Framing and Nudging in Near-miss Events

We experimentally compare increasing “awareness” versus “nudging” to correctly deal with the, so called, Almost Winning bias (Reid 1986). After an Almost Win, AW, individuals should distinguish between situations where near-miss outcomes signal ability, and those where near-miss outcomes are unrelated to the future success chances, as in chance games. The relative effectiveness of the two interventions, aimed at reducing the AW bias, are compared in two different risky choice tasks (“ investment task” and “slot machine task”). Participants, facing a series of near miss-outcomes, showed an increasing willingness to continue playing irrespective of framing but, when informed about the independence of events (nudging) or about the actual winning probabilities (awareness) more correctly interpreted an AW and reacted to it less strongly, albeit nudging seeming less effective in both settings.