Featured Research

from universities, journals, and other organizations

When Positive Thinking Leads To Financial Irresponsibility Like Compulsive Gambling

Date:
April 22, 2008
Source:
University of Chicago Press Journals
Summary:
Looking on the bright side can lead to irresponsible financial behavior, reveals a new article. In a series of studies, scientists examine repeat gambling in the face of loss. They find that people often engage in too much positive thinking, selectively focusing on one win among hundreds of losses when they think back on the overall experience.

Looking on the bright side can lead to irresponsible financial behavior, reveals an article in the Journal of Consumer Research. In a series of studies, Elizabeth Cowley (University of Sydney) examines repeat gambling in the face of loss. She finds that people often engage in too much positive thinking, selectively focusing on one win among hundreds of losses when they think back on the overall experience.

"When we want to justify engaging in an activity which could potentially be irresponsible -- like gambling -- we may need to distort our memory of the past to rationalize the decision," Cowley explains. "People who have frequently spent more money than planned on gambling edit their memories of the past in order to justify gambling again."

For example, Cowley had participants in one study play a computer game in which they could win credits with the financial equivalent of one cent per credit. Each participant played the game 300 times. Everyone experienced one big win and one big loss. But for the other 298 games, one half of the group experienced all small losses, while the other experienced all small wins.

Cowley also manipulated the distance between the big win and the big loss.

A week later, participants were surveyed for their memories of the experience. Surprisingly, Cowley found that even some losers remembered having a positive experience. If the big win and the big loss occurred far apart, losers had fond memories and indicated a willingness to spend their own money on the game.

As Cowley explains, the further apart the big win and the big loss, the easier it was for losers to isolate their memories and focus only on the positive, a "silver lining" effect.

"The tendency to segregate positive and negative events in a mixed-loss experience is based on the logic that remembering a large gain allows people to feel good even when the objective outcome was negative," Cowley says.

Conversely, Cowley found that winners -- those who experienced 298 small wins -- were happier when the big win and the big loss were closer together, allowing them to lump all the games together and ignore the big loss. She termed this the "cancellation effect."

"When the outcome of an experience including both positive and negative events results in a net gain, people look for ways to integrate positive and negative events to reduce, if not cancel, the pain associated with the negative events," Cowley explains.

The research is the first to consider a motivated memory explanation for justifying irresponsible behavior. Apparently, positive thinking can sometimes be negative.

Journal reference: Elizabeth Cowley, "The Perils of Hedonic Editing." Journal of Consumer Research: June 2008.


Story Source:

The above story is based on materials provided by University of Chicago Press Journals. Note: Materials may be edited for content and length.


Cite This Page:

University of Chicago Press Journals. "When Positive Thinking Leads To Financial Irresponsibility Like Compulsive Gambling." ScienceDaily. ScienceDaily, 22 April 2008. <www.sciencedaily.com/releases/2008/04/080421111630.htm>.
University of Chicago Press Journals. (2008, April 22). When Positive Thinking Leads To Financial Irresponsibility Like Compulsive Gambling. ScienceDaily. Retrieved April 17, 2014 from www.sciencedaily.com/releases/2008/04/080421111630.htm
University of Chicago Press Journals. "When Positive Thinking Leads To Financial Irresponsibility Like Compulsive Gambling." ScienceDaily. www.sciencedaily.com/releases/2008/04/080421111630.htm (accessed April 17, 2014).

Share This



More Mind & Brain News

Thursday, April 17, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Are School Dress Codes Too Strict?

Are School Dress Codes Too Strict?

AP (Apr. 16, 2014) Pushing the limits on style and self-expression is a rite of passage for teens and even younger kids. How far should schools go with their dress codes? The courts have sided with schools in an era when school safety is paramount. (April 16) Video provided by AP
Powered by NewsLook.com
Could Even Casual Marijuana Use Alter Your Brain?

Could Even Casual Marijuana Use Alter Your Brain?

Newsy (Apr. 16, 2014) A new study conducted by researchers at Northwestern and Harvard suggests even casual marijuana use can alter your brain. Video provided by Newsy
Powered by NewsLook.com
Couples Who Sleep Less Than An Inch Apart Might Be Happiest

Couples Who Sleep Less Than An Inch Apart Might Be Happiest

Newsy (Apr. 16, 2014) A new study by British researchers suggests couples' sleeping positions might reflect their happiness. Video provided by Newsy
Powered by NewsLook.com
Cognitive Function: Is It All Downhill From Age 24?

Cognitive Function: Is It All Downhill From Age 24?

Newsy (Apr. 15, 2014) A new study out of Canada says cognitive motor performance begins deteriorating around age 24. Video provided by Newsy
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:

Breaking News:
from the past week

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile: iPhone Android Web
Follow: Facebook Twitter Google+
Subscribe: RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins