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Rationality

Why we buy insurance for the wrong things

Before we try to fix people, it is worth understanding what they are for.

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A mind, and the things that move it. Photograph: The Unreasonable Human

The measure that matters is not what people say about nostalgia but what they do when nobody is scoring. Economists have spent decades modelling nostalgia as a quantity. It behaves more like a weather system. Consider the empty diary. It is a small thing, and small things are where habits live. Ask most people why they did what they did and they will give you a reason; ask them again a week later and the reason will have quietly changed.

Why it persists

The strange thing about the empty diary is not that it exists but that it works, most of the time, for most people. The evidence here is thinner than the confident commentary suggests, and the honest position is a shrug with a direction of travel. The textbook treats nostalgia as a preference to be revealed. In practice it is a story we tell ourselves after the fact. Economists have spent decades modelling nostalgia as a quantity. It behaves more like a weather system.

RationalityBehaviourLoss aversion
Alina Petrova
Alina Petrova — Editor-in-chief

Alina Petrova is a Year 12 student preparing to apply to university, and the founder and editor of The Unreasonable Human. She reads across psychology, economics, behavioural science and neuroscience, and writes about the gap between how people are supposed to decide and how they actually do.

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