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What Skinner’s Rats and Value Investors have in common
By Dr Wealth  •  April 23, 2014
In the study of psychology there is a phenomenon called Operant Conditioning. Operant conditioning shapes behaviour, and the underlying principle is that behaviour that is positively reinforced tends to be repeated, while behaviour that is not reinforced tends to be extinguished. Think of a child crying for attention. He wants to be picked up and cuddled. When the mother picks up the child, she is actually reinforcing the child. The action (crying) is leads to the desired outcome (being picked up). If a child is picked up every time he cries, he is being constantly reinforced and in no time will associate the desired outcome with the required action. Operant conditioning is studied extensively by psychologist B.F Skinner. He experimented with rats in an apparatus called a Skinner Box. A hungry rat would be placed in a box with a lever by the side. As the rat moved about ......
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By Dr Wealth
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