One extension of loss aversion that often results in needless risk taking and more loss than we’d normally tolerate is called the break-even effect. It was first identified by the behavioral economists Richard Thaler and Eric Johnson, who argue that when we lose money and have a chance to win it back right away, or even come out ahead, not only do we take more risk, but we take even bigger risks and thereby subject ourselves to even bigger losses. If we want to avoid loss, it would be better to just walk away. The break-even effect explains your conviction that the next hand of blackjack or
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