Endowment Theory, Consumerism and Engagement in Games

If you are forced in a game to give up one of your sheep and in an unrelated action another player gains a sheep, you’re unlikely to be upset at that player. But if they take your sheep instead, it’s more likely to trigger an emotional response.

From a transactional perspective, the two examples above are equivalent. But from an experiential standpoint, I shouldn’t have to work too hard to explain why one will feel different than the other.

This relates to something called endowment theory, sometimes referred to as the endowment effect or divestiture aversion.

It applies primarily to psychology and behavioral economics, but has implications for board games as well.

Loss Aversion and Endowment Theory

The basic principle is that we’re more likely to retain an existing object than we are to acquire the same object when we don’t own it.

Studies that corroborate this are numerous. They all point to the same conclusion: we value something more when we consider it to be something that we personally own.

It also means we’ll be more hesitant to lose that item than we are excited to gain something of equivalent worth.

For clarity, this is on average. Once you are aware of the phenomenon, it loses some (though likely not all) of its potency. And, based on the copious academic evidence on the subject, any exceptions we could cite – which do exist – would prove the rule.

Game designers have known about this for years. Loss aversion is a stronger motivator for gamers on average than other incentives. We’ll generally struggle harder to avoid losing 10 points than to gain 10 points. The psychological aversion to it is stronger.

This can affect the design of games in accounting for typical player behavior.

Designing for Endowment Effect

Author Geoffrey Engelstein cites Catan (pictured at the top of this article) as an example of this. It starts players with 2 of the 10 points they need to win the game. Is this a meaningful way to help them feel ownership over an infrastructure? I’d say this is arguable, but in principle he’s onto something.

There’s also a subset of gamers who hate (or love) when a game allows other players to mess with their plans. This might be in the stealing of resources, it might be encroaching on previously-controlled territory, or several other methods.

This can be a dividing line for preferences, but it also highlights the phenomenon of endowment theory. If resources are from a shared pool, they aren’t really “yours.” But as simple an act as moving a resource from a central board to your personal player space can be enough to confer the feeling of ownership over it.

Whether or not you want to protect this feeling of ownership or threaten it in your design is an important decision, and likely has a lot of downstream implications for the level of interaction in your game.

It’s why taking a card from a central market one turn before another player was planning on taking it can sting, but it doesn’t feel personal. That card didn’t “belong” to the other player yet, despite their plans. This makes it a more benign form of interaction than many others, and some might not refer to it as meaningful interaction at all since it’s often bereft of lasting emotional impact.

The struggle to retain a sense of ownership can be just as interesting, though. What if you’re building a city and another player is acting as a kaiju who is determined to wreck your carefully laid plans? The kaiju player won’t have a strong sense of ownership, but you most likely will, and this dynamic can create a lot of emergent tension and excitement.

Designing for Loss Aversion

If you’ve ever played a game with a lot of “least bad” decisions, you’ve played a game by a designer that understands this.

By least bad, I mean that sometimes you have no truly great decisions, only those that mitigate potential losses to varying degrees. You’re not helping yourself necessarily, merely avoiding the worst penalties you could incur. Again, mechanically, the two could be identical. But psychologically they’re extremely different.

Making it possible to score negative points in your game is one obvious way of doing this. Similarly, some games will only have negative points, so that a score of zero is in fact a perfect score.

Card games tend to feature this more than average. A lot of trick-taking games, for instance, are about loss avoidance as much as or more so than point generation. I’m not sure what that says about the design community or player community that surrounds card games, but it’s worth mentioning.

Endowment and the Magic Circle

Any ownership we feel in games is temporary, a result of stepping into the “magic circle” of the game’s reality. Those pink gems that you fought tooth and nail to retain over the course of the game suddenly become worthless once the game ends and the gems go back into the box with the rest of the game’s components.

And so there’s an implicit understanding that the endowment effect is one we willingly adopt (and discard) because it serves our purposes in the game. If we assume the reality a game presents, we give in to psychological forces that would otherwise not affect us. This enhances the game and, ideally, our enjoyment of it.

So there’s a willing participation in this effect, even if gamers don’t name it in a formal sense. Designers can lean into this silent collaboration with their players to elicit more from games, and gamers can happily sink into a game’s reality to enjoy themselves more fully.