Yawning is contagious. So too, it seems, are being fat, being sad, and a host of other things that we social creatures tend to pick up from each other. In a study published this week in the Journal of Experimental Social Psychology, scientists picked out one more trait that could be contagious among connected people: making bad business decisions.
Researchers had already confirmed that people have a hard time letting go of their own bad investments. For example, someone who buys a lemon of a car or a dilapidated house will, instead of owning up that it was a mistake and cutting their losses, continue to commit to the project and pour more money, effort and emotions into it [Los Angeles Times]. The key finding in this study, however, was that this bad business psychology can spread to others.
(more…)
Historians believe they’re settled a long-running debate over ancient Rome’s population at the turn of the 1st century B.C.E. thanks to stashes of ancient Roman coins. This was the period marked by Julius Caesar’s assassination and the Roman empire’s collapse, but surprisingly, historical records during the war-torn era show a population explosion in Rome. Census data, thought to only account for males, gives a population increase from 400,000 in 2nd century B.C.E. to between 4 and 5 million at the 1st century B.C.E.
But some historians argue that the population didn’t really increase, and that in fact it declined during this period because of the wars. To back up their idea they are turning to buried treasure. In times of instability in the ancient world, people stashed their cash and if they got killed or displaced, they didn’t come back for their Geld. Thus, large numbers of coin hoards are a good quantitative indicator of population decline, two researchers argue in in the Proceedings of the National Academy of Sciences Monday [Wired.com].
(more…)
One thing we might have to look forward to should we fall deeper into a recession—a boost in public health. Americans were healthier during the Great Depression than the stronger economic periods surrounding the slump, according to a surprising new study.
Researchers studied life expectancies, mortality rates, GDP, and unemployment rates from 1920 to 1940. The team found an inverse association between economic health and population health: Life expectancy fell during economic upturns and increased during recessions. Mortality, meanwhile, tended to rise during economic upturns and fall during recessions. Deaths related to flu and pneumonia, for example, fell from about 150 per 100,000 people in 1929 to roughly 100 per 100,000 people in 1930, the researchers report online today in the Proceedings of the National Academy of Sciences [ScienceNOW Daily News].
The researchers won’t say for sure why this is, but they offer several theories. When the economy is growing, people tend to sleep less and smoke and drink more. They also engage in more strenuous labor, endure more work stress and breathe more polluted air. Traffic and industrial accidents rise [Los Angeles Times]. The one exception, of course, is suicides. As times get harder suicides go up, but during the time period studied they accounted for less than 2 percent of all deaths.
Related Content:
80beats: Stats Suggest Recession Prevented Over 70K Babies From Being Born
80beats: Pop Music & Blogs as Indicators of Gross National Happiness
80beats: What Does the Economic Crisis Mean for the Green Tech Sector?
Image: flickr / Tony the Misfit
Rats in laboratory tests learned to gamble based on a system of punishments and rewards, strategizing like human gamblers. And when researchers tweaked the animals’ brain chemistry to mimic that of humans with a gambling addiction, the mice began taking risks like pathological gamblers, according to a study published in the journal Neuropsychopharmacology.
To create this animal model of gambling addiction, researchers created a system in which options that could bring greater rewards also could yield stronger punishment. In this case, however, instead of gambling for money, the rats aimed to get as many sugar pellets as possible. The rodents were placed in specially built boxes whose walls incorporated four “response holes.” Each opening was associated with a possibility of earning treats – from one up to four, depending on the aperture chosen. When an animal poked its snout into a hole, the movement would break an infra-red light across the opening, signaling a computer with a “probabilistic” reward-punishment schedule to assign a pellet win or a “timeout” loss. Playing against the clock, the rats had only 30 minutes to accumulate as many sugar pellets as they could [The Canadian Press].
The rats quickly caught on that by choosing the openings that offered the greatest number of pellets, they also risked the longest time-outs during which they could not play the game. The test was based on an evaluation for decision-making in humans called the Iowa Gambling Test. In that game, there are some “bad” decks of cards that offer high rewards and punishments, and other “good” decks that offer lesser rewards and punishments.
(more…)
Leaving the rainforest of the Amazon standing has obvious benefits to the environment, as the living forests absorb and store carbon dioxide that would otherwise contribute to global warming. But cutting down the forests has been assumed to be the only route to economic development for the local people, as it provides work in the timber industry and then clears the way for farming and cattle raising. Now, a new study has found that deforestation brings only short-term and temporary economic benefits, in what researchers call a boom-and-bust cycle.
The researchers say the boom is probably due to a number of factors, including better roads and therefore better access to healthcare and schools. For a short while, the community benefits from the natural resources of the forest, and makes money off the timber and the farms that are set up in the cleared lands. But the soil is rapidly degraded making farming and cattle ranching unsustainable. “A lot of that land ends up being abandoned” [New Scientist], says study coauthor Robert Ewers.
(more…)
When people are given “expert” financial advice, the decision-making parts of the brain shut down, a small new study has found. Brain scans of 24 volunteers showed that claims of expertise were found to suppress activity in the neural circuit linked to decision-making [Telegraph]. “It’s almost as if the brain stops trying to make a decision on its own” [CNN], said lead researcher Gregory Berns.
In the study, college students connected to MRI scanners were asked to choose between taking a guaranteed payment and gambling for a higher payoff. Some made the decision on their own, while others were given written advice that they were told came from an economist who counsels the U.S. Federal Reserve. The advice was intentionally poor, and urged students to accept the guaranteed small payments rather than gamble with good odds for a much higher return. When thinking for themselves, students showed activity in their anterior cingulate cortex and dorsolateral prefrontal cortex — brain regions associated with making decisions and calculating probabilities. When given advice from [the economist], activity in those regions flat lined [Wired]. The students who received the advice tended to follow it.
(more…)
To a gambler’s brain, a near miss provides almost the same high as a win, according to a new study that helps explain the allure of slot machines and the difficulty that some gamblers have in walking away. “The near-miss is quite a paradoxical event,” [researcher Luke] Clark says. Gamblers who almost win put “their head down in their hands — they can’t believe it. And then the next thing they do is place another bet” [Science News].
In the small study, published in Neuron [subscription required], researchers had 15 volunteers play a slot machine while their brain activity was recorded with fMRI scans. When the researchers compared the scans, they found that near misses drew more blood to reward regions such as the insula and the ventral striatum than full misses did [ScienceNOW Daily News]. These areas are also activated by rewards like chocolate and cocaine; when the near misses partially activated the so-called reward pathway, it released pleasant doses of the brain chemical dopamine.
(more…)
Men who want to know if they’d make it as day traders on Wall Street just have to look down at the fingers, according to a new study. The longer their ring fingers are in relation to their pointer fingers, the more likely they are to have what it takes to make millions on the trading floor. Previous research has found that the digit ratio reflects how much testosterone an unborn baby was exposed to in the womb. Those exposed to high levels of the hormone are more sensitive as adults to testosterone that creates feelings of confidence and encourages risk-taking, said study author John Coates [Bloomberg].
Coates has previously shown that traders who register the highest levels of testosterone in the morning make the most money through the course of the day, and this new study adds to the earlier work by suggesting that their advantage may have been innate, not learned. Although it may come as no surprise that testosterone could be a big player in the mano-a-mano world of Wall Street, the research offers the best evidence yet of the hormone’s role in determining which would-be Masters of the Universe will thrive. It also supports the growing recognition that biology plays a role in complex human behaviors, and that financial choices in particular are often less rational than economists appreciated [Washington Post].
(more…)
As the turmoil continues in the world’s financial systems and countries brace for an economic downturn, many environmentalists and green tech entrepreneurs are posing the question: How will this crisis impact the young renewable energy sector?
Some worry that ambitious projects won’t be able to get the financing they need from troubled banks wary of lending money, while others note that oil prices have dropped fast based on predictions of lower demand. Advocates are concerned that if the prices for oil and gas keep falling, the incentive for utilities and consumers to buy expensive renewable energy will shrink. That is what happened in the 1980s when a decade of advances for alternative energy collapsed amid falling prices for conventional fuels [The New York Times].
In Europe, environmental ministers are meeting to finalize the European Union’s goals for cutting the greenhouse gas emissions that cause global warming, but new discord has broken out. Nations like Italy and Poland have begun to argue that emission cuts must be scaled back to avoid further hardship for industry during the hard economic times. Italian Prime Minister Silvio Berlusconi said: “Our businesses are in absolutely no position at the moment to absorb the costs of the regulations that have been proposed” [BBC News].
(more…)
In a finding that has particular relevance right now, as the American public looks for scapegoats for the current financial crisis, a new study has found that men with higher levels of testosterone are inclined to make riskier financial decisions. Just how much riskier? Those with 33 percent more testosterone than average men invested 10 percent more of their dough. The findings are based on saliva samples from 98 male Harvard students taken before they played an investment game with $250 in real money [Scientific American].
Researchers say they didn’t outright prove that it was Wall Street men’s hormones that got us into this mess, but that the evidence is strongly suggestive. “Although our findings do not address causality, we believe that testosterone may influence how individuals make risky financial decisions,” said researcher Coren Apicella…. A recent study also showed that stock market traders made more money on days when their testosterone levels were highest [LiveScience].
(more…)
Ever wondered what causes the spate of wild bidding in the last few minutes of an Ebay auction? Scientists say they now have answer: The irrational behavior is caused by people’s fear of losing, not their desire to win. While economists have recognized the concept of “loss aversion” for some time, a new set of experiments used brain scans and lab experiments to show how strongly the phenomenon plays out in auctions, and how it’s tied to overbidding.
In the first experiment, test subjects participated in either a lottery or an auction. During the games, scientists watched the responses of the subjects’ striata—the brain’s reward center—using functional magnetic resonance imaging (fMRI). The elation of winning was the same in both games, but the agony of defeat was crushing for losers of the auction. After auction, brain activity in the loser’s reward centers decreased substantially. But it hardly blipped when the person lost a lottery [Ars Technica]. What’s more, auction losers who had the steepest declines in striata activity were more likely to have overbid during the auction.
(more…)
