How much we choose to spend or not spend on an item is one of the most important factors in the marketing mix. There’s a particularly cunning pricing strategy that marketers use to get you to switch your choice from one option to a more expensive one.
The decoy effect is one of the best known human biases violating rational choice theory. According to a large body of literature, we have a tendency to experience a specific change in preference between two options when also presented with a third option that is asymmetrically dominated (or the decoy) that, rationally, should have no influence on the decision-making process ...but it does.
