The incentives can change depending on your gear, and on how you think you'll be treated by a given enemy. (And other random people standing near by).
If I'm wearing stuff that's easily replaced then I'm more likely to take chances. Should I lose, my ability to kill other people in the future isn't compromised.
If I have a bunch of unique and/or hard to replace stuff, then I might be more risk-averse. Should I lose, my ability to kill other people in the future would be significantly compromised.
I'm also less likely to give someone a fight when either 1. I conclude that the likelihood of my killing them is next to zero, or 2. there's a decent chance I'm the one who's going to die.
I'll waive #2 if I think that I also have a good shot at killing them, and I'm reasonably sure I'm not going to lose all my stuff if I die.
The dynamic often becomes: become as potent as you can (cabal powers, skill practice, preps, gear, learning how to PK, etc.), avoid people more potent than you (and/or that you match up poorly against), then feast on people less potent than you (and/or that you match up well against).