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Cognitive Dissonance Definition
Cognitive dissonance refers to the unpleasant emotion resulting from believing two conflicting things simultaneously. Studying cognitive dissonance is a widely followed field in social psychology. Cognitive dissonance can bring about absurd decision making as a person attempts to reconcile their contradicting beliefs.
A Little More on What is Cognitive Dissonance
Conflicting beliefs can be held simultaneously, often without an individual realizing it. This is true when the contradicting beliefs are based on different areas of life OT or can be applied to different situations. When a situation makes the individual realize their conflicting beliefs, then cognitive dissonance occurs and brings about an uneasy feeling. The individual experiencing dissonance would work to settle one of the contradicting beliefs in order for their thoughts to be logical and linear once more.
Example of Cognitive Dissonance
For instance, an investor strongly believes in the “sell in May and go away” market anomaly. The investor is of the opinion that stocks are sold in May, thereby causing prices to have an artificial depression. Thus, you should not for any reason sell stocks in May solely because the selling bids down prices and you cannot for any reason get the most favorable price. Asides this opinion, the investor gets a call from his broker concerning a stock that’s his. Obviously, the company is experiencing a hostile takeover and the price of the stock has begun dropping. The broker thinks this is just the beginning and that the investor should instantly sell the stock. The investor buys the idea until they check the calendar and see it’s the 1st of May. The investor instantly recalls the “no selling in May” guide and begins experiencing anxiety similar to cognitive dissonance. The investor would have to discover a way to reconcile their desire to sell the stock believing that selling stocks in May isn’t favorable so as to be at peace with any decision reached.