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Misinterpreting ‘winning’ in multiline slot machine games a

a

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Candice Jensen , Mike J. Dixon , Kevin A. Harrigan , Emily b

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Sheepy , Jonathan A. Fugelsang & Michelle Jarick a

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Department of Psychology, University of Waterloo, Canada

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Gambling Research Lab, University of Waterloo, Canada Published online: 17 Sep 2012.

To cite this article: Candice Jensen , Mike J. Dixon , Kevin A. Harrigan , Emily Sheepy , Jonathan A. Fugelsang & Michelle Jarick (2013) Misinterpreting ‘winning’ in multiline slot machine games, International Gambling Studies, 13:1, 112-126, DOI: 10.1080/14459795.2012.717635 To link to this article: http://dx.doi.org/10.1080/14459795.2012.717635

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International Gambling Studies, 2013 Vol. 13, No. 1, 112–126, http://dx.doi.org/10.1080/14459795.2012.717635

Misinterpreting ‘winning’ in multiline slot machine games Candice Jensena, Mike J. Dixona*, Kevin A. Harriganb, Emily Sheepyb, Jonathan A. Fugelsanga and Michelle Jaricka a

Department of Psychology, University of Waterloo, Canada; bGambling Research Lab, University of Waterloo, Canada

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(Received 8 November 2011; final version received 30 July 2012) On multiline slot machines, ‘wins’ often amount to less than the spin wager, resulting in a monetary loss to the gambler. Nevertheless, these losses disguised as wins (LDWs) are accompanied by potentially reinforcing audiovisual feedback. A concern for gambling behaviour is whether or not players categorize LDWs as wins or losses, as miscategorization could effectively increase the reinforcement rate of these games. The purpose of this study was to evaluate whether novice gamblers psychologically miscategorize LDWs. Forty-seven novices (undergraduate students) played 200 spins on an actual slot machine with credits, then estimated how often they won. It was found that the more LDWs players were exposed to, the higher their win estimates. In a subsequent ‘think out loud’ playing session, the majority of novices also verbally miscategorized LDWs as wins. We conclude that LDWs could increase the reinforcement rate of these games, despite not increasing the payout to the gambler. Keywords: gambling; electronic gaming machines; cognition; characteristics; irrational beliefs

Introduction Slot machines and other electronic gaming machines (EGMs) have long been associated with problem gambling (PG). Such relationships have been reported in Australia, Canada, New Zealand and the United States, amongst other nations throughout the world. While there is currently some contention as to whether EGMs have higher absolute ‘addictive potential’ compared to other gambling forms (see Dowling, Smith, & Thomas, 2005, for a review), it remains a consensus that many players experience gambling problems related to EGMs. As a result, Dowling et al. (2005) remark: Irrespective of whether EGMs have an absolute higher ‘addictive’ potential relative to other gambling forms, there is no doubt that many individuals experience problem gambling related to EGMs and its sequelae. It is therefore appropriate for research to attempt to identify EGM characteristics that may affect the development and maintenance of problem gambling behaviour.

EGMs are a general category of gaming machines, which include a variety of games. For a more thorough description of EGMs, the authors guide the reader to the following resources: Dowling et al., 2005; Turner and Horbay, 2004; Zangeneh, Blaszczynski, and Turner, 2007. There are two general subcategories of EGMs (Dowling et al., 2005): low-intensity EGMs (which we will refer to as LEGMs) and high-intensity EGMs

*Corresponding author. Email: [email protected] q 2013 Taylor & Francis

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(which we will refer to as HEGMs). LEGMs (e.g. fruit machines) are characterized by relatively slow playing speeds, minimal per game expenditures and low cash or nonmonetary prizes. By contrast, fast playing speeds, higher allowable per-game betting and larger possible prizes characterize HEGMs – characteristics that have previously been associated with problem gambling. Popular HEGMs include slot machines (or ‘pokies’), video poker and video lottery terminals (VLTs). VLTs are multigame machines which include games such as video slots, video poker and video Keno, amongst other games. The remainder of this paper will focus on modern multiline video slot machine games – games that are popular in North American casinos and racetracks, Australian clubs and hotels, and New Zealand Casinos. Many VLTs, however, also allow players to play multiline games. VLTs are available in most Canadian Provinces (excluding Ontario and British Columbia) and in a few US states. Multiline video slot machine games usually have five reels, high-fidelity computer graphics and sounds and, most importantly, allow the gambler to wager on multiple lines per spin. On multiline games, if the gambler gets a ‘winning’ combination of symbols on one or more of the paylines, the machine highlights the win with winning sights and sounds. For instance, coloured lines join the symbols in the winning combination, symbols within the winning combination may be animated, and the gambler’s winnings are counted up, both visually in a win (or paid) counter and aurally by a salient ‘rolling’ sound (e.g. sounds reminiscent of the tinkling of coins falling onto one another). When it is a loss, however, the machine goes into an abrupt state of quiet in both the auditory and visual domains. Interestingly, when a player wagers on multiple lines, many ‘wins’ often amount to less than the total spin wager, resulting in a monetary loss to the gambler. Nevertheless, these monetary losses are still accompanied by potentially reinforcing audiovisual feedback. For instance, a gambler who bets 5 cents on each of 15 lines (for a total spin wager of a $.75) but only ‘wins’ back 25 cents would still see their ‘winnings’ being counted up, and would still see flashing lines outlining their ‘winning’ combinations, despite the fact that they lost 50 cents on the spin. Dixon, Harrigan, Sandhu, Collins, and Fugelsang (2010) referred to these potentially reinforcing losses as losses disguised as wins or LDWs. These outcomes have also previously been referred to as ‘fake wins’ by Wilkes, Gonsalvez, and Blaszczynski (2010). While LDWs share more features in common with actual wins than regular losses, they are remarkably (perceptually) similar to actual wins. For instance, flashing lines, winning sounds and credits being counted up are all features common to actual wins and LDWs – the only thing that distinguishes between these two types of outcomes is that for actual wins the players gain money, while for LDWs the players lose money. By contrast, the two types of losses (LDWs and regular losses) have many distinguishing features – flashing lines, sounds, and credits being counted up always accompany LDWs, but never accompany regular losses. In fact, monetary loss is the sole feature shared by LDWs and regular losses. A potential concern for gambling behaviour is that if players consider LDWs as wins, then LDWs may be reinforcing to players. Research suggests that the desire to win money may be a primary motivator regulating gambling behaviour (Ladouceur, Sylvain, Boutin, & Doucet, 2002; Neighbors, Lostutter, Cronce, & Larimer, 2002; Parke, Griffiths, & Irwing, 2004; Wood, Gupta, Derevensky, & Griffiths, 2004). However, current theories posit that an observed EGM-PG relationship arises from complex interactions between ‘player’ and ‘machine’ characteristics (e.g. Blaszczynski, Sharpe, & Walker, 2003; Nower & Blaszczynski, 2010). Specifically, research suggests that erroneous gambling-related cognitions, in addition to misunderstanding one’s probability of winning, may lead to overestimations of one’s likelihood of winning. Such

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overestimations have been subsequently linked to overspending while playing HEGMs. The latter illustrates an important point regarding slot machine gambling – namely, it is not only the inherent characteristics of these games that may drive gambling behaviour, but rather that gambling behaviour also depends largely on one’s motivation to gamble, in addition to one’s interpretations of slot machine characteristics. As discussed, if players consider LDWs wins, then the concern for gambling behaviour is that LDWs could substantially increase the reinforcement rate of slot machines games. For instance, Harrigan and Dixon (2009) showed through computer simulations of Lobstermania that LDWs are more frequent than actual wins when the player bets on six or more lines. If the exciting flashing lights and ‘winning’ sounds are thought of as reinforcing, then a gambler playing 15 lines on Lobstermania would (on average) receive reinforcement following a spin on 32% of spins (14% following actual wins plus 18% following LDWs). By contrast, a gambler betting on only one line would only be expected to receive reinforcement on 5% of spins (note that these are all actual wins – LDWs only occur when playing multiple lines). Thus, playing multiple lines may substantially increase the reinforcement rate of the game, whilst keeping the amount paid out to the gambler constant. In a more recent investigation, Harrigan, Dixon, MacLaren, Collins, and Fugelsang (2012) analysed a multiline slot machine called Money Storm that enables players to wager on up to 20 lines. After playing 5000 spins on a one-line game and 5000 spins on a 20-line game, they found that the payback percentages of both games were identical (90.5%). Thus (consistent with their analysis of the PAR sheets for this game), playing multiple lines does not increase how much money the gambler wins (or loses). The reinforcement rate (i.e. number of wins and LDWs) on the 20-line game, however, far exceeded the reinforcement rate on the single-line game (i.e., number of wins only). While they found that the percentage of actual wins was slightly greater in the 20-line (18.2% of spins) compared to the one-line game (15.4% of spins), what is remarkable is the number of LDWs that occurred in the 20-line game. Specifically, LDWs occurred on 29.7% of spins in the 20-line game, which, combined with the number of actual wins, leads to a combined reinforcement rate of 47.8% (compared to only 15.4% in the one-line game). Thus, playing the maximum number of playable lines on Money Storm effectively increases the reinforcement rate of the game, without increasing the amount paid to the gambler. These results are disconcerting, given that Dixon, Maclin, and Daugherty (2006) previously found that the vast majority of participants preferred playing games with smaller but more frequent payouts than games with larger but less frequent payouts. One line of evidence suggesting that gamblers may find LDWs reinforcing are studies reporting that the majority of mulitline payers do in fact play multiple lines. For instance, Livingstone, Woolley, Zazryn, Bakacs, and Shami (2008) report that gamblers often use a maxi-min strategy – that is, they play the maximum number of lines at the minimum possible bet per line. Moreover, in a recent study conducted in our lab (71 participants, in preparation), we found that gamblers playing 15-line slot machines games, who were allowed to freely choose the number of lines played per spin, played on average 13 lines. More importantly, we found that gamblers played one single line (where no LDWs were present) on fewer than 5% of spins. As a second line of evidence, Dixon et al. (2010) explored whether novice gamblers would somatically respond to LDWs as if they were actual wins. Previous research has shown that physiological arousal can inform human decision making, even prior to conscious awareness. For instance, in the renowned Iowa Gambling Task (IGT; e.g. Bechara, Damasio, Damasio, & Anderson, 1994), individuals must learn to differentiate between good (low-risk) decks with steady and small payouts, and bad

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(high-risk) decks with large wins but even larger punishments. The interesting finding from studies of the IGT is that individuals begin to show large anticipatory skin conductance responses (SCRs) prior to choosing cards from the bad decks, and also begin to exhibit a bias towards choosing cards from the safer decks much sooner than they are consciously able to differentiate between good and bad decks. Bechara et al. (1994) referred to these early anticipatory SCR responses as somatic markers, which are believed to be used to physiologically inform decision making (somatic marker hypothesis; Bechara, Damasio, Tranel, & Damasio, 1997). Dixon et al. (2010) explored whether novices would show equivalent somatic markers to wins and LDWs. They recorded participants’ skin conductance responses (SCRs) following wins, LDWs and regular losses while playing the 15-line video slot machine Lobstermania. They found that even though players lost money on LDWs, they showed significantly greater SCRs for LDWs compared to regular losses. Wilkes et al. (2010) have reported a similar finding. Moreover, players also showed similar somatic markers to wins and LDWs (i.e. participants’ arousal responses following both actual wins and LDWs were statistically indistinguishable), suggesting that participants may be ‘somatically miscategorizing’ LDWs as wins. Brown (1986) argues that gambling-related increases in physiological arousal may be the primary reinforcer regulating gambling behaviour. Diskin and Hodgins (2003) report that both pathological and non-pathological gamblers show increased physiological arousal while gambling and also while thinking about personally relevant losses and wins. As a result, the latter results suggest that LDWs in multiline games may make these games more enjoyable in two ways: (1) LDWs may induce elevations in (reinforcing) arousal; and (2) LDWs may lead gamblers to feel as if they are winning more often than they really are via ‘somatic miscategorization’. While Dixon et al. (2010) previously showed that novices may somatically miscategorize LDWs as wins rather than correctly categorizing these outcomes as losses, research has yet to show whether gamblers would psychologically miscategorize (i.e. verbally label) these outcomes as wins as well. Theories of (psychological) categorization posit that people will categorize an entity as belonging to one category as opposed to another based on similarity. That is, entities or experiences that share many features tend to be placed into one category, whereas entities that share few features and have many distinctive features tend to be placed in different categories (e.g. Estes, 1994; Rosch, Mervis, Gray, Johnson, & Boyes-Braem, 1976). Given that LDWs share many features with actual wins and share few features with regular losses, the central question of the present paper is whether players would verbally miscategorize LDWs as wins (despite the cost to the gambler) rather than correctly categorizing these outcomes as losses. If gamblers miscategorize LDWs as wins, then LDWs may contribute to the popularity of multiline games, especially since LDWs in multiline games can be even more frequent than actual wins. The current study explored whether novice gamblers would psychologically miscategorize LDWs as wins rather than correctly categorizing these outcomes as losses due to the marked similarity between actual wins and LDWs and the marked dissimilarity between LDWs and regular losses. As a first assay, we chose a sample of novice players for two reasons. First, we wanted to extend the findings of Dixon et al. (2010) who previously showed that novices somatically miscategorized LDWs as wins. Second, problem gambling is a complicated condition, and motivations for gambling do not necessarily stay constant over time. As an example, one problem gambler reports (personal correspondence) that they eventually became aware of LDWs during their 10-year history of gambling, but that they were too ‘far gone’ in the development of their

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gambling behaviour for that knowledge to make a difference. Delfabbro & Winefeld (2000) suggest that cognitive factors may play an important role in the development of gambling (i.e. naive gamblers), but may play a lesser role as gambling behaviours become automatized or habitual. Thus, as a first assay, we sought to determine how a sample of healthy, non-behaviourally conditioned novice players would categorize LDWs. Undergraduate students can serve as a particularly useful population to study our question, given that many are close to the age of majority. As a result, some novices may be novices simply because they have not yet had the opportunity to play slot machines. The manner in which novices categorize LDWs is important when one considers that all PGs at one time were novices. Thus it is important to consider the type of games that novices initially prefer (multiline vs single line). To explore whether novice players miscategorize LDWs as wins, two groups of participants played Lobstermania: one group bet on three lines and the other group bet on six lines. Based on the programming documents (PAR sheets) for games which we have obtained through the Freedom of Information Act, we have calculated the expected number of times that players (on average) will encounter wins, LDWs and losses while playing Lobsermania. Participants playing six lines or three lines should (on average) experience similar numbers of actual wins (8.1% and 8.7%, respectively) during a playing session, while participants playing the six-line game should experience considerably more LDWs (10.7%) than participants playing the three-line game (3.8%). As such, we predict that if players psychologically miscategorize LDWs as wins, then they should recall winning more often in games with more LDWs (i.e. the six-line game) as compared to games containing relatively fewer LDWs (i.e. the three-line game), despite the similar numbers of actual wins and similar payback percentages. We also predicted that when asked to verbally categorize LDWs as wins or losses, the majority of participants should verbally miscategorize LDWs as wins rather than correctly categorizing these outcomes as losses. Finally, given the finding of Dixon et al. (2010) that LDWs are more arousing than regular losses, we hypothesized that participants may report that games with more LDWs are more subjectively arousing, exciting and enjoyable than games with fewer LDWs. Method Participants A total of 47 undergraduate students (27 females) from the University of Waterloo participated in this study for financial remuneration. Students were recruited using the University of Waterloo’s Research Experience Group’s online recruitment system. Ages ranged between 19 and 25 years, with a mean age of 19.9 years. Participants self-declared that they had never played a slot machine before and were not in treatment for problem gambling. All methods and procedures were approved by the University of Waterloo’s Office of Research Ethics. Apparatus Participants played a 50 cent (CAD) version of Lobstermania. The game has five video reels, with three symbols visible on any reel at any given time. Players can play up to 15 lines per spin, at up to 5 credits per line, for a possible maximum (max) bet wager of 75 credits per spin. Players normally acquire credits in the game by getting three or more identical symbols in a row from left to right on one (or more) paylines.

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Design Participants were randomly assigned to play either a three-line (fewer expected LDWs) or a six-line (relatively more expected LDWs) Lobstermania game. To ensure identical spin wagers, participants playing three lines were instructed to bet two credits per line (for a total spin wager of six credits), while participants playing six lines were instructed to bet one credit per line (for a total spin wager of six credits). Figure 1 shows schematics of the three-line (left panel) and six-line (right panel) Lobstermania games.

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Procedure Upon arrival, participants read an information letter and signed a consent form. Participants were tested individually in a laboratory with four actual slot machines present. Participants were seated on a stool in front of the Lobstermania slot machine and given detailed instructions. The experimenter explained that the slot machine had five reels and that the participant could spin by pressing the spin button on the slot machine cabinet. At the beginning of the instructions, only one line was highlighted on the machine. Participants were shown the various pay tables and help menus available on the machine and informed that they could acquire credits in the game by getting three or more symbols in a row from left to right on any of the paylines. The experimenter subsequently explained all of the various counters on the slot machine (Figure 1), starting with the left-most ‘credit’ counter and ending with the right-most ‘win’ counter. The experimenter explained that the ‘credit’ counter displayed their starting balance (and constantly updated the running total) in slot machine credits. The starting balance on the machine was preset to 1600 credits. Participants were given four $50 bills to insert into the machine to mimic the act of wagering at an actual casino. This $200 contributed an additional 400 credits, bringing the starting balance to 2000 credits. Participants were instructed to increase the number of lines on the machine to three or six lines (depending on randomized group assignment) and to bet either two credits (three-line condition) or one credit (six-line condition), for a total wager of six credits per spin. The experimenter pointed to the win counter and explained that this counter would show how many credits they acquired on a spin, if any. Participants were informed that they would receive $10 for their time (60 min)

Figure 1. In multiline games players can bet on multiple lines. The schematic depictions above show the positions of the counters, and playable lines on a typical modern video multiline game. The left panel shows the three playable lines when players select a 3-line game, the right panel shows the 6 playable lines when players select a 6-line game. Typically three identical symbols (from left to right) on any given line leads to a credit gain. (Note the symbols above are of our own design).

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and could receive up to an additional $20 based on their ending balance during the gambling session. (Participants were informed in the information letter that the amount that they would receive would be calculated by taking the cubed root of their ending balance on the slot machine). Participants were asked to play 200 spins on the machine by pressing the spin button on the game cabinet. Participants were instructed that they could spin as quickly or as slowly as they would like but were requested to wait for any sound to end before spinning again. Participants were informed that they would be asked some questions following the playing session. During the playing session, the experimenter manually recorded each spin outcome (e.g. actual win, LDW or regular loss) and the amount of credits acquired (if any). Following the 200 spins, participants were verbally asked to provide ratings or estimates for the following items: (1) Please rate your level of enjoyment while playing the slot machine – that is, give me a number between 1 and 10, where 1 is not enjoyable and 10 is extremely enjoyable; (2) Please rate your level of excitement while playing the slot machine – that is, give me a number between 1 and 10, where 1 is not exciting and 10 is extremely exciting; (3) Please rate your level of arousal while playing the slot machine. You can think of arousal like riding a roller coaster, where your heart rate may increase or your hands may become clammy. Thinking about arousal in this way, please rate your level of arousal on a scale from 1 to 10, where 1 is not arousing and 10 is extremely arousing; and (4) In this part of the session you had 200 spins. Of these 200 spins please estimate the number of times on which you won – that is, give me a number between 1 and 200. Following the main playing session and questions, participants played an additional 50 spins on the machine. Both the three-line and six-line groups were instructed to play six lines. They were asked to spin the reels on the slot machine and, for each spin, to tell the experimenter what they were thinking as they were spinning (‘think out loud protocol’; e.g. Benhsain, Taillefer, & Ladouceur, 2004; Delfabbro & Winefeld, 2000). Once the outcome was delivered, they were asked to categorize the spin as a win or a loss. Participants were told to pause after each spin until the experimenter asked them to spin again. For each of the 50 spins, we recorded participants’ free reports, spin categorization (i.e. as win or loss), actual spin outcome (e.g. actual win, LDW or regular loss) and the amount of credits acquired, if any. At the end of the session, participants were asked to answer some additional questions. These questions served as pilot research for future studies, and as such are not discussed in the present paper. At the end of the experiment, participants were asked if they had any questions and were given a feedback form and two responsible gambling brochures. Results Estimated number of wins during the 200-spin playing session Table 1 shows the mean number of observed LDWs, number of observed wins and observed ending balance (in credits) for the participants in the three-line and six-line groups. The three-line and six-line groups’ observed ending balances, wins and LDWs were compared using independent samples t-tests. As expected, participants who played the six-line game (many LDWs) experienced significantly more LDWs during the playing session than participants who played the three-line (relatively fewer LDWs) game, t(45) ¼ 10.61, p , .001. Contrary to our expectations, participants who played the six-line game also experienced more actual wins during the playing session than participants who played the three-line game, t(45) ¼ 2.20, p ¼ .03. Given this significant difference, numbers of actual wins were statistically controlled for in all subsequent win-estimate

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Table 1. Mean observed slot machine outcomes during the 200-spin playing session. Standard deviations are shown in brackets.

# LDWs (/200 spins) # Wins (/200 spins) End Balance (credits)

3-lines

6-lines

7.0 (2.5) 16.4 (4.0) 2040.9 (561.7)

19.1 (4.9)*** 19.0 (3.8)* 2117.6 (721.9)

analyses. Finally, as expected, the two groups did not differ in their ending balances, t(45) ¼ .17, p ¼ .87, since the number of lines played has no effect on the payback percentage1 (Harrigan & Dixon, 2009). We analysed whether participants playing the relatively many LDWs (six-line) game estimated that they won on significantly more spins than participants who played the relatively fewer LDWs (three-line) game by submitting participants’ win estimates (i.e. total numbers of wins) to a single hierarchical multiple linear regression model, entering each participants’ observed number of actual wins into the model first (as a ‘nuisance’ variable), followed by the game that the participant played (i.e. three lines or six lines). Prior to the analysis, we eliminated any multivariate outliers using Cook’s Distance – an assessment of data points with undue influence – that can bias regression coefficients to reflect extreme scores rather than underlying sample relationships. Three data points were eliminated using this procedure. (The data points that were removed had Cook’s distance values of .11, .22 and .12, all greater than the .09 cut-off for this data set. The remaining points had a mean Cook’s distance value of .01 with a SD ¼ .01). Actual numbers of wins accounted for .05% of win estimate variance. Importantly, the game played variable (i.e. fewer LDWs versus more LDWs games) significantly increased the amount of win estimate variance that was accounted for over and above the observed number of wins, R2change ¼ .184, Fchange (1, 41) ¼ 9.32, p ¼ .004. Participants in the six-line group estimated that they won on significantly more spins (M ¼ 26.8) than participants in the three-line group (M ¼ 14.8). These means for both groups can be seen in Figure 2. The final regression model with both parameters was significant, F(2,40) ¼ 5.85, p ¼ .006. Model parameters and statistics are reported in Table 2. 35 Estimated # of Wins

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*p , .05, ** p , .01, *** p , .001

30 25 20 15 10 5 0 Fewer LDW Game Many LDW Game (3-lines) (6-lines) Game Played

Figure 2. Participants’ win estimates after playing either 200 spins on a fewer LDW (3-line) game (N ¼ 20) or a many LDW (6-line) game (N ¼ 24). Error bars represent 95% Confidence Intervals for Between Subjects Designs (Masson & Loftus, 2003).

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Table 2. Regression coefficients and statistics from the model predicting participants’ win estimates from observed numbers of actual wins and game played (3-lines with few LDWs or 6- lines with many LDWs).

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Wins (#/200 spins) Game Played

b

Semi Partial Correlation

t

p

.220 11.42

.074 .430

.473 3.05

.649 .004

Altogether, our data thus far suggests that participants who experience more LDWs during a playing session recall winning more often than participants who experience fewer LDWs. Next, we evaluated whether LDWs led players to significantly overestimate how many times they won. This analysis was performed to evaluate whether an individual participant playing a multiline game with LDWs would walk away remembering winning more often than they really had. To evaluate the possibility of an overestimation effect, we subtracted the observed number of actual wins from the participant’s estimated number of wins (i.e. the larger the resulting value, the bigger the LDW overestimation effect). Prior to analysis, we submitted participants’ overestimates (i.e. win estimates – actual number of wins) from the three-line group and six-line groups to separate recursive univariate outlier rejection procedures using the sample-size dependent cut-offs – (þ /2 2.40)(SD) and (þ /2 2.41)(SD), respectively – proposed by Van Selst & Jolicoeur (1994). The three aberrant points previously identified during the aforementioned Cook’s multivariate outlier procedure were also identified as extreme overestimates during this univariate procedure. Coinciding with the multivariate outlier rejection procedure, no other aberrant points were identified during this procedure. The remaining overestimation effect values for the three-line (relatively few LDWs) group were compared to the overestimation values for the six-line (relatively many LDWs) group using an independent t-test. As predicted, the overestimation values for the six-line (more LDWs) group (M ¼ 7.79) was significantly greater than the overestimation values for the three-line (fewer LDWs) group (M ¼ 2 1.60), t(42) ¼ 2.73, p ¼ .013. Subjective experience We surmised that if players miscategorized LDWs as wins, then participants who experienced more LDWs during the playing session may have found the game more subjectively arousing, exciting or enjoyable than participants who experienced fewer LDWs during the playing session. Our analyses, however, failed to reveal any significant difference between the many LDW (six-line) and fewer LDW (three-line) groups’ subjective playing experience (all ts , .90, all ps . .98). Verbal categorization of losses disguised as wins Following the 200-spin playing session, we evaluated whether participants would verbally miscategorize LDWs as wins or correctly categorize these outcomes as losses. Four participants never experienced an LDW during the 50-spin ‘think out loud protocol’ and, as such, were removed from subsequent analyses. Three additional participants were also excluded from subsequent analyses, as they failed to use the words ‘win’, ‘gain’ or ‘loss’ (e.g. said ‘yay’ instead) in their verbal categorizations. As shown in Figure 3, only 17.5% (N ¼ 7) participants correctly categorized LDWs as losses during the 50-spin ‘think out loud’ protocol, whereas 82.5% (N ¼ 33)

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miscategorized LDWs as wins. To gain a more conservative measure, we analysed the free reports given by participants on spins that were LDWs. Using these reports, ‘LDW miscategorizers’ were subdivided into two groups: uncertain miscategorizers and certain miscategorizers. Uncertain miscategorizers were those participants who always miscategorized LDWs as wins but at any time seemed uncertain about their miscategorization (e.g. ‘a win, I think’). Conversely, certain miscategorizers were those participants who always miscategorized LDWs as wins and never seemed uncertain about their miscategorization (e.g. ‘yay, a win of 2, about time!’). Uncertain and certain subcategorization was done by two independent coders and there was substantial agreement amongst coders, Cohen’s Kappa ¼ .669, p , .001. Given the more conservative of the two subcategorizations (i.e. the one that places the fewest people in the unaware miscategorization group), we found that only 39% (N ¼ 13) of miscategorizers ever voiced any uncertainty about their miscategorization, while 61% (N ¼ 23) of miscategorizers appeared certain that LDWs were wins. Thus, over half of our sample (57.5%) never conveyed any verbal indication that LDWs were, in fact, monetary losses. Discussion We assert that the audiovisual feedback given in multiline video slot machine games may be effective at hiding monetary loss. Novices in our study who experienced many LDWs recalled winning significantly more often than participants who experienced relatively fewer LDWs, regardless of how many times they actually won. We believe that this misremembered win frequency is one source of evidence suggesting that participants psychologically miscategorize LDWs as wins, rather than correctly categorizing these outcomes as losses. We argue that the similarity in the audiovisual feedback accompanying both wins and LDWs leads to perceptual conflation of LDWs and actual wins and, as a result, to participants’ psychological miscategorization of LDWs as wins. Therefore, we predicted that novices who experienced more LDWs during the playing session would show a larger overestimated win frequency than participants who experienced fewer LDWs. Indeed, we found that participants who played the six-line game (greater number of LDWs) significantly overestimated how many times they won compared to participants who played the three-line game (relatively fewer LDWs). Although we contend that novices miscategorize LDWs as wins, leading many individuals to estimate that they won significantly more often they actually had, some limitations should be noted and further investigated. For instance, given that we used an actual slot machine, we were unable to control for extraneous variables, such as the number of bonus rounds (if any) the participant experienced during the playing session or the size of individual (and potentially large) wins. These sources of variability would show up as error variance, and possibly reduce effect sizes since the payback percentage is the same regardless of the number of lines played. However, despite this source of ‘noise’ in the data, the LDW overestimation effect was robust enough to emerge. As another point of discussion, participants in this study were asked to estimate how many times they ‘won’ during a playing session and to categorize spin outcomes as either ‘wins’ or ‘losses’. We contend that it is possible that different participants may have interpreted a ‘win’ in one of several different ways – a spin where the machine provides audiovisual feedback, a spin where the machine returns any amount of credits, or a spin where the machine returns more credits than the participant wagered. For instance, it is quite possible that a subset of participants may have interpreted the term ‘win’ as any

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return greater than zero. However, using a ‘think out loud’ protocol during the playing session, we showed that over half of our participants not only reported that LDWs were wins, but also never verbally reported that they were losing money on these outcomes. We take this finding as a second line of evidence that many novices are unaware that they are losing money on these outcomes. One might argue that players in this study might simply be coding as a ‘win’ any return of credits from the machine, and that they fully realize that they have lost money on spins resulting in LDWs. Thus, one could argue, the current results simply stem from ambiguity in the term ‘win’. An ongoing study in our lab contradicts this view. In the new study we used more precise language to investigate how players encoded LDWs. After 400 spins on a slot machine simulator, the majority (58.1%) of novice gamblers report that they actually gained credits following an LDW, a figure that is similar to the number of participants (61%) in this study who never reported any indication that they were losing money on these outcomes during the ‘think out loud’ protocol. Moreover, when explicitly asked to estimate how many times they ‘won more than they wagered’, these miscategorizers showed an LDW overestimation effect that was similar in magnitude to that found in the present study. These combined results suggest that the audiovisual feedback accompanying LDWs may be very effective at hiding monetary loss from some novices and that these novices believe that they won money more often than they actually had. These results are important because miscategorizing LDWs as wins would effectively increase the reinforcement rates of these games despite the fact that players are losing money on these outcomes. Future research should evaluate whether participants who overestimate their winnings due to the presence of LDWs are also more likely to believe that it is possible to win on these games and/or makes them more likely to play slot machines in the future. Given that we found that the majority of novices miscategorized LDWs as wins, we also presumed that novices might find games with more LDWs more subjectively arousing, exciting or enjoyable than games with fewer LDWs. In this study, however, we failed to find any differences in participants’ subjective experiences. Below we acknowledge a few reasons why these differences may not have emerged. First, our subjective questions may not have been sensitive measures of subjective enjoyment, excitement and arousal. Future research should use subjective measures with known psychometric properties. Moreover, due to ethical constraints, participants in this study were not asked to play with their own money. This is a limitation of the study, as the (potentially exciting) element of risk in gambling was not present during game play. Second, while playing on an actual machine may be more enjoyable or arousing than playing on a simulator, the fact that we did not have precise empirical control over the outcomes (number of actual wins, losses, LDWs, size of wins, and bonus round entries) may have differentially influenced participants’ subjective experiences. In addition, participants in the three-line (relatively fewer) LDW game were asked to bet two (rather than one) credits per line in order to equate the groups’ spin wagers. As a result, despite experiencing fewer reinforced spins (wins plus LDWs) in the three-line game, these participants would have also experienced (in general) larger reinforcement on spins which could have influenced their subjective experiences. Another possibility is that novice players (or subsets of novice players) simply do not find slot machine games with more LDWs more arousing, exciting or enjoyable than games with fewer LDWs. We would like to fully acknowledge that our current results might not necessarily generalize to experienced or problem gamblers. In fact, we suggest that experienced gamblers may be fully aware that they are losing money on LDWs. Nevertheless, LDWs could still potentially influence these gamblers’ behaviours. For instance, Young, Wohl,

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Matheson, Baumann, and Anisman (2008) showed that both novices and experienced gamblers who were exposed to a ‘priming’ session with a series of small wins persisted in gambling (voluntarily) for significantly longer during a losing streak than participants who experienced a single large win that was equivalent in magnitude. They argued that this persistence is consistent with learning theory – namely, that intermittent reinforcement leads to behaviours that are more resistant to extinction. Future research should investigate whether LDWs also lead gamblers to persist in gambling for longer during a losing streak. Moreover, some gamblers are known to play slot machines for their negatively reinforcing qualities – that is, to produce emotional escape (Blaszczynski & Nower, 2002). Thus it is possible that some gamblers could be more sensitive to LDWs as they offer some rather than no return and offer external stimulation which may reduce mind-wandering and rumination. This is a hypothesis that should be tested in future research. Another possibility is that LDWs could influence gambling-related erroneous cognitions. For instance, Haw (2009) remarks that gamblers’ abilities to change the reinforcement rate, by changing the number of lines played, may be the ‘operant link between the gambler and the reinforcer’. Harrigan et al. (2012) further remark that being able to adjust the number of lines played in multiline games may foster an illusion of control for some gamblers. Langer (1975) defined the illusion of control as being a perception of success that is higher than that mandated by objective probability, and argues that any games that can foster choice (e.g., being able to choose your own lottery ticket) can lead to the propensity to misperceive games of pure chance as games of skill. Harrigan et al. (2012) argue that enabling gamblers to adjust the reinforcement rate by increasing the number of playable lines may lead gamblers to believe that they have uncovered a successful ‘strategy’ because they can maximize their number of ‘wins’. It would be fruitful for research to test this hypothesis explicitly. Despite the aforementioned limitations of this study, the current findings, when combined with the results of Dixon et al. (2010), suggest that novice gamblers appear to both somatically and psychologically miscategorize LDWs as wins rather than correctly categorizing these outcomes as the monetary losses that they truly are. As previously discussed, we believe that a utility of research on novice gamblers is to identify features of slot machine games which may lead to initial game preferences amongst new gamblers and encourage future gambling behaviours. Further research is needed to evaluate the influence of LDWs on novices’ and experienced gamblers’ behaviours. The implications of our findings are to inform future research and to help design educational materials that can promote responsible gambling, inform public policy and reduce misconceptions about slot machines – games that are available in several countries throughout the world. Acknowledgements We would like to thank Karl Borgmann and Jackey Lee for their help in coding participants’ subjective reports. We would also like to thank Ryan Lee for helping to test pilot subjects for this study. Funding for this research was provided by the Ontario Problem Gambling Research Centre and the Natural Sciences and Engineering Research Council of Canada through postgraduate scholarships to the first author and through research grants to M.J.D.

Note 1. Note that if participants in the six-line group were to bet two credits per line (as participants in the three-line group), then, on average, we would still expect participants to have the same ending balances in both groups. The reason is that the payback percentage does not change as a result of either the number of lines played or the amount of credits bet per line. If participants were to play

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six lines at two credits per line for a total spin wager of twelve credits (rather than six credits), then each win/LDW would be multiplied by two credits (i.e. larger outcomes), but each regular loss would cost more (i.e. twelve credits). The reason we kept the spin wagers identical between groups was to avoid any influence of bet size on subjective experience.

Notes on contributors

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Candice Jensen is a graduate student in Psychology at the University of Waterloo. Her research focuses on exposing relationships between gamblers’ neural, psychophysiological and cognitive interpretations of various slot machine outcomes (e.g. ‘losses disguised as wins’, ‘near misses’) and their subsequent gambling behaviours. Mike Dixon is a Full Professor of Psychology at the University of Waterloo. He has served as the Chair of the Department of Psychology at the University of Waterloo from 2005 to 2007. He has been continuously funded by the Natural Sciences and Engineering Research Council since 1997 and has also received grants from the Heart and Stroke Foundation of Canada, the Alzheimer’s Society of Canada and the Ontario Problem Gambling Research Centre. He has published over 70 articles in journals such as Nature, Addiction, Journal of Cognitive Neuroscience, Cognitive Neuropsychology and Cortex. Kevin A. Harrigan is the Head of the Gambling Research Team at the University of Waterloo. His primary research interest is in gambling addictions with a focus on why so many slot machine gamblers become addicted. Topics of interest include: the structural characteristics of slot machine games; alternative designs for slot machine games; slot machine player education; gaming regulations; PAR sheets; near misses; losses disguised as wins (LDWs); limitations of random number generators (RNGs); and computer algorithms used in slot machine games. Emily Sheepy is a research assistant with extensive expertise in the acquisition and analysis of psychophysical data. She has experience in analysing event-related and epoch-related data acquired while participants are playing slot machines. Jonathan A. Fugelsang is an associate professor at the University of Waterloo. His research focuses on how we reason about and integrate multiple, often conflicting, pieces of evidence when making complex decisions. In particular, his work examines how intuitive versus analytical thinking processes contribute to this decision-making process. These decisions may involve analogical, causal, deductive or inductive processes. To understand the mechanisms underlying these processes, he uses behavioural and functional brain imaging (e.g. ERP, fMRI) methodologies. Michelle Jarick is working on the electrophysiological brain differences between problem and nonproblem gamblers while playing slot machines. Using electroencephalographic recording (ERPs), she examines the brain activity that is produced by different slot machine outcomes (e.g. wins, losses, near misses and LDWs) as soon as they occur. She aims to uncover the neural mechanisms underlying different gambling outcomes to investigate whether or not some outcomes – for example, ‘near misses’ – are interpreted (incorrectly) by the brain as ‘wins’ or (correctly) as ‘losses’.

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