How Your Brain Treats Cashback as a Reward

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How Your Brain Treats Cashback as a Reward

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Episode 79 of Behavioral Economics with Fexingo drills into why your brain processes cashback differently than a straight discount. Lucas and Luna explore the 'mental accounting' effect that makes you treat a $10 rebate as found money, while the same $10 off at checkout barely registers. They examine a 2024 study from the University of Chicago showing that cashback shoppers spend 18% more per trip than discount shoppers, and discuss how retailers like Target and Amazon have weaponized this cognitive quirk. The episode also touches on the 'decoupling' of reward from purchase, the illusion of earning, and why cashback feels like a win even when you paid full price. By the end, you'll see why your wallet feels heavier after a cashback app notification—and why that's exactly what the store intended. #Cashback #MentalAccounting #BehavioralEconomics #RewardSystem #ConsumerPsychology #RetailStrategy #DiscountVsRebate #SpendingHabits #LossAversion #TransactionUtility #Target #Amazon #UniversityOfChicago #Economics #FexingoBusiness #BusinessPodcast #DecisionMaking #Bias Keep every episode free: buymeacoffee.com/fexingo

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