Why People Fear Change
If you want to understand — properly understand — the Conservative poster depicting Ed Miliband in the pocket of Alex Salmond, and you are thinking about its likely political impact, then first you need to know about Richard Rosett, the wine-loving economist.
Professor Rosett was a very traditional economic thinker. He was also a very sophisticated wine lover. And these two things were in conflict.
You see, Professor Rosett could spot a good wine and bought some bottles for $10 that were soon able to fetch $200 at auction. Sometimes he would drink these bottles but he would never sell them, even at this high price. Fair enough. Yet here is the oddity. He wouldn’t be willing to buy a bottle at $200 either.
As his fellow economist Richard Thaler pointed out, this is not the sort of behaviour you would expect from a traditional economist. After all, if he thinks the bottle is worth more than $200 he should buy some when they are offered at auction for $200. And if he thinks they are worth $200 or less, he should sell them for $200. Yet he did neither.
The reason for this, Thaler realised, was that even though Professor Rosett was an economist he was subject to the same bias as the rest of us. He attached an extra value to his wine just because they were his already.
The story of Rosett’s wine helped in the creation of the field of behavioural economics. People don’t behave as traditional economics had taught. And one important illustration of this is that people value the status quo, put a store by the things they already have, and are scared of change. The idea of losing something looms much greater than the prospect of gaining. We are, to use the technical term, loss averse.
So most of us are more worried about things we might lose than we are excited about things we might gain. Which doesn’t mean church leaders shouldn’t change things - but it does mean that we have to work much harder than we think to explain why.