The Psychology of Negative-Sum Competition in Strategic Interactions

Many real-life examples—from interpersonal rivalries to international conflicts—suggest that people actively engage in competitive behavior even when it is negative sum (benefiting the self at a greater cost to others). This often leads to loss spirals where everyone—including the winner—ends up losing. Our research seeks to understand the psychology of such negative-sum competition in a controlled setting. To do so, we introduce an experimental paradigm in which paired participants have the option to repeatedly perform a behavior that causes a relatively small gain for the self and a larger loss to the other. Although they have the freedom not to engage in the behavior, most participants actively do so and incur substantial losses. We propose that an important reason behind the phenomena is shallow thinking—focusing on the immediate benefit to the self while overlooking the downstream consequences of how the behavior will influence their counterparts’ actions. In support of the proposition, we find that participants are less likely to engage in negative-sum behavior, if they are advised to consider the downstream consequences of their actions, or if they are put in a less frenzied decision environment, which facilitates deeper thinking (acting in discrete vs. continuous time).We discuss how our results differ from prior findings and the implications of our research for mitigating negative-sum competition and loss spirals in real life.