(Press-News.org) Your emotions can certainly impact your decisions, but you might be surprised by the extent to which your emotions affect your pocketbook. New research from psychological scientist Jennifer Lerner of the Harvard Kennedy School of Government and colleagues Yi Le and Elke U. Weber of Columbia University explores how impatience brought on by sadness can in turn produce substantial financial loss. The study is published in Psychological Science, a journal of the Association for Psychological Science.
Using data collected at the Harvard Decision Science Laboratory and the Center for Decision Sciences at Columbia, the authors found that subjects randomly assigned to view a video that induced sadness exhibited impatience and myopia, which were manifested in financial decisions that elicited higher gains in the short term, but lesser gains over the longer term. Thus, subjects in the sadness condition earned significantly less money than subjects in the neutral condition. They showed what is known as "present bias," wherein decision makers want immediate gratification and so they ignore greater gains associated with waiting.
"Across three experiments, the median sad participant valued future rewards (i.e., those delayed by 3 months) 13% to 34% less than did the median neutral-state participant. These differences emerged even though real money was at stake and even though discount rates in the neutral condition were already high," the authors reported.
"These experiments, combining methods from psychology and economics, revealed that the sadder person is not necessarily the wiser person when it comes to financial choices," they concluded. "Instead, compared with neutral emotion, sadness — and not just any negative emotion — made people more myopic, and therefore willing to forgo greater future gains in return for instant gratification."
Lerner and her co-authors contend that the findings have important implications for the design of public policy — in areas such as estate planning and credit card regulations.
"Public-policy design and implementation need to be based on consideration of the full range of psychological processes through which decisions are made," the authors argue. "Fully understanding these processes may also help address the economic problems associated with Americans' increasing reliance on credit cards."
Jennifer Lerner is Professor of Public Policy and Management at the Harvard Kennedy School of Government as well as Director of the Harvard Laboratory for Decision Science. This inter-disciplinary laboratory, which she co-founded with two economists, draws primarily on psychology, economics, and neuroscience to study human judgment and decision-making.
###
This research was supported by National Science Foundation Grants PECASE SES-0239637 and SES-0820441 to Jennifer S. Lerner and Grant SES-0820496 to Elke U. Weber.
For more information about this study, please contact: Jennifer S. Lerner at jennifer_lerner@harvard.edu.
The APS journal Psychological Science is the highest ranked empirical journal in psychology. For a copy of the article "The Financial Costs of Sadness" and access to other Psychological Science research findings, please contact Anna Mikulak at 202-293-9300 or amikulak@psychologicalscience.org.
END
Research out of the University of Cincinnati seeks to measure economic and political policy impacts that unions associated with criminal justice systems – such as police, correctional officers and dispatchers unions – have in their respective states.
That research, titled "Measuring the Effect of Public-Sector Unionization on Criminal Justice Public Policy" by UC criminal justice doctoral students Derek Cohen and Jay Kennedy, will be presented at the American Society of Criminology conference on Nov. 17.
It's a research effort that stems from and seeks to shed light ...
Richmond, Va. (November 13, 2012) – In laboratory experiments, scientists have eliminated metastasis, the spread of cancer from the original tumor to other parts of the body, in melanoma by inhibiting a protein known as melanoma differentiation associated gene-9 (mda-9)/syntenin. More than 1 million cases of skin cancer are diagnosed each year in the U.S., and melanoma is the deadliest form. With further research, the approach used by the scientists could lead to targeted therapies that stop metastasis in melanoma and potentially a broad range of additional cancers.
The ...
VIDEO:
On Nov. 13, 2012, a narrow corridor in the southern hemisphere experienced a total solar eclipse. The corridor lay mostly over the ocean but also cut across the northern tip...
Click here for more information.
On Nov. 13, 2012, a narrow corridor in the southern hemisphere experienced a total solar eclipse. The corridor lay mostly over the ocean but also cut across the northern tip of Australia where both professional and amateur astronomers gathered to watch.
During ...
The twenty-fifth tropical depression of the western North Pacific Ocean season formed today and is already affecting southern Vietnam. NASA's Aqua satellite passed over Tropical Depression 25W and captured a visible image of the storm that showed its northern quadrant raining over the country.
When NASA's Aqua satellite passed over newborn Tropical Depression 25W (TD25W) on Nov. 14 at 0638 UTC (1:38 a.m. EDT), the Moderate Resolution Imaging Spectroradiometer (MODIS) instrument captured a visible image of the storm. At the time of the image, the strongest thunderstorms ...
Sometimes simplicity is best. Two Northwestern University researchers have discovered a remarkably easy way to make nanofluidic devices: using paper and scissors. And they can cut a device into any shape and size they want, adding to the method's versatility.
Nanofluidic devices are attractive because their thin channels can transport ions -- and with them a higher than normal electric current -- making the devices promising for use in batteries and new systems for water purification, harvesting energy and DNA sorting.
The "paper-and-scissors" method one day could ...
An international research team including scientists from the University of Toronto's Faculty of Medicine has discovered a link between a mutation in an immune system gene and Alzheimer's disease.
Using data from 25,000 people, researchers from the Faculty of Medicine and University College London's Institute of Neurology discovered that a rare genetic mutation in the TREM2 gene — which helps trigger immune system responses — is also associated with increased risk of Alzheimer's. The discovery supports an emerging theory about the role of the immune system in the disease. ...
Noting that active-duty servicewomen have higher rates of unintended pregnancy than the general population and lower reported contraception use, one researcher at Women & Infants Hospital is suggesting the answer might be a review of the health care offered to females in the military and veterans.
Vinita Goyal, MD, MPH, published the study "Unintended pregnancy and contraception among active-duty servicewomen and veterans" in a recent issue of the American Journal of Obstetrics & Gynecology. As part of her research, conducted in cooperation with the Veteran's Administration ...
Georgia Tech, along with partner research organizations on the Keeneland Project, including the University of Tennessee-Knoxville, the National Institute for Computational Sciences and Oak Ridge National Laboratory, announced today that the project has completed installation and acceptance of the Keeneland Full Scale System (KFS). This supercomputing system, which is available to the National Science Foundation (NSF) scientific community, is designed to meet the compute-intensive needs of a wide range of applications through the use of NVIDIA GPU technology. In achieving ...
Not only is Oak Ridge National Laboratory's Titan the world's most powerful supercomputer, it is also one of the most energy-efficient.
Titan came in at number three on the Green500 list. Organized by Virginia Tech's Wu-chun Feng and Kirk Cameron, the list takes the world's 500 most powerful supercomputers—as ranked by the Top500 list—and reorders them according to how many calculations they can get per watt of electricity.
The Green500 list was announced Wednesday during the SC12 supercomputing conference in Salt Lake City.
Titan's position reflects a significant ...
Compared to the nation, a higher proportion of children in California are uninsured, one in every 10 children or more than 1.1 million in 2011. More of California's children have public health insurance and fewer through their parents' employer. And, over the past three years, a decade of advances in California children's public insurance enrollment has stalled, as coverage in Healthy Families (California's children's health insurance program) declined as a result of reductions in state government funding.
These are just a few of the findings in a new report from the ...
