Emotions in decision-making

One way of thinking holds that the mental process of decision-making is (or should be) rational: a formal process based on optimizing utility. Rational thinking and decision-making does not leave much room for emotions. In fact, reaching an optimal decision will only be impeded and confused by the impact of emotions. [1] [2] [3]

However, recent research has shown that emotions play a large role in decision-making. Pfister and Baum [4] offer a twist on how emotions and rational decision-making can be viewed: “… we believe that the issue of rationality should be based on the validity of emotional evaluations rather than on formal coherence.” In this context, questions about decision-making become: are the emotions appropriate to the situation? How do emotions impact thinking and decision-making? And, what roles do they play?

Emotions Involved in Decision-Making: The Loewenstein-Lerner Classification

Anticipated Emotions

Loewenstein and Lerner [3] divide emotions during decision-making into two types: those anticipating future emotions and those immediately experienced while deliberating and deciding. Anticipated (or expected) emotions are not experienced directly, but are expectations of how the person will feel once gains or losses associated with that decision are experienced. A great deal of research has focused on the risk/return spectrum that is considered in most decisions. For example, students may anticipate regret when deciding which section of a class is best to register for, [5] or participants in a weight-loss plan might anticipate the pleasure they will feel if they lose weight, versus the negative feelings unsuccessful efforts may engender. [6]

Generally, it is the contemplation of incremental losses or gains that generates anticipated emotions in decision-makers, as opposed to their overall condition. This means that an investor who imagines losing a small amount of money will generally focus with disappointment on the lost investment, rather than with pleasure on the overall amount still owned. Similarly, a dieter who anticipates losing two pounds may imagine feeling pleasure even though those two pounds are a very small percentage of what needs to be lost overall.

Also, decision-makers tend to compare a possible result of a decision against what could have happened, rather than to their current state: for instance, game participants who could win $1000 and end up with nothing base their disappointment on the loss of the hoped-for prize, rather than on the fact that they have no less money than they had when they began the game. This process, and the anticipation of such emotion, is referred to as a counterfactual comparison.

Finally, decision-makers tend to weight possible outcomes differently based on the amount of delay between the choice and the outcome. Decisions made with a time delay – intertemporal choice – tend to involve different weights on outcomes depending on their delay, involving hyperbolic discounting and affective forecasting. These effects are then connected to anticipated emotions as the decision is being contemplated.

Immediate Emotions

True emotions experienced while decision-making are termed immediate emotions, integrating cognition with somatic or bodily experienced components within the autonomic nervous system and outward emotional expressions. These may or may not be connected to the decision at hand, however; while contemplation of the decision’s consequences may give rise to immediate emotions, known as anticipatory or integral influences, immediate emotions can also be related to the current environment or the dispositional affect of the person. Although unrelated to the decision under consideration, this type of emotion can still impact the decision-making process as an incidental influence. [7]

Immediate emotions tend to operate differently from anticipated emotions. First, when they are intense they tend to negate the probability of the possible outcome; for example, a fear of flying experienced while deciding how to travel may lead a person to choose driving even though air safety statistics would show air travel to be statistically less likely to present a danger. The intense emotions can exact a higher influence on the decision than the probabilities under consideration. Also, immediate emotions can be very sensitive to how vivid the possible outcome is to the decision-maker. Again, a fear of flying may be enhanced by the vividness of the mental image of a plane crash may be in the mind of the decision-maker. Finally, how soon an outcome may happen impacts the related immediate emotions: the sooner the impending possible outcome, the more intense the emotion associated with that event. Overall, these emotions are real, experienced emotions, as opposed to those anticipated while thinking about possible outcomes, and as such can very powerfully impact decision-making. [8]

Impact of Emotions on Decisions

Much research has been conducted on the various impacts of emotion on decision-making. Some examples that indicate the complexity and breadth of those impacts are listed below.

• In one study, Luce (1998) found that decion-makers made to consider safety concerns that induced negative emotions when deciding which car to purchase were more likely to “choose not to choose,” or to stick with the status quo. [9]
• In another study (Leith & Baumeister, 1996), participants who experienced “frustrated anger” were more likely to choose a high risk, high reward option in a lottery – a choice the authors categorize as “self-defeating.” [10]
• Lerner, Small and Loewenstein (2004) found that study participants who had been induced to feel sad were likely to set a lower selling price for an item they were asked to sell as a part of the study; the researchers suggest that selling the item would bring about a change in the participants’ circumstances and thus perhaps a positive change in mood. [11]
• On a positive note, participants with “normal emotion processing” who, when engaged in a card-drawing task experienced losses (and associated negative emotions) when drawing from “dangerous decks,” made safer and more lucrative choices thereafter. Participants with brain damage that had left them unable to experience such emotional responses did not change their behavior in this way. [12]

Emotional Functions in Decision-Making

Pfister and Bohm (2008) have developed a classification of how emotions function in decision-making that conceptualizes an integral role for emotions, rather than simply influencing decision-making. [4]

The four roles played by emotions in this framework are:

• Providing information: This includes both positive and negative emotions that arise directly from the options being considered by the decision maker, who can then evaluate choices with this “information.” This role is especially likely when the felt emotion is reducible; that is, easily reduced to a simple comparison (for example, attraction and repulsion), and unequivocally positive or negative. Pleasure and displeasure make up the spectrum of these emotions.
• Improving speed: While making a good decision is important, making a quick decision is also important. Therefore, emotions and associated somatic conditions can offer mechanisms for encouraging a decision maker to decide quickly, especially when one or more options are potentially dangerous. Hunger, anger and fear can all induce a speedy decision.
• Assessing relevance: Emotions help decision makers decide whether a certain element of the decision is relevant to their particular situations. Each person’s personal history and state(s) of mind leads to a different set of relevant information. The two such emotions most studied to date are regret and disappointment.
• Enhancing commitment: In some ways, making the decision best for the self may be construed “the best” overall. However, acting in the best interests of others is also important in human civilization, and moral sentiments, or emotions, serve to help decision makers commit to such a decision rather than being drawn back toward pure self-interest. Emotions such as guilt and love help decision makers make such commitments.

This framework can help in exploring such concepts as ambivalence, tendencies toward particular types of action, and sustaining difficult choices over time.

Positive and Negative Emotions

Research done by Isen and Patrick (1983) put forth the theory of “mood maintenance” which states that happy decision-makers are reluctant to gamble. In other words, happy people decide against gambling, since they would not want to undermine the happy feeling.

Alternately, the influence of negative feelings at the time of decision-making was studied by Raghunathan and Tuan Pham (1999). They conducted three experiments in gambling decisions and job selection decisions, where unhappy subjects were found to prefer high-risk/high-reward options unlike anxious subjects who preferred low-risk/low-reward options. They stated that “anxiety and sadness convey distinct types of information to the decision-maker and prime different goals.” It was found that “while anxiety primes an implicit goal of uncertainty reduction, sadness primes an implicit goal of reward replacement” (Raghunathan & Tuan Pham 1999). Thus emotions cannot simply be classified as positive or negative as we need to consider the consequences of the emotions in ultimate decision-making. Emotions rule our decision making process.

See also

• Emotional bias
• Optimism
• Pessimism

References

Bagozzi, R. P. Dholakia, U. M. & Basuroy, S., 2003. How Effortful Decisions Get Enacted: The Motivating Role of Decision Processes, Desires, and Anticipated Emotions. Journal of Behavioral decision-making, 16, pp. 273–295.

Barnes, A. and P. Thagard. 1996. Emotional decisions. Proceedings of the Eighteenth Annual Conference of the Cognitive Science Society pp. 426–429.

Bechara, A. Damasio, H. & Damasio, A. R., 2000. Emotion, decision making and the Orbitofrontal Cortex. Cerebral Cortex, 10 (3), pp. 295–307.

Bower, G. H., 1981. Mood and memory. American Psychologist, 36 (2), pp. 129–148.

Damasio, A.R., Tranel, D. & Damasio, H., 1990. Individuals with sociopathic behavior caused by frontal damage fail to respond autonomically to social stimuli. Behavioural Brain Research, 41, pp. 81–94.

Dunn, B. D. Dalgleish, T. & Lawrence, A. D., 2006. The somatic marker hypothesis: A critical evaluation. Neuroscience and Biobehavioral Reviews, 30, pp. 239–271.

Isen, A. M. & Shalker, T. E., 1982. The effect of feeling state on evaluation of positive, neutral, and negative stimuli: When you “accentuate the positive,” do you “eliminate the negative”? Social Psychology Quarterly, 45 (1), pp. 58–63.

Isen, A. M. & Patrick, R., 1983.The effect of positive feelings on risk taking: When the chips are down. Organizational Behavior and Human Performance, 31 (2), pp. 194–202.

Loewenstein, G. F., Weber, E. U., Hsee, C. K. & Welch, N., 2001. Risk as feelings. Psychol Bull, 127 (2), pp. 267–286.

Sayegh, L. Anthony, W. P. & Perrewé, P. L., 2004. Managerial decision-making under crisis: The role of emotion in an intuitive decision process. Human Resource Management Review, 14 (2), pp. 179–199.

Raghunathan, R. & Tuan Pham, M., 1999. All negative moods are not equal: Motivational influences of anxiety and sadness on decision making. Organizational Behavior and Human Decision Processes, 79 (1), pp. 56–77.

[1] Kant, F. (1991). Remarks on the observations on the feeling of the beautiful and sublime. (J.T. Goldthwait, Trans.). Berkeley, CA: University of California Press. (Original work published 1764).

[2] Livet, P. (2010). Rational choice, neuroeconomy and mixed emotions. Philosophical transactions of the Royal Society B, 265, 259-269.

[3] Lowenstein, G., & Lerner, J.S. (2003). The role of affect in decision making. In R. Davidson, K. Scherer, & H. Goldsmith (Eds.), Handbook of affective science, pp. 619-642. New York: Oxford University Press.

[4] Pfister, H.R., & Bohm, G. (2008). The multiplicity of emotions: A framework of emotional functions in decision making. Judgment and decision making, 3(1), 5-17.

[5] Zeelenberg, M., van Dijk, W.W., & Manstead, A.S.R. (1998). Reconsidering the relation between regret and responsibility. Organizational behavior and human decision processes, 74(3), 254-272.

[6] Mellers, B.A., & McGraw, A.P. (2011). Anticipated emotions as guides to choice. Current directions in psychological science, 10(6). 210-214.

[7] Han, S., & Lerner, J.S. (2009). Decision making. In D. Sander and K.R. Scherer (Eds.), Oxford companion to emotion and the affective sciences, pp. 111-113. Oxford: Oxford University Press.

[8] Keltner, D., & Lerner, J.S. (2010). Emotion. In S.T. Fiske, D.T. Gilbert, & G. Lindzey (Eds.), Handbook of social psychology, pp. 317-352.

[9] Luce, M.F. (1998). Choosing to avoid: Coping with negatively emotion-laden consumer decisions. Journal of consumer research, 24(4) 409-433.

[10] Leith, K.F., & Baumeister, R.F. (1996). Why do bad moods increase self-defeating behavior? Emotion, risk taking, and self-regulation. Journal of personality and social psychology, 71(6), 1250-1267.

[11] Lerner,J.S., Small, D.A., & Loewenstein, G. (2004). Heart strings and purse strings: carry-over effects of emotions on economic decisions. Psychological science, 15(5), 337-341.

[12] Bechara, A.R., Damasio, H., Damasio, A., & Lee, G.P. (1999). Different contributions of the human amygdala ventromedial prefrontal cortex to decision-making. The journal of neuroscience, 19(13), 5473-5481.