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4 Tutorials that teach Gain and Risk: Playing to Win vs. Playing Not to Lose
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Gain and Risk: Playing to Win vs. Playing Not to Lose

Gain and Risk: Playing to Win vs. Playing Not to Lose

Author: Marlene Johnson
Description:

At the end of this tutorial, the learner will understand that in a conflict or decision-making situation, parties may evaluate potential gains and risks of loss in different ways

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Tutorial

Gain & Risk: Playing to Win vs. Playing Not to Lose

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When you have a decision to make, chances are one of the things you do is that you weigh the potential gains that you might make against any risk of loss. I think this is human nature. And it's something that we all do.

Well, I'm Marlene. And in this tutorial with you today, I'd like to take up this whole issue of gains and losses and how we weigh those two when we're making a decision in a conflict situation. Let's start out by defining gains. A potential gain is what an individual values and may obtain as a result of a given decision. So when there's a potential gain that we hope we're going to get-- we may not be certain, but we hope we can get this-- we tend to move towards it.

Now risk of loss can be defined as the chance that a person will not attain his or her goal and/or lose something valued as a result of choosing a particular option in a decision. So if there's a risk of loss, we tend to move away, maybe from meeting a particular need. Because we fear we're going to lose something valued. We're not certain we will. But we fear that.

So let's just look at how we juggle gains and losses and weigh them in decision-making that we make on an everyday level. One of the things I think we often consider gaining-- that we want to gain-- is time or money. We don't want to lose time or money.

So we're going to go shopping at the grocery store. What do we do? We might cut out some coupons, take them with us so that we can gain as much as we can for the least amount of money.

How do we decide where we're going to eat? We're going to go out to a movie and dinner with a friend. And we want to choose a restaurant. Well, time is important. Do we want to spend time together with the friend?

So let's choose a restaurant that's close to the theater. So we have more time to talk over dinner before we go to the movie. Now these are just very simple things that we're juggling. Because we want to gain time. And we want to make the most of our money.

Now there's been some interesting research done that shows that when people are weighing gains and losses, they tend to evaluate avoiding loss as more important than maximizing gain. Isn't that interesting? Avoiding loss is more important than maximizing gain. And I think this is true, particularly in larger decisions, where we may not want to risk it all. We're going to play it safe-- maybe in financial investments.

So how does all of this play into conflict-- when two parties are in conflict and they know they have some decisions to make? Well, all conflict-resolution strategies are really built around the idea that you can maximize gains and risk loss when you enter a situation where you are sitting down to resolve a conflict. And instilling that confidence in the parties is important. It's one of the things the mediator or the conflict-resolver will work to do. We'll sit with the parties and show them that what they have to gain here in this process-- in any of the conflict-resolution processes-- is there's more possibility of gaining by going through the process than by losing.

So conflict-resolution processes are built around building that trust that you can maximize your gains and minimize your losses. So I've enjoyed being part of this tutorial with you. And I look forward to next time.

Terms to Know
  • Potential Gain

    What an individual values and may obtain as a result of a given decision.

  • Risk of Loss

    The chance that a person will not attain his/her goal and/or lose something valued as a result of choosing a particular option in a decision.