The magnification of skill component in gambling as well as the gambler's and hot hand fallacies are gambling-related cognitive distortions. The magnification of skill component refers to the belief that one's ability can be used to win in gambling and that there is a reliable way to do so. The gambler's fallacy refers to the belief that a given outcome is unlikely to follow a preceding run of the same outcome (e.g. a coin coming up heads following a run of heads), while the hot hand fallacy refers to the belief that a streak of wins is going to continue. The biopsychological basis of these cognitive distortions can be analyzed by examining the processing of near outcomes and outcome sequences in gambling. Near outcomes refer to close wins and losses that would have almost resulted in the other outcome.
The current study aims to investigate the electrophysiological basis of said cognitive distortions as well as its modulation by gambling problems. In the current study a group of problem gamblers and matched controls gambled on a wheel of fortune and a coin toss paradigm. The processing of near outcomes and outcome sequences was analyzed using event-related potentials (FRN, P300). Near outcomes evoked smaller P300 amplitudes in both groups. Furthermore, previous wins were associated with increased P300 amplitudes. Outcome closeness and previous outcome sequences did not modulate the FRN amplitude. The processing of near outcomes and outcome sequences was not modulated by gambling problems. General differences between problem gamblers and controls were found, with problem gamblers showing reduced peak-to-peak FRN amplitudes. This might point towards a generally more favorable evaluation of gambling outcomes in problem gamblers while the electrophysiological correlates of the analyzed cognitive distortions do not differ from those of healthy controls.