Investment Loops is a psychological trick to get people to put an effort on something then offer a random reward that makes them happy. This creates a never-ending cycle of people making efforts for things that might give them a “fake” sense of happiness.

This cognitive bias is used by companies to make their product addicting.

For example, Social media like FaceBook, and Instagram trigger people to take an action, this could be posting the photos they took earlier and then putting them out on their friends’ feed, who will comment, and like, which makes the user feel “good”, so they start carving the attention even more. The brain releases “dopamine”, a chemical in brain that makes you feel good when you receive a reward.

The Cycle continues and their “happiness” is deepened by getting that dose of “notification” or “likes”.