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Unconscious decision-making

Unconscious decision-making, also known as "system 1" thinking, refers to the type of fast, automatic, and emotional decision-making that happens in the background of our minds without our conscious awareness.

One example of unconscious decision-making that relates to economics is the "framing effect". This is when our choices are influenced by the way information is presented to us, even though the underlying information is exactly the same. For example, imagine that you're deciding whether to take a medication that has a 10% chance of causing serious side effects. Now imagine that instead of being told the chance of side effects, you're told that 90% of people taking the medication experience no side effects. Even though both versions of the information are technically the same, they're presented in different ways, and this can influence your decision.

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