Variable Rewards Trick - Deepstash

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Framing Reward is as Important as Reward Itself

Variable Rewards Trick

Customers come back due to some variable rewards. These can be: a new tweet, a special offer at a restaurant, or a fresh new deal at a shop.

Variable rewards, which have an element of uncertainty and unpredictability, work like a slot machine for our brains. Smart framing focuses on the time and money the customer has already spent, instead of what they can get.

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The Error in Isolating Events
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  • Many studies have been conducted regarding the psychological impact of a one particular event, like the trauma associated with the ongoing health crisis, or sudden job loss....
Good News, Bad News

A comprehensive study on Australian households, measuring the quality of wellbeing over 16 years found the following results:

  1. The biggest emotional scars come from deaths, divorce, and heavy financial losses.
  2. Negative events linger in the mind for much longer than the positive ones.
  3. The emotional costs involved with separation (like from a spouse) can be significant, and should be avoided unless completely necessary.
  4. Problems rarely come all at once, and most people recover, showing resilience and adaptability.
You Remain What You Are

Our level of wellbeing does not change much, with each event, even a catastrophic one, impacting us for a length of time, say a year or two, and then becoming normal to our minds, returning us to our previous levels of wellbeing.

This applies to boosts as well as the plunges.

Two of the biggest innovations
Two of the biggest innovations

Two of the biggest innovations of modern times are cars and airplanes. At first, every new invention looks like a toy. It takes decades for people to realise the potential of it.

Innovation is driven by incentives

There are three types of incentives:

  1. "If I don't figure this out, I might get fired." It will get you moving.
  2. "If I figure this out, I might help people and make a lot of money." It will produce creativity.
  3. "If we don't figure this out now, our very existence is threatened." Militaries deal with this, and it will fuel the most incredible problem-solving and innovation in a short time.

During World War II, there was a burst of scientific progress that took place. The government was in effect saying that if a discovery had any possible war value, then it had to be developed and put in use, regardless of the expense.

The conditions for big innovations to happen

The biggest innovations seldom happen when everyone's happy or safe. They happen when people are a little panicked and worried, and when they have to act quickly.

In 1932, the stock market fell by 89%. It was an economic disaster where almost a quarter of Americans were out of work. However, the 1930s was also the most productive and technologically progressive decade in history. Economist Alex Field writes that in 1941, the U.S. economy produced almost 40 percent more output than it had in 1929, with little increase in labor hours or private-sector capital input.