# Loss avoidance during social interactions

## TL;DR

People try to avoid losses in social situations, which affects whether they cooperate or not, but they don't consistently try to minimize losses.

## Contribution

The study distinguishes between loss avoidance and loss aversion in social decision-making using multiple experiments.

## Key findings

- Participants cooperated more when cooperation avoided losses.
- Participants defected more when defection avoided losses, even harming others.
- No consistent evidence was found for loss aversion across experiments.

## Abstract

Social interactions lead to outcomes for oneself and others, which can be gains or losses. Yet, it is unclear how exactly people’s social decisions are affected by whether an outcome is above or below zero. We systematically varied whether the outcomes of social dilemmas (Prisoner’s Dilemma, Stag Hunt, Chicken) were gains, losses, or combinations thereof. Across seven experiments (4 preregistered; NOffline = 197, NOnline = 1653), participants tried to avoid losses altogether (loss avoidance), but there was no consistent evidence that they tried to minimize losses (loss aversion). If cooperation avoided losses, people cooperated more; if defection avoided losses, people defected more, even if this imposed a loss on the other person. Our results suggest that cooperation and social interactions can be influenced systematically if the situation allows people to avoid losses.

This study disentangled loss avoidance from loss aversion, across seven experiments using social dilemmas with gains and losses. We found that people increased or decreased their cooperation to avoid losses. We found no consistent evidence for loss aversion.