Placebo is the Latin word for "I will please." In Psychology, the "placebo effect" refers to improvement from the expectancy of improvement. Take for example two experimental groups in which one group receives a treatment and the other group receives nothing. Just knowing that they had received a treatment may have resulted in improvement within that group. Their expectations created their reality; hence, THE PLACEBO EFFECT.
Some experiments use placebo drugs to control for the placebo effect. For example, one experimental group may be receiving a real drug while the other group receives a placebo drug, sometimes a sugar pill or even an injected placebo. This way, patients are blind to whether they've received an actual medication or just a placebo, which controls the experiment.
Have you ever had a headache, taken some medicine, and immediately felt like your headache was gone? I'm guilty of it, especially when I was younger; I assumed that taking a pain reliever should immediately relieve my pain! In fact, researchers attribute as much as 80% of the effectiveness of antidepressant drugs is due to placebo effect.
But what causes the placebo effect neurologically? My guess is that it is due in part to heuristics and our assumptions about how things work. Looks like we'll be learning more about it in chapters 12 and 16.
check out this video on the placebo effect: