Psychology of Gaming: Loss Aversion

Game design can be influenced by many different fields. Among them, psychology is one of the most interesting, because it suggests ways that players might act that don’t necessarily go hand in hand with the actual mechanics presented in a game. Thus this week I’m kicking off the start of what I hope will become a series on psychology, with a look at loss aversion and gaming.


I found one of the best discussions of loss aversion at Usabilia, which describes loss aversion thus:

Loss aversion is a human characteristic that describes how people are intrinsically afraid of losses. When compared against each other people dislike losing more than they like winning. Thus losses loom larger than gains even though the value in monetary terms may be identical.

There isn’t much question on the existence of loss aversion. Instead, the modern scientific articles on the topic tend to focus more on why it occurs and what its boundaries on. I think some of those issues could be intriguing for a follow-up article, but for the moment I want to concentrate on the core of loss aversion as it applies to game design.

As it happens, two different designers have made good and repeated use of loss aversion in their designs. Their games thus offer up good examples of how this psychological effect can be used to enhance gameplay. The two designers also happen to be two of my favorites: Reiner Knizia and Stefan Feld.

The Basics of Loss Aversion

RaReiner Knizia’s Ra (1999) is always the game that makes me think of loss aversion most. The main goal of the game is to collect tiles, and those tiles tend to give you points as you build sets of monuments, crown pharaohs, flood land, and advance your civilization. The majority of the points earned are positive, but there are two negatives: if you have the least pharaohs, you lose 2 points, and if you have no civilization advances for an era, you lose 5 points.

Being a very well-designed auction game, the prices for tiles tend to police themselves. However, in most or all games of Ra that I’ve played, civilization tiles tend to be overvalued: people will pay more for them than for something worth +5 points, and that’s clearly because they’re loss averse. I suspect that the civilization die rolls in Ra: The Dice Game (2009) similarly overvalue civilization results, but it’s hard to calculate for sure because Ra values everything in a slightly different way. (That’s probably another project for another day.)

The pharaohs, which can generate -2 points, are even more interesting than the civilization advances. I’m pretty sure that the average player also overvalues staying out of last place in the pharaoh race. However, this aversion tends to fade as players gain experience in the game — a trend that continues through a lot of game designs.

Call that Shannon’s First Law of Loss Design:

I. The more experienced players are, the more willing they are to take losses.

The Age of Scarcity

Notre DameIn the late ’00s, the “scarcity” game appeared on the market. The best known of the category is Agricola (2007), but I think Stefan Feld is the master of the genre.

The basic idea of a scarcity game is that it puts loss front and forward, so that it’s a constant factor in the gameplay. Because  of loss aversion, the tension tends to skyrocket in scarcity games — and it certainly drives decisions in these games, for better or for worst.

Notre Dame (2007) was Feld’s entrant to the category. There’s a lot going on in the game, including card drafting and resource management, but the scarcity elements are always there too: every turn, each player adds a certain number of rats to his plague track, held back only by hospitals that they’ve built.

The interesting thing about Notre Dame is that beginning players often want to hold back their plague track all the time — even though it doesn’t have any effect until it tops out. Experienced players (once more) are a little more open to their plague track increasing, but even they don’t tend to play up the maximumly efficient strategy, which would to almost top out the plague track just as the game ends — because they’re afraid of the mere chance of a loss — which could happen if there’s a bad turn of cards at the end.

II. Players aren’t averse just to loss, but also to the increased chance of loss at some time in the future.

In the Year of the DragonStefan Feld’s In the Year of the Dragon (2007) may be the nastiest, lossiest game ever. Each year, something horrible happens: contagion kills people if there aren’t enough healers; Mongols kill a persont if there aren’t enough warriors; the Emperor takes people if taxes aren’t paid; and the drought kills people if palaces aren’t supplied. It’s a constant litany of misfortune that players struggle to keep up with — and surprisingly it doesn’t exhaust the players’ aversion to loss (though it might exhaust the players!).

Amidst all of that, there’s a Festival. It’s a good thing that can give notable points to the players who supply the ceremony with fireworks — and it’s always the least of players’ worries while the years count down.

III. Even in a game filled with loss, players tend worry about the loss more than the faint glimmers of gain that shine through.

Spending & Consequences

MediciReiner Knizia’s focus on loss aversion seemed to occur in the ’90s, and thus we turn to another game from that era, Medici (1995), for some final interesting interactions with loss aversion.

In Medici players are bidding money to purchase lots of goods — which in turn can give them money, though the amount of return isn’t always clear. The catch is that the money that you’re spending and earning is your Victory Points.

Play suggests that the spending of VPs causes some loss aversion, though probably not as much as losing VPs to some gaming system (like rats or the lack of civilization). However, newer players often seem more reluctant to spend their VPs than more experienced players.

IV. Spending can sometimes cause loss aversion, though not to the level of true loss.

Interestingly, Medici also offers a good reason to be averse to loss. You start off with 30-40 Florins and if you drop to 0 … then you don’t have any more money to bid. So, there’s a real repercussion if you lose too much.

V. Sometimes a game can offer a good reason to be averse to loss.

Conclusion

Clearly, the topic of loss aversion in gaming could use some actual studies to better assess how well it works and what precise type of behavior it generates to what extent for what type of players. I also think it’d be interesting to mathematically dissect how some designers value loss vs. gain. For the moment, however, I think it’s fair to say that designing with loss aversion can work well in a game — providing players with dilemmas that can go beyond the game itself, to core issues of human psychology.

Thanks to Arden S., Nathan E., Patrick L., Eric V. Jonathan D., and Christopher A. who gave me some pointers and thoughts about loss aversion on Facebook.

9 thoughts on “Psychology of Gaming: Loss Aversion

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  2. The plague track example in Notre Dame highlights something important, to compare outcomes you need to consider the chance of it happening and the magnitude of the event. It’s not necassarily optimal for a track to be almost full where the potential drawback is automatic defeat but the benefit for letting it get almost full instead of nearly almost full is relatively minor.

    The Iowa Gambling Task studies show some interesting things in terms of how loss aversion interacts with events of various qualtiies. In this task participants draw cards from decks, each card gives or subtracts points. Participants can change decks at any time and so predictably graviate towards decks that experience shows to have a higher proportion of positive points.

    The interesting part with respect to loss aversion is what happens if decks have equal value but delivered in different ways. For instance one deck could be 90% +1 cards and 10% -9 cards, where another is 90% -1 cards and 10% +9 cards. The predicted loss from drawing from each deck is the same (0) but loss aversion type effects lead to people favouring the deck that is 90% +1 cards because they feel like they “win” on more draws despite the average score being the same.

    That being said I would always be cautious in applying this sort of psycology to gamers because for that particular target audience some effects appear to be reversed. For instance people are terrible at cumulative probability, given the choice between needing to roll 2+ a bunch of times or needing to roll 6+ once people will go for the string of likely rolls even when the cumulative probability favours the single unlikely roll. A lot of games use this and most gamers understand on an intuitive level that over lots of checks cumulative probability will catch up with people. Note that I’ve moved from well evidenced psychological research to an unscientific opportunity sample , but I’ve asked a few wargamers if it’s better to have success hinge upon one unit needing a 5+ or six units all needing a 2+. Most people go for the 5+ option and think that the 2+ option would only be worth it if there were four or so units, where in fact the six units needing 2+ is the better option.

    In short it’s hard to apply general psychology of how people deal with things to experienced players of games because they’ve interacted with these laws before 😉

  3. Three different comments:

    I agree with Greg that the gamers I play with tend to factor in losses so that, for example, avoiding a -5 penalty in Ra is equivalent to a +5 bonus. And 5 points is significant in Ra. Probably the majority of the time that I see someone earn 5+ points from one auction, it’s because there’s a Civilization tile present. And Civ tiles are definitely the only frequent case where a single tile is worth 5 points to multiple players at the same time. Perhaps that’s why players seem to react so strongly to this?

    I think there are a lot of other interesting things to consider about loss vs. progress in games. Feld’s Trajan deserves a mention here. Every quarter of the game, you need to have three tokens of specific types to avoid losing points. You lose 4, 9, or 15 points for missing 1, 2, or 3 of them. Taking a turn to get one of the tiles is definitely worthwhile, as it’s a 6-point swing. But making sure you have the third tile, for a mere 4 points, is not as important. There’s no practical reason why Feld couldn’t have made these worth positive points, but it wouldn’t have felt right. All the other paths to victory in Trajan give only a few points if you dabble in them, but are quite valuable with focus. So players are going to specialize in certain areas and ignore others. If the “disaster” also had a point gain, people would expect the big points to be associated with getting the third tile instead of the first. It’s more thematic to make this part of the game take away points, because then it makes sense that a little effort would lead to big savings but more effort has diminishing returns.

    Finally, I’m not sure I agree about Notre Dame. Just as Medici gives players a penalty beyond just lost points, the Notre Dame plague takes one of your influence tokens off the board. This weakens future actions and scoring in ways that you won’t be able to fully predict at the time the penalty is paid. Therefore, it’s difficult to put a point cost on it. Losing that cube near the end isn’t necessarily bad, since you no longer need to worry about future infrastructure, but I’ve found a mid-game plague penalty to be pretty crippling.

  4. Along the lines of spending VP to advance one’s cause, I have a friend that almost always refuses to trash his Estates in Dominion. There are very few (if any) cases in which getting estates out of your deck early is a bad move, but the concept of “throwing away” VP just isn’t palatable to this player.

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