see moneycaudate nucleus, 203CEOs, compensation of, 16-17, 18Charlemagne, 188Charles II, king of England, 188cheating on tests, 198-202extreme cheating and, 221-22honor code statements and, 212-13moral benchmarks and, 206-8, 213with nonmonetary currency ratherthan cash,219-22self-restraint in, 201-2, 208, 213checking accounts, FREE!, 60Chen, Mark, 170childbirth, painkillers during, 103-4China:adoptions in, 134lack of trust in, 214savings rate in, 109270
Indexchocolate:in free exchange (Halloween)experiment, 56-58pricing of, FREE! items and, 51-54,64-65rational cost-benefit analysis and,64-65Clark, Margaret, 68closets, consumerism and size of, 110clothing, worn and returned to store forfull refund, 196, 223Cobb, Leonard, 173-74coffee:questioning outlays for, 44at Starbucks vs. Dunkin' Donuts,37-39,47upscale ambience and, 39,159-60Coke, taste tests of Pepsi and, 166-68cold remedies, price and efficacy of, 184colds, antibiotics as placebo for, 189comparisons, see relativitycompensation:cash vs. gift rewards and, 82-83of CEOs, 16-17, 18poetry reading experiment and,40-42recent cuts in benefits and, 82social exchange in workplace and,80-83and transformation of activity intowork, 39-43see also salariescompensation consulting firms, 17conditioning, placebo effect and, 179condoms:importance of widespreadavailability of, 100-102and willingness to engage inunprotected sex when aroused, 89,95, 96-97, 99,107conflicts:expectations and perception of,156-57,171-72neutral third party and, 172conformity, ordering food and drinkand,238Congress, U.S., 151,152,228ethics reforms in, 204-6consumerism, 109-10context effects, 240control, mistaken perception of, 243corporate scandals, 196, 204, 214, 219,222-23cost-benefit analysis:dishonesty and, 202-3, 204relative value and, 64-65credit cards, 110, 204"ice glass" method for, 122self-control, author's proposal for,123-26, 242two-cycle billing and, 228Crocodile Dundee, 7-8Cypert, Kim, 166-68Ddating:decoy effect and, 10-14,15and likelihood of engaging inimmoral behaviors when aroused,94-95, 96, 97,107separation of social and marketnorms and, 69, 75-76day care, tardiness fines at, 76-77deadlines, setting one's own, 112-16,117, 118-19debt blogging, 122-23decision making:and indecision in face of two choices,151-53sexual arousal and, 89-102, 106-8see also first decisions; optionsdecoy effect, 5-6, 8-15bread-making machines and, 14-15dating and, 10-14,15Economist subscriptions and, 1-3,4-6, 9-10house purchases and, 8-9menu pricing and, 4vacation packages and, 10visual representation of, 9demand:price changes and, 46-47supply and, in standard economicframework, 45-46democracy, dizzying abundance ofoptions in, 148271
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USA $25.95CANADA $27.95• Why do o
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To my mentors, colleagues, and stud
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contentsCHAPTER 4The Cost of Social
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IntroductionHow an Injury Led Me to
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introductionsion of a large magnesi
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introductionAs YOU WILL see in the
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CHAPTER 2The Fallacy of Supplyand D
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the fallacy of supply and demandSaw
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the fallacy of supply and demandan
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CHAPTER 3The Cost of Zero CostWhy W
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the cost of zero costhas huge impli
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the cost of zero costTo replicate t
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the cost of zero costdecision—the
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C HAPTE R 9The Effect of Expectatio
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the effect of expectationsto such c
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the effect of expectationsMina and
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the effect of expectationswill be b
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the effect of expectationsget rid o
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the effect of expectationsby changi
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the effect of expectationsthe way,
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the effect of expectationsResearch
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C HAPTE R I OThe Power of PriceWhy
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the power of priceremoved. The thir
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the power of pricefunerals. By 1785
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the power of pricebetter. And if yo
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the power of pricethe common cold a
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the power of pricewith the same gre
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the power of priceworkouts. Both gr
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the power of priceis nothing "just"
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the power of priceabout placebos an
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CHAPTERItThe Context of OurCharacte
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the context of our character, part
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The Context of OurCharacter, Part I
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