Behavioural Economics, Entrepreneurship, Marketing, psychology

The Peak-end Rule

One thing that truly fascinates me is the human brain with its many quirks and twists. I love the way it makes shortcuts and finds loopholes to function optimally and help us make decisions.

This week I immersed myself in one of my favorite cognitive heuristics, namely, ‘The Peak-End Rule’. A rule that was first brought to light by psychologist and economist Daniel Kahneman and researcher Barbara Frederickson.

In a nutshell, the peak-end rule is a mental shortcut in which people judge an experience primarily based on how they felt at its peak (i.e., its most intense point) and its end, rather than based on the total average of every moment of the experience.”

It is a mechanism the brain uses to compensate for its limitations. See, our brains can only process and remember so much, and hence our cognitive processing system creates shortcuts to more efficiently:

  • sort through any incoming information,
  • integrate that information,
  • process it,
  • and then make a decision.

In other words, we compensate because we are limited in the amount of detail our memories will hold! And with that compensation comes the tendency only to recall the peaks and endings of things we experience throughout life.

If you click the link below, you can watch a little animation where we explore the rule in greater detail.  We hope you will enjoy it!

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**And if you enjoy our videos, please consider supporting us on Patreon – Your support would not only mean the world to us but also allow us to continue making awesome FREE content for many years to come.

Click here to learn more: https://www.patreon.com/BigIdeasGrowingMinds

Also, if you have any thoughts, insights, or ideas for books to cover, we’d love to hear from you. Please leave a comment below. And please consider Subscribing to the channel – Your support means the world to us.

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