Loss restlessness and gain calmness: durable effects of losses and gains on choice switching

While the traditional conceptualization of the effect of losses focuses on bias in the subjective weight of losses compared with respective gains, some accounts suggest more global task-related effects of losses. Based on a recent attentional theory, we predicted a positive after-effect of losses on choice switching in later tasks. In two experimental studies, we found increased choice switching rates in tasks with losses compared to tasks with no losses. Additionally, this heightened shifting behavior was maintained in subsequent tasks that do not include losses, a phenomenon we refer to as "loss restlessness." Conversely, gains were found to have an opposite "calming" effect on choice switching. Surprisingly, the loss restlessness phenomenon was observed following an all-losses payoff regime but not after a task with symmetric mixed gains and losses. This suggests that the unresolved mental account following an all-losses regime increases search behavior. Potential implications to macro level phenomena, such as the leverage effect, are discussed.