Applying Behavioural Economics to Serious Games

Applying Behavioural Economics to Serious Games

Applying Behavioural Economics to Serious Games

Serious games are games designed with a purpose beyond entertainment. Instead, they are meant to educate, train, inform, or drive behavioral change. They have transformative potential in health, education, corporate training, public policy, and social impact.

By using game mechanics, serious games immerse players in meaningful experiences that turn play into powerful learning or decision-making tools. When designed thoughtfully, they can cultivate new skills, shift mindsets, and even spark long-lasting behavioral change.

Key features of serious games include:

• Purpose-Driven: designed to achieve outcomes beyond mere fun, like training, social policy engagement, health & wellness, or financial literacy.

• Interactive: learning happens through doing, experimenting, and reflecting — a critical part of the experiential learning cycle.

• Engaging: crafted to capture attention and sustain participation, leveraging intrinsic drives.

• Simulative: mirror real-world systems so players can safely test strategies and see consequences.

• Measurable: structured to track progress, support feedback loops, and assess real impact.

Why Behavioural Economics Matters for Serious Games

Behavioural economics matters for serious games because it grounds design in how people actually think, feel, and behave, and not how traditional models assume they will.

It integrates insights from psychology and decision science, accounting for:

• Bounded rationality: players make decisions with limited time, data, or cognitive bandwidth.

• Social norms and preferences: players care about fairness, group behaviors, and reputations.

• Heuristics and cognitive biases: players use mental shortcuts that impact judgment.

• Emotions: pride, fear, regret, empathy that heavily shape decisions.

When serious games apply these insights, they become:

• More realistic: reflecting how people actually decide, not idealized economic agents.

• Better at driving learning: because scenarios mimic authentic cognitive and emotional pressures.

• Effective for behavioral change: by accounting for players’ biases, habits, and social influences.

• More engaging: players recognize themselves in these dynamics, making play feel meaningful.

Understanding Player Motivation

Understanding what motivates players is crucial for creating serious games that sustain engagement and drive meaningful outcomes.

Behavioural economics highlights two broad categories: extrinsic and intrinsic motivation. Each plays a unique role in serious games.

1. Extrinsic Motivation in the Context of Serious Games

Extrinsic motivation involves engaging with a game to earn rewards or avoid penalties.

In serious games, this might include:

• Earning points, badges, or certifications

• Gaining social recognition, ranking, or competitive status

• Receiving tangible incentives like vouchers or course credit

• Avoiding undesirable outcomes (e.g., failing a module)

2. Intrinsic Motivation in the Context of Serious Games

Intrinsic motivation comes from the inherent joy or meaning of the activity itself.

In serious games, players feel intrinsically motivated when they find the experience:

• Enjoyable: they simply love the gameplay’s core loop.

• Meaningful: they care deeply about the underlying purpose or story.

• Satisfyingly challenging: the game applies players’ skills in just the right way.

• Purposeful: they feel part of something bigger, tied to personal or societal goals.

Why Both Matter

Both extrinsic and intrinsic motivation are vital.

• Extrinsic incentives often scaffold initial behavior, pulling players into the experience.

• Intrinsic drives sustain long-term engagement and deeper learning.

Effective serious games use this balance to create a motivational arc: starting with external rewards that hook attention, then transitioning players toward mastery, curiosity, and self-driven exploration.

Serious Game Design Implications

The contrast between classical economic assumptions and behavioural economics reshapes how we design serious games.

1. Player Modelling and Engagement

Classical Economic Theory:

• assumes players will act rationally, maximising their payoffs/utility 

Behavioural Economics:

• recognises real human tendencies including limited reasoning capacity, fairness concerns and emotional responses

• enables serious games to mirror real-life decisions, increasing relevance and player engagement

This also links to the concept of decision space — giving players meaningful choices that reflect their real-world heuristics and trade-offs.

2. Design of Games and Challenges

Classical Economic Theory:

• focus on rational, optimal strategies and decisions

• provides perfect information environments

• focus on game equilibrium outcomes

Behavioural Economics:

• acknowledges that players may exhibit behavioural and cognitive biases

3. Measurement and Evaluation

Classical Economic Theory:

• measures success by whether players reach rational, optimal equilibrium outcomes

• does not account for deviations from “optimal” behaviour (irrationality)

Behavioural Economics:

• measures how players respond to real-world dynamics - do they learn, co-operate, or improve over time?

• provides richer diagnostic insight into human behaviour patterns

4. Social Dynamics

Classical Economic Theory:

• model assumes payoff/utility maximising players

Behavioural Economics:

• integrates trust, reciprocity, social norms & preferences, reputational risks, and moral judgments

Designing socialized environments also enhances relatedness, a key driver of intrinsic motivation.

5. Real-World Applications

Classical Economic Theory:

• assumes that learning optimisation/maximisation strategies will transfer to real-life contexts

Behavioural Economics:

• recognises the influence of that behavioural biases, emotions, and social contexts and how they influence application to the real-world scenarios

• games and scenarios reflect player emotional states, psychological pressures and cognitive limitations of the real world

This is why active debriefing after gameplay is critical — it helps players process decisions, connect them to real-world challenges, and reinforce learning outcomes.

Applying Behavioural Economics to Serious Games

When applying behavioural economics, keep these design strategies in mind:

1. Bounded Rationality

Players will not analyse every possible outcome within a serious game. They will attempt to simplify the decision process, guess, or follow a heuristic.

Design for this by: offering a manageable number of meaningful options, and layering complexity gradually across levels or stages.

2. Social Norms and Preferences

Players have a broader perspective than simply game outcomes. They also care about fairness, equity, and how others behave within the game context.

Design for this by: incorporating dilemmas (e.g. ultimatum scenarios) and simulating social consequences like trust breakdowns or peer influence.

3. Reciprocity and Trust Based Reasoning

Decisions are shaped and influenced by what players believe others will do.

Design for this by: including repeated interactions, reputation systems, and scenarios where betrayal or cooperation alters outcomes.

4. Emotional Decision-Making

Emotions like pride, guilt, regret, anger, or empathy heavily influence behaviour in serious games.

Design for this by: creating moral dilemmas, empathy triggers, or mechanisms to “live with” or undo decisions, mirroring emotional stakes of the real world.

5. Risk and Uncertainty

Players do not evaluate risk like mathematicians or economists. They often overweigh rare outcomes, avoid ambiguity, and are influenced by emotional cues.

Design for this by: building uncertainty into data or scenarios — like crisis simulations or medical diagnoses — to challenge players’ intuitive judgments.

When Extrinsic Rewards Go Wrong

Designing serious games with extrinsic reward systems can be complex and difficult. 

Be cautious with extrinsic rewards. Over-reliance can:

• Encourage players to “game the system,” chasing rewards instead of engaging deeply.

• Erode enjoyment and intrinsic interest.

• Lead to fatigue or habituation, reducing effectiveness over time.

Designing the Motivational Arc

Use a phased approach to move players from external incentives to intrinsic engagement:

Phase 1: Entry via Extrinsic Rewards

• Use points, badges, or small incentives to spark initial interest.

• Keep early tasks simple and rewarding.

Phase 2: Behavioural Scaffolding

• Introduce nudges and clear feedback to guide decisions and support skill building.

Phase 3: Internalisation

• Gradually taper external rewards.

• Emphasize mastery, curiosity, and purpose-driven goals.

• Encourage players to reflect, create, and contribute voluntarily.

This also aligns with supporting autonomy, competence, and relatedness — fostering self-driven motivation that outlasts the game itself.

Conclusion

In the end, applying behavioural economics to serious games means crafting experiences that reflect real human quirks including our biases, emotions, social ties, and desire for mastery. By balancing extrinsic hooks with intrinsic fulfillment, designing meaningful choices, and mirroring authentic risks, we create games that don’t just teach or train, they transform. Serious games become more than playful simulations; they become catalysts for genuine learning, growth, and long-lasting change.

Joint Collaboration Statement

This blog is part of a joint collaboration between Dave Eng of University XP and Nathan van den Bosch of Consensus Group Australia. If you require assistance with designing and building serious games grounded in the core principles of behavioural economics, connect with Dave and Nathan on LinkedIn - Let’s Talk. 

References

Eng, D. (2019, October 29). Gaming with motivation. Retrieved July 16, 2025, from https://www.universityxp.com/blog/2019/10/29/gaming-with-motivation

Eng, D. (2019, December 10). Decision space. Retrieved July 16, 2025, from https://www.universityxp.com/blog/2019/12/10/decision-space

Eng, D. (2023, June 27). What is Choice Architecture? Retrieved July 16, 2025, from https://www.universityxp.com/blog/2023/6/27/what-is-choice-architecture

Eng, D. (2020, July 30). What is the lusory attitude? Retrieved July 16, 2025, from https://www.universityxp.com/blog/2020/7/30/what-is-the-lusory-attitude

Eng, D. (2021, September 28). Playing serious games. Retrieved July 16, 2025, from https://www.universityxp.com/blog/2021/9/28/playing-serious-games

John, D., Hussin, N., Zaini, M. K., Ametefe, D. S., Aliu, A. A., & Caliskan, A. (2023). Gamification equilibrium: The fulcrum for balanced intrinsic motivation and extrinsic rewards in learning systems: Immersive gamification in Muhamad Khairulnizam Zaini learning system. International Journal of Serious Games, 10(3), 83–116. Retrieved July 16, 2025, from https://journal.seriousgamessociety.org/~serious/index.php/IJSG/article/view/633