Emotional news stories have a strong impact on men's financial decisions, according to new research.
The research - conducted at the University of Nottingham's Centre for Decision Research and Experimental Economics, with collaborators from the University of Essex and Bournemouth University - revealed that men are far more likely than women to let emotions from one situation carry over into unrelated risky decisions.
In the study, 186 people watched real life news stories that were expected to stimulate emotional reactions and were then asked to make risky financial decisions with real money at stake. After watching the news stories, men became significantly less willing to take financial risks even though the decisions were completely unrelated to the news. However, the decisions of women appeared completely unaffected by having watched the same news.
Our results show that while women self-report similar, and sometimes even stronger, emotional reactions to the news, their decisions in settings unrelated to the news appear much more stable, challenging any stereotype of women as, relatively, emotionally driven in their actions."
Offering a possible account of the differences observed between men and women, the lead author Dr Nikhil Masters, from Essex's Department of Economics, said: "Previous research has shown that emotional intelligence helps people to manage their emotions more effectively. Since women generally score higher on emotional intelligence tests, this could help explain the big differences we see between men and women."
The findings provide fresh evidence to support regulatory requirements such as cooling-off periods following decisions, especially important decisions which may be associated with strong emotional responses – for example those with potentially large, positive or negative consequences.
The paper, published in the Journal of Behavioral and Experimental Economics, can be found on ScienceDirect.
