Regret and Cognitive Dissonance
There is a human tendency to feel the pain of regret at having made errors, even small errors, not putting such errors into a larger perspective. "One "kicks oneself" at having done something foolish." (Shiller, 1997) In trying to avoid the "pain of regret", one may act in ways that would otherwise be viewed as irrational if account is not taken of the pain of regret.
Regret theory may apparently help explain the fact that investors defer selling stocks that have gone down in value and accelerate the selling of stocks that have gone up in value, Shefrin and Statman (1985). The avoidance of selling the former stock may be so as not to finalize the error they have made and thus avoid feeliing the regret. They sell the latter stock so as not to risk failing to do so before the stock later falls, should that occur.
There is also regret over mistaken beliefs where people may distort logic in order to justify their actions thus avoiding regret and/or reject new information that may suggest that their actions were wrong. A classic study by Erlich, Guttman, Schopenback and Mills (1957) showed that new car purchases selectively avoid reading, after the purchase is completed, advertisements for car models that they did not choose, and are attracted to advertisements for the car they did choose.