Title

Acute Stress Modulates Risk Taking in Financial Decision Making

Document Type

Article

Language

eng

Format of Original

6 p.

Publication Date

3-2009

Publisher

Association for Psychological Science

Source Publication

Psychological Science

Source ISSN

0956-7976

Original Item ID

doi: 10.1111/j.1467-9280.2009.02288.x

Abstract

People’s decisions are often susceptible to various demands exerted by the environment, leading to stressful conditions. Although a goal for researchers is to elucidate stress-coping mechanisms to facilitate decisionmaking processes, it is important to first understand the interaction between the state created by a stressful environment and how decisions are performed in such environments. The objective of this experiment was to probe the impact of exposure to acute stress on financial decision making and examine the particular influence of stress on decisions with a positive or negative valence. Participants’ choices exhibited a stronger reflection effect when participants were under stress than when they were in the nostress control phase. This suggests that stress modulates risk taking, potentially exacerbating behavioral bias in subsequent decision making. Consistent with dual-process approaches, decision makers fall back on automatized reactions to risk under the influence of disruptive stress.

Comments

Psychological Science, Vol. 20, No. 3 (March 2009): 278-283. DOI.