Red Pill TheoryThe Human Irrationality - Scarcity and Loss Aversion (self.TheRedPill)

submitted by ayytemp1


On average, humans are not "rational". More precisely, humans are not always capable of making rational decisions. Not because we are stupid, but simply because it is not always practical or possible to do so. In these cases, we tend to use heuristics in order to make a decision, which works in many situations.

This post serves as a basis of how humans make decisions and the way to influence how other people make decisions.


Heuristics and Biases

What is a heuristic?

A heuristic is any approach to problem solving, learning or discovery that employs a practical method. Rather than being optimal, perfect, logical or rational, a heuristic tries to be sufficient for reaching an immediate goal.

Why do we use heuristics?

When you come across a decision problem, you might not be able to come up with an optimal solution, because it is impractical or impossible to do so. In these situations, our brain automatically use heuristics. Simply because it is efficient and they work fine in most situations and it is not feasible to come up with a satisfying solution using just logic.

The problem with using heuristics

There are situations where heuristics don't work as well as you would expect. These systematic errors produced by heuristics are called biases. Individuals use their perception of the input to create their own subjective social reality and use this reality rather than the objective reality to make decisions or solve problems. This may lead to perceptual distortion, inaccurate judgement and illogical interpretation or what is broadly called irrationality.

Biases do not only arise from heuristics, but also from social influence, emotional or moral reasoning and others.


Scarcity Heuristic


Scarcity in the area of social psychology works much like scarcity in the area of economics. People place a higher value on something that is scarce and a lower value on something in abundance. A very common example is men who are needy. Men who are always needy tend to have a low SMV, simply because their presence is in abundance.

The scarcity heuristic is a value estimation heuristic that places a value on something based on the fact how easily it might be lost, especially to competitors. This heuristic is based on the idea that the more difficult it is to acquire something, the higher the value that it has.


Enhancement of the Scarcity effect

Two psychology principles exist that are able to increase the scarcity effect:


  • Social proof For example, if something is scarce and the demand for it is high, humans have the tendency to interpret that it must have a high value, since everyone else wants it as well. A well known example can be found on web shops with the common phrase 'x items left!'


    This is one of the reasons why things like lifting and looking good works. The SMV of a person is not determined by your own perception, but by the perception of everybody else (social proof).


    Relevant field report: Going To An Event Where You Don’t Know Anyone


  • Commitment and consistency For example, if somebody has committed themselves to something, but suddenly find out that cannot have it anymore, it makes the person want it more.


    One of the popular strategies based from this fact is dread. Be aware that this will only work if the person has already committed to you.


    Relevant field report: Dread works. First experience with this beauty.


Note that the social proof principle is also able to work against something. If the demand is low, people tend to assume that the value must be low, since no one wants it. The scarcity effect will not help in this case.


Loss aversion


Loss aversion is a bias that refers to people's tendency to prefer avoiding losses rather than acquiring equivalent gains. Loss aversion is commonly described as an irrational way of making decisions. A simple example describing this phenomenon is the fact that people feel better when they avoid losing $10 rather than gaining $10.

A visualization of this behavior can be seen in this graph. As seen, the curvatures of the gains is concave, while the curvatures of the losses is convex.



Keep in mind that for your partner a loss is preferred to be avoided rather than acquiring a gain. This is also one of the reasons that makes dread work. These situations can exist whenever your partner is doing something that you strongly disagree with (e.g. talking to another attractive guy). Using dread in these situations gives your partner the following choice:

  • Getting her way (gain)
  • Getting your way (avoiding loss)

Relevant field report: TRP success: Drunk GF gets dread game.

Just make sure not to overuse dread, as this will desensitize the loss feeling when applied.

[–]fuckingoddamnname 12 points13 points  (4 children)

Keep in mind that for your partner a loss is preferred to be avoided rather than acquiring a gain.

Doesn't this contradict the theory of hypergamy?

[–]SasquatchMcKraken 14 points15 points  (0 children)

Nah this is the foundation of dread. They'd rather hold onto what they have if it still has potential, than risk falling out of the tree with a miscalculated branch swing. Ideally, anyway. Remember that feelz and tingles trump all theory and logic.

[–]10211799107 8 points9 points  (0 children)

No it doesn't. A woman wont branch swing unless it's a sure swing.

If they lose you while with you and no other options the loss will seem huge for them.

If they already checked out and have a branch to swing to that's a sure swing, then dread wont work.

[–]Senior EndorsedMattyAnon 2 points3 points  (1 child)

Doesn't this contradict the theory of hypergamy?

On the surface yes.

But for a woman there is a huge psychological difference between "used him as a stepping stone, left him a broken man, got myself an upgrade" and "boyfriend dumped my cheating ass".

If she moves up and the man is distraught, she's happy. Her value is higher than his, that's why he's upset. She's right not to be with a loser like that. He'll never get her back.

If she misbehaves and gets the silent treatment, she thinks... she feels ... lower value than him. She can't move on because he's acting higher value than her. "He seems really happy without me, he's getting on with life, I'm upset and he's already fucking other women who are loving it.... fuck, I've lost myself a catch".

It's weird as all hell that women act/feel/behave like this, but I can assure you it's completely true. Women struggle to move on without proving their value is higher than yours. If she never feels she's won... never feels higher value than you... she will struggle to move on and struggle to get over you. If you show weakness, care too much, cry, beg to have her back she will feel she's better than you and it's friends-only for the rest of your natural life.

It's such a common trope it's almost laughable... girl dumps guy, guy shows complete indifference... girl changes her mind, eg "I don't think I can do this anymore" / "ok, see you around" / "I'm over it now, see you Saturday?"

[–][deleted] 0 points1 point  (0 children)

It's such a common trope it's almost laughable... girl dumps guy, guy shows complete indifference... girl changes her mind, eg "I don't think I can do this anymore" / "ok, see you around" / "I'm over it now, see you Saturday?"

Proof you live in a most fortunate bubble. Jesus. You're bang on right (pun intended) of course. Problem is, it only happens in meat space and hated places of cyber space.

[–]lurkinglimabean 4 points5 points  (0 children)

OP must be an economics major in college they teach this stuff in length in under grad. But all in all this runs true.

[–]TheYekke 3 points4 points  (0 children)

So ask yourself what created this ‘scarcity’, group behavior or local circumstances? I plop you down at a beach in Miami you may have an abundance of women, and a scarcity of trust. Or a need to be fluent in Spanish. Or I’m teleporting you to a Starbucks in Boulder, and suddenly you have to play provider game to get a chick

[–]ayytemp1[S] 2 points3 points  (2 children)

If anyone knows how to link field reports (if it is even possible), please let me know.

[–]1redhawkes 7 points8 points  (1 child)

use archive.is, automod deletes the external links.

[–]ayytemp1[S] 2 points3 points  (0 children)

Thanks, I have edited the links into the post.

[–]matorin57 0 points1 point  (0 children)

Where is the deduction that Loss Aversion doesn't apply to your partner? Your description of Loss Aversion is generic and can be applied to any "rational" being. How does your partner become immune to it? It seems your conclusion is inconsistent with the concept of Loss Aversion and that your are applying Loss Aversion in a way to advance insecurity.

Edit: Emphasis on rational is not my own and has no implications from myself, however since OP decided to emphasize how we are not rational actors I felt it was consistent to provide emphasis.

[–]HeWhistlesNHeRuns 0 points1 point  (0 children)

I think you misinterpret the graph. If getting her way is a gain for her, every adicional unity of value returns a higher value of gain than loss decreased by the same value.