The link that Julie provided was fascinating to me: near-wins far more painful than obvious losses.

Without getting too heavy, I think this is reflected by an industry that calls itself gaming rather than gambling.

Great post. I don’t think we have Swoop but I do get loads of emails telling me they’ve ‘just sold a PlayStation for £11.62′ and even a hard-bitten rationalist (cough) like me wondered how this was possible and was tempted to have a look.

http://www.marginalrevolution.com/.m/marginalrevolution/2009/11/how-to-sell-a-dollar-for-more-than-a-dollar.html

As David Zetland points out in the short video above, though, it’s way bigger than a smart retailer price-gouging. The Dollar Auction is essentially how politics works.

I think David Zetland shows a pretty good demonstration for good in the video above, Julie. Drawing attention to cognitive bias is important for learners. And this one’s a doozy demonstration-wise.

Thanks so much for the link to The Frontal Cortex. I hope others read it. I think one piece that Lehrer quotes is worth repeating:

It turns out that [in an experiment] near-misses activate almost exactly the same dopamine circuits as actual wins – but here’s the punchline – they were subjectively experienced as the most unpleasant outcome, even worse than total misses.

Interestingly, although near-misses were experienced as aversive they increased the desire to play the game but only when the person had some perception of control, by choosing what the ‘lucky’ picture would be. Of course, like choosing ‘heads or tails’, it’s only an illusion of control because the outcome is random anyway.

Jonah Lehrer wrote an interesting piece about Swoopo you might like:

http://scienceblogs.com/cortex/2009/07/swoopo.php

I keep trying to figure out how to use these things for Good (learning), rather than Evil :)