The Hidden Price of Free

Something offered at a discount and something offered for free occupy different places in our minds.


In a normal purchasing decision—even when the price is steeply discounted—we think about the upside and the downside of the transaction. When something is free, we ignore the downside. 

Offering Something for Free Suppresses Loss Aversion


Free causes us to overvalue something, and to ignore the indirect costs. 

People will spend hours waiting in long lines, put up with the inconvenience of heavy crowds, or purchase a different product they don’t need to get a free gift they never would have purchased anyway.