Prospect Theory finds that most of us feel hurt from a loss much greater than we feel good about a gain. It’s another asymmetry: losses hurt more than gains feel good. It’s loss aversion. In cognitive psychology and decision theory, loss aversion refers to people’s tendency to prefer avoiding losses to acquiring equivalent gains.

Loss aversion is asymmetric as illustrated in the s-curve.

The value function that passes through the reference point is s-shaped and asymmetrical. Losses hurt more than gains feel good (loss aversion). This differs from expected utility theory, in which a rational agent is indifferent to the reference point. In expected utility theory, the individual does not care how the outcome of losses and gains are framed.

Prospect theory is a behavioral economic theory that describes the way people choose between probabilistic alternatives that involve risk, where the probabilities of outcomes are known. … The paper “Prospect Theory: An Analysis of Decision under Risk” (1979) has been called a “seminal paper in behavioral economics”.

Source: Prospect Theory Wikipedia

Loss aversion is actually asymmetric. The value function that passes through the reference point is s-shaped and asymmetrical. Losses hurt more than gains feel good (loss aversion). This differs from expected utility theory, in which a rational agent is indifferent to the reference point. In expected utility theory, the individual does not care how the outcome of losses and gains are framed. The