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There are situations when the answer is incorrect or of poor content. Flagging is not allowed for such answers and is often declined. The best option is to downvote.

Why should a person lose their points for downvoting a bad answer? I don't understand the concept of it. This discourages people from downvoting bad answers. Only the truly altruistic people do it.

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There are a million details about the philosophy behind this in this blog post, but here's the relevant part:

And, on top of that, downvotes cost you a tiny bit of reputation. The net effect is that you have to feel very strongly about something to downvote it. Downvotes are serious business, and not to be cast lightly. We designed our system around that maxim.

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It seems the points cost is (at least in part) to help prevent tactical down-voting, a process of pushing one's own answers further up the rankings by down-voting its rivals. Answers which already have a lot of up-votes tend to attract more votes thus by being at the top quickly one can get more votes (some people care far too much about their points - personally I am proud of the points I have achieved because they tell me that people value my contribution and thus there is a benefit to my getting involved with BiologySE, but I don't see the point of getting tactical, what importance do the points really have - no one is going to employ you on the basis of your BiologySE rep!!).

Perhaps an improvement of the system would be one which can recognize tactical voting - I'd suggest that if a post has a score of -2 or lower, or has accumulated several down-votes but remains positively scored (e.g. has total score of 5 from 10 up-votes and 5 down-votes) then the down-vote should be free of charge. If a user down-votes something which has no other/only few down-votes (the threshold number of down-votes would have to be based on the specific needs of the SE site - something is far more likely to accrue one or two tactical down-votes on a large site like stackoverflow due to the number of users and hits) they get charged (but it is refunded if others agree).

Subsequently it would offer a viable option when the post is not good (worthy of down-voting) but not worthy of flagging (flag likely to be declined).

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