The Loss of Loss Aversion: Will It Loom Larger Than Its Gain?

Loss aversion, the principle that losses loom larger than gains, is among the most widely accepted ideas in the social sciences. The first part of this article introduces and discusses the construct of loss aversion. The second part of this article reviews evidence in support of loss aversion. The upshot of this review is that current evidence does not support that losses, on balance, tend to be any more impactful than gains. The third part of this article aims to address the question of why acceptance of loss aversion as a general principle remains pervasive and persistent among social scientists, including consumer psychologists, despite evidence to the contrary. This analysis aims to connect the persistence of a belief in loss aversion to more general ideas about belief acceptance and persistence in science. The final part of the article discusses how a more contextualized perspective of the relative impact of losses versus gains can open new areas of inquiry that are squarely in the domain of consumer psychology.     

Humans (Homo sapiens) fail to show an inequity effect in an “up-linkage” analog of the monkey inequity test

Brosnan and de Waal (Nature 425:297–299, 2003) claimed that if a capuchin sees another capuchin receiving a superior food, she tends to reject an inferior, previously acceptable food. They related this phenomenon to human inequity aversion. This phyletic extension is “down linkage,” because nonhuman research is interpreted in terms of human research. The present experiment makes an “up-linkage” test of this claimed connection by attempting to reproduce the capuchin-inequity effect in humans. In Experiment 1’s equity condition, a subject and an adjacent confederate each clicked a computer mouse to mark the number “7” from a random numbers table, earning 0.5 yen per mark. In the inequity condition, the confederate’s pay rate was twice that of the subject. There was no between-condition difference in quitting times or likelihoods. Experiment 2 replicated Experiment 1 except, before beginning, the subject and confederate clicked a mouse over a rapidly switching message that said they would earn either 0.5 or 1 yen per marked seven. For the equity condition in this rigged test, subject and confederate stopped the message at 0.5 yen, while in the inequity condition, these values were 0.5 and 1 yen, respectively. Now, inequity-condition subjects quit sooner than equity-condition subjects. Experiment 1 found no inequity effect, but Experiment 2 did. These results show that: (a) a sense of control/responsibility may be critical to an inequity effect and (b) the inequity effect putatively present in capuchins cannot be reproduced in an up-linkage human analog of that research, thereby calling this linkage into question. This report exemplifies that up- and down-linkage tests are often requisite to establish commonality of psychological process between nonhuman primates and humans.     

Reference-dependent expected utility with incomplete preferences

An important reason why people deviate from expected utility is reference-dependence of preferences, implying loss aversion. Bleichrodt [Bleichrodt H. (2007). Reference-dependent utility with shifting reference points and incomplete preferences. Journal of Mathematical Psychology, 51, 266-276] argued that in the empirically realistic case where the reference point is always an element of the decision maker’s opportunity set, reference-dependent preferences have to be taken as incomplete. This incompleteness is a consequence of reference-dependence and is different in nature from the type of incompleteness usually considered in the literature. It cannot be handled by existing characterizations of reference-dependence, which all assume complete preferences. This paper presents new preference foundations that extend reference-dependent expected utility to cover this case of incompleteness caused by reference-dependence. The paper uses intuitive axioms that are easy to test. Two special cases of reference-dependent expected utility are also characterized: one model in which utility is decomposed into a normative and a psychological component and one model in which loss aversion is constant. The latter model has been frequently used in empirical research on reference-dependence.     

Enhancement of food aversion by exposure to a poisoned conspecific in Norway rats (Rattus norvegicus)

Two experiments were conducted to determine whether exposure to a poisoned conspecific enhances prior food aversion in rats. In Experiment 1, subjects were serially exposed to two foods, cocoa‐flavored and cinnamon‐flavored ones, and were then poisoned 1 h later. On the next day, they were exposed to a poisoned conspecific that had eaten a cocoa‐flavored food. On the subsequent choice test, subjects had an enhanced aversion to cocoa‐flavored food. The result was replicated in Experiment 2, in which a cinnamon‐flavored food was assigned as a target. The results are discussed in relation to previous findings.     

Take it or leave it for something better? Responses to fair offers in ultimatum bargaining

We investigated if responders accept a 50–50 split in a modified version of the ultimatum game, in which rejection yields a higher payoff (€7) than accepting the equal offer (€5). Therefore, the decision to accept the 50–50 split in this modified ultimatum game cannot be perceived as a self-interest act, as opposed to the standard game, in which acceptance may reflect resignation in the knowledge that the equal split is the best one can expect. A substantial proportion of responders accepts the equal split in this modified game (Study 1), which clearly establishes egalitarian preferences. Further studies show that the willingness to accept is not an artifact of indifference towards the extra payoff (Study 2), but reflects true concerns for proposers’ outcomes (Study 3).     

Power Politics and the Balance of Risk: Hypotheses on Great Power Intervention in the Periphery

Great powers frequently initiate risky diplomatic and military interventions in the periphery—regions that do not directly threaten the security of a great power's homeland. Such risky interventions are driven by leaders' aversion to losses in their state's relative power, international status, or prestige. These leaders often persist in such courses of action even when they incur mounting political, economic, and military costs. More surprisingly, they undertake risky strategies toward other great powers in an effort to continue these failing interventions. Hypotheses concerning such interventions are derived from the prospect theory and defensive realist literatures.     

A Story of Losses and the Creation of an Alternate World

The author presents a clinical case to illustrate the consequences of a history of loss, beginning with the early death of the mother. The creation of a complex defensive system based on internal division and manifested through the existence of an alternate world is analyzed. The author stresses the importance for the patient of re-experiencing the sense of emptiness within an analytical setting and learning to tolerate it thanks to dependence on the auxiliary self of the analyst. D. W. Winnicott?s suggestion of a relationship between the experience of emptiness and the fear of breakdown are also discussed.     

Acquisition of a conditioned taste aversion becomes context dependent when it is learned after extinction

A conditioned taste aversion experiment tested context-switch effects on retrieval of conditioned stimulus (CS)–unconditioned stimulus (US) acquisition performance in rats. A context switch impaired performance when the target flavour was trained in a context where a different flavour underwent extinction. Conditioned taste aversion in the absence of previous extinction of the alternate flavour was not context dependent. It is suggested that the ambiguity in the meaning of the extinguished cue leads animals to pay attention to the context, so that the information learned in that context becomes context dependent.     

算法拒绝的三维动机理论

算法拒绝意指尽管算法通常能比人类做出更准确的决策, 但人们依然更偏好人类决策的现象。算法拒绝的三维动机理论归纳了算法主体怀疑、道德地位缺失和人类特性湮没这三个主要原因, 分别对应信任、责任和掌控三种心理动机, 并对应改变算法拒绝的三种可行方案: 提高人类对算法的信任度, 强化算法的主体责任, 探索个性化算法设计以突显人对算法决策的控制力。未来研究可进一步以更社会性的视角探究算法拒绝的发生边界和其他可能动机。     

损失规避的产生根源

损失规避是指由损失引发的负效用大于由等量收益引发的正效用的现象, 其产生根源能够从神经经济学和进化心理学两个方向进行解释。损失规避的脑机制分为两个系统：主观价值评价系统主要包括纹状体和前额皮层, 与主观价值的评估有关; 情绪唤醒系统主要包括杏仁核和脑岛, 与厌恶等消极情绪有关。在进化心理学的视角下, 通过回顾有关动物决策行为的研究来探索损失规避行为的进化历史, 并结合相关进化理论总结该行为产生的进化原因。未来可探索与行为损失规避相关的神经递质, 进一步研究损失规避的产生根源。