‘There are two types of people’ is the common opening for a number of jokes and idioms, but as research carried out by ISET alumnus Ala Avoyan (now of the University of Indiana) shows, there is some truth to this old adage.

Two different types of character were revealed over the course of the study, which investigated ‘history-dependent stopping’ factors in scenarios without any financial components. Using hundreds of chess games, Ala discovered that repeated losses or victories are indicators of whether a participant will continue to play; enjoyment from the next game, therefore, is derived from the result of the match preceding it. The incentive to stop or not is the variable that differentiates the two types.

Ala’s research was carried out with the assistance of two more ISET alumni, Robizon Khubulashvili and Giorgi Mekerishvili, both of the University of Pennsylvania. They identified the two types as being those who were discouraged by a loss and gave up, and their counterparts who found a loss motivating, being further encouraged to try and win.

The researchers further identified ‘extreme loss-stoppers’, who always stop after a loss, and ‘extreme win-stoppers’, who always stop after a win. They also found that predictive elements such as ‘the gambler’s fallacy’ played a role, in which a player may believe that after a few losses, the probability of the next game being a win is higher.

Naturally, the findings were highly applicable to behavioral economics (Ala herself being a behavioral economist), even though the study was carried out without any financial variable. The research was also interesting to non-economists, as a measure of human psychology and the points at which some people will quit and others continue.

ISET is grateful to Ala for taking the time to re-visit the institute, and for standing as an example to its current generations of what can be achieved post-graduation.