The Gaming Brain: Cognitive Biases
In this article on The Gaming Brain, we will move away from the Hardware (Brain regions and Drugs) and get right down into how the Software (your Mind) works with Cognitive Biases to be able to handle all of the impressions it takes in on a daily basis.
On a daily basis, our brain has to take in a lot of information, process it and determine what to do with it. In order to be able to do this, and quickly, the brain uses Cognitive Biases to take quick decisions. These might lead to the decision not being the best at all times, but in general, it has kept humanity alive.
What are Cognitive Biases?
A cognitive bias is a mistake in reasoning, evaluating, remembering, or other cognitive process, often occurring as a result of holding onto one’s preferences and beliefs regardless of contrary information.
However, there is not just “one” Cognitive Bias. There are so far over 175 defined by researchers, and not all of them work in the same way.
We found this amazing graphic, from “Better Humans’” post on Cognitive bias. It breaks down 175 (!!) different cognitive biases and puts them into four quadrants, namely:
- ‘Need to Act Fast‘ (With every piece of new information, we need to do our best to quickly take a decision. Adapt, Improvise, Overcome.)
- ‘Not Enough Meaning‘ (Brain tries to find patterns and connect the dots.)
- ‘Too much Information’ (Brain uses tricks to sort out the information most likely to be useful.)
- ‘What should we remember?‘ (There’s too much information in the universe. We can only afford to keep around the bits that are most likely to prove useful in the future.)
We don’t have time to go over all 175 biases, but we singled out a few that can come in handy to know about if you like gaming.
When it comes to Gaming and Gambling, there are a few biases which stick out and might be useful to learn if you want to avoid getting caught in them.
Fortunately for serious minds, a bias recognized is a bias sterilized.
The peak–end rule is a psychological heuristic in which people judge an experience largely based on how they felt at its peak and at its end, rather than based on the total sum or average of every moment of the experience. The interesting part is that this effect occurs regardless of whether the experience is pleasant or unpleasant.
Ever find yourself looking back at a Casino visit and remembering the big wins, the big losses and how you ended up in the end? That’s your brain and the Peak-End Rule telling you what to remember.
A lot of you will probably have heard about the Gambler’s Fallacy. This is the mistaken belief that if something happens more frequently than normal during a given period, it will happen less frequently in the future.
To sum it up: No, just because there have been five red spins in a row on the Roulette, doesn’t mean that the next number will be black. There’s an 18 out of 37 chance the ball will stop on a black number. No more, no less, unless the wheel or Dealer is rigged.
Hot Hand Fallacy
Ever felt like you were “on a roll” and nothing can stop you? The Hot Hand fallacy is the irrational belief that if you win or lose several chance games in a row, you are either “hot” or “cold,” respectively, meaning that the streak is likely to continue and has to do with something other than pure probability.
The Ostrich Effect comes from Behavioral Finance and it is when investors attempt to avoid negative financial information. Basically, sticking their heads in the sand, like the legend says Ostriches do. (They do not actually put their heads in the sand to avoid danger).
I think a lot of punters and poker players can remember times when they have disregarded information that does not support their bet or move.
Similar to the Ostrich Effect is the Selective Perception bias. In general, this is when people hear what they want to hear in media messages while ignoring opposing viewpoints.
Sportsbetting punters and stock market gamblers tend to often be affected by a combination of both the Ostrich Effect and Selective perception (yes, buying stocks is a gamble.)
Loss Aversion comes from decision theory and cognitive psychology, and refers to people’s tendency to avoid losses rather than acquiring equivalent gains. In other words, it is better not to lose €10 than it is to find €10.
One slot game which really puts this to the test is Magic Monk Rasputin from Merkur Gaming. Before every spin you have to choose whether to risk the Cash pot to win more or collect it.
Survivorship bias or survival bias is the logical error of concentrating on the people or things that made it past some selection process and overlooking those that did not, typically because of their lack of visibility. This can lead to false conclusions in several different ways.
A classic example of tapping into the Survivorship Bias is the old trick where you pick 128 people and send them “this week’s sports betting prediction”. The first week you send to half of the 128 that Team A will win and to the other half that Team B will win. Let’s say that Team B won. The second week you take the 64 people who you told Team B will win, and do the same thing again. After four weeks, you will have a group of eight people who have seen you correctly pick four out of four winners. You now offer them the option to pay money for your next pick.
Money Illusion Bias
The last of our Cognitive Biases to cover, the Money Illusion Bias, is one that expats are more than familiar with, especially when moving from a country where the currency has a much lower value. It means that you value the nominal value higher than the actual value. For example, a Swedish Krona (SEK) is around one-tenth (1/10th) the value of the EUR, but somehow 10 SEK (0.93EUR) feels more than 1 EUR.
The same bias is tapped into by Slot game providers, by setting the game play in Coins, where 1 coin can have different denominations. This serves two effects. First to distance the player from the monetary value, and second to tap into the Money Illusion Bias. It feels better to win 10,000 coins than 100 EUR.
As you have probably learned by now, there is no way to trust your own mind. It is overworked, overstimulated and underwhelmed with the narrative. It just wants to use a few shortcuts to save some time, and you’ll pay the price if you aren’t careful.
Check out our other thoughts on the Gaming Brain and how Gamification taps into it.