Health : The Atlantic: Study: Feeling Left Out Makes People Take Financial Risks

Health : The Atlantic Health news and analysis on The Atlantic.

Study: Feeling Left Out Makes People Take Financial Risks Aug 2nd 2013, 18:00, by Julie Beck The Ugly Duckling (Wikimedia Commons) Problem: Popularity and money are two of the main ways we satisfy ourselves. And while friends come and go, a bathtub full of money is forever. So when people are excluded socially, we often turn to money, spending it in strategic ways to become included, stressing about spending, and becoming generally miserly, perhaps thinking of the coins as treasured friends. Study: 'Anti-Aging' Antioxidant Actually Seems to Undo Effects of Exercise Athletes Perform Better Under Pressure When They Make a Fist With Their Left Hand Meditation Improves Attention, Memory Researchers in Hong Kong took this one step further, positing that people cut out from a group may become loose cannons, willing to take bigger financial risks in hopes of a bigger payout Methodology: Fifty-nine University of Hong Kong undergrads participated in an online ball-throwing exercise designed to make them feel either included or excluded, then were asked to choose between two lottery options: one with an 80 percent chance of winning $200 and one with a 20 percent chance of winning $800. Two other, similar experiments using essays to manipulate feelings were designed to rule out low self-esteem and general crankiness as motivations for risk-taking. In another experiment, researchers had some participants read a report that claimed people often mistakenly believe money brings more freedom and control to their lives before participating in an investment exercise. Results: Even accounting for self-esteem issues and sadness, participants who felt excluded tended to favor the risky bet. The researchers also interviewed people around Hong Kong, asking them to choose between the same two bets, and then self-assess how often they gambled and bet on horse races, how risky their investments were and how often they felt socially excluded. The interview yielded much the same results. But in the experiment where the researchers planted the idea in participants'  heads that money isn't instrumental, the excluded took no more risks than the included. Implications: "In absence of social support, forlorn consumers begin to acutely seek and value money as an alternative means to secure what they want out of the social system," the study reads. Or, lonely people do crazy things for love and money. Let's all be nice to our friends, so they'll have sound financial futures. The study, "Show Me the Honey! Effects of Social Exclusion on Financial Risk-Taking," appeared in the June 2013 edition of the Journal of Consumer Research, and was presented yesterday at the American Psychological Association's 121st Annual Convention.

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