Why You Care More About Losing What You Have Than Getting What You Don’t

In the forbidding environment in which our brains evolved, loss aversion was a survival tactic. Here’s how to put it to good use.

Why You Care More About Losing What You Have Than Getting What You Don’t
[Photo: Phil Ashley/Getty Images]

Imagine you’re a big shot at the Centers for Disease Control and Prevention (CDC) in Atlanta. Over the past week, you and your team have been tasked with tackling an imminent outbreak of an unusual flu strain.


Everyone agrees something has to be done, otherwise 600 at-risk people will die. Your staff boils down your options to one of two programs you have the resources to put into effect immediately:

  • With Program A, 200 people will be saved for certain.
  • With Program B, there’s a 1 in 3 chance of saving 600 people and a 2 in 3 chance of saving none.

After much deliberation, you choose Program A. You tell your chief of staff to write up a memo with your recommendation to be shared with the CDC’s director.

Within an hour, you’re sitting in the director’s office. You explain that after much thought you’re recommending Program A. Your boss appears puzzled and says she’d have chosen Program B instead. You look carefully at the prepared memo and are a bit confused yourself:

  • With Program A, 400 people will almost certainly die.
  • With Program B, there’s a 1 in 3 chance that nobody will die and a 2 in 3 chance that everyone you’re trying to protect will.

An hour ago, you were pretty sure the first option was better, but now you’re not so convinced. What happened?

All The (Psychological) Difference In The World

The answer is that your chief of staff reframed the outcomes in terms of lives lost rather than lives saved. Mathematically, that shouldn’t make the slightest difference: the likely survival rate under both programs is 33%. But psychologically, it makes all the difference in the world. In fact, the psychologists Amos Tversky and Daniel Kahneman used this very example in their own research and found that a majority of respondents chose Program A when the outcomes were framed as gains, but Program B when the outcomes were framed as losses.

So what does that mean, and why does it matter? First and foremost, it’s an example of how our brains use a number of shortcuts to get by in a complicated world. One of those shortcuts is loss aversion: We typically work harder to avoid losses than we do to pursue gains.


Our aversion to losses probably made a lot of sense in the environment in which our brains grew up. When you’re just barely scraping by, any loss is more likely to be catastrophic than a gain is to be life sparing. For many people in developed countries, life today is a lot more forgiving (that isn’t true, of course, for a wide swath of the world’s population), and so loss aversion can sometimes feel like a puzzling evolutionary leftover.

Using Your Fear Of Losing To Your Favor

A recent study in the Annals of Internal Medicine shows how we can use our natural impulse toward loss aversion in order to improve our behavior. The researchers sought to get overweight folks to walk a bit more. As we know, that can be an uphill battle (even on level ground), leading some employers to go so far as to reward employees for exercising.

In the study, researchers randomized participants into four groups, with the goal of getting people to walk 7,000 steps each day. One group (the control) only got daily feedback about how many steps they’d taken. People in the other three (intervention) groups netted $1.40 for each day they met their walking goal.

But those three groups got their cash in different ways. Participants in the first one were paid $1.40 at the end of each day they hit their walking goal. Those in the next intervention group were enrolled into a lottery each day they met their goal; the lottery on average paid out $1.40 each time it was played. And for participants in the third group, $42.00 hit their bank accounts at the start of each 30-day period, and $1.40 was deducted every day they didn’t hit their goal.

The result? The financial incentives had no effect—except for the group that penalized its members for not hitting their goals. So even though there was no financial difference among all three of the interventions, framing outcomes as losses mattered: The fraction of days that people achieved their walking goals went from 30% to 45%.

This approach works outside of clinical settings, too. My colleagues at Express Scripts used a loss-aversion strategy to get patients to switch from a more expensive brand medication to a cheaper generic one. Until that point, the company’s messaging to patients explained that they could “start saving money” by making the switch. But when they were rewritten to explain how using the pricier money was like “burning money,” the rate of patients switching doubled.


The business lesson is obvious: Before crafting any sort of marketing message, it’s useful to understand how customers’ brains are wired–and that they’ll generally be more motivated not to lose what they already have than to gain something new. But the same principle applies to anyone trying to change their own habits. Sometimes sticks are more effective than carrots—even if the two are the exact same dimensions.

Bob Nease, PhD, is the former chief scientist of Express Scripts, and the author of The Power of Fifty Bits: The New Science of Turning Good Intentions into Positive Results (HarperCollins) as well as over 70 peer-reviewed papers.