For over two centuries, the dominant theory of how people evaluate risky choices held that people weigh gambles by the subjective "utility" of different total wealth levels, an idea proposed by mathematician Daniel Bernoulli in the eighteenth century. It's an elegant theory, but it has a specific, decisive blind spot: it evaluates outcomes purely in terms of final wealth, completely ignoring the reference point a person is starting from — even though where someone starts turns out to matter enormously for how they actually respond to the exact same gamble.
This blind spot isn't a minor technical footnote; it's the reason prospect theory (which explicitly builds in reference points and loss aversion) eventually displaced Bernoulli's model as the better description of how people actually choose, despite the older theory's mathematical elegance and long dominance in economics.