PN: Negativity bias in percents

Keywords:: PermanentNote

Reference: fleetingNote

The negativity is the notion that even when of equal intensity, things of a more negative nature have a greater effect than neutral or positive things.

The negativity bias is also well expressed in percents. We can gain many hundreds of percents but we can only lose hundred. If you have $100 and you gain 1,000%, you'll have $1,100; however, if you loose 100% you'll have 0. You can't lose 1,000 – you can't even lose 101%.

Therefore, incrementally each percent lost will have a way bigger impact than a percent gained. Because a negative percent lost will have the value of 1/100, but a percent earned will have the value of 1/∞ or 1/100+, so it's way smaller. It's strange, but it seems true.

What are the advantages and disadvantages of this situation? What are the pros and cons of not having a cap for gain?

One negative might be that we can always want more of it, ultimately bringing us misery? A positive might be that it can't end – we can be eternally happy, but we can suffer only once. You can die once but feel joy without a limit. Is that the basis for the concept of the afterlife?

So it's not only the practical reason we have the negativity bias: those who were too optimistic died – e.g., eaten by a tiger because they weren't afraid enough – but also logical: you can't go farther than 0, but you can go into infinity.

For further exploration

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