“I Feel Therefore I Decide”: Effect of Negative Emotions on Temporal Discounting and Probability Discounting

Abstract

Temporal and probability discounting are considered two fundamental constructs in economic science, as they are associated with phenomena with major societal impact and a variety of sub-optimal behaviors and clinical conditions. Although it is well known that positive and negative affective states bear important cognitive/behavioral consequences, the effect of emotional experiences on decision-making remains unclear due to the existence of many conflicting results. Inspired by the need to understand if and to what extent the current COVID-19 pandemic has determined changes in our decision-making processes by means of the unusual, prolonged experience of negative feelings, in this study we investigate the effect of anger, fear, sadness, physical and moral disgust on intertemporal and risky choices. Results show that all emotions significantly increase subjects’ preferences for immediate rewards over delayed ones, and for risky rewards over certain ones, in comparison to a “neutral emotion” condition, although the magnitude of the effect differs across emotions. In particular, we observed a more pronounced effect in the case of sadness and moral disgust. These findings contribute to the literature on emotions and decision-making by offering an alternative explanation to the traditional motivational appraisal theories. Specifically, we propose that the increased preference for immediate gratification and risky outcomes serves as a mechanism of self-reward aimed at down-regulating negative feelings and restore the individual’s “emotional balance”.

A mini-review on how the COVID-19 pandemic affected intertemporal choice

“…Additionally, Calluso et al . ( 2021 ) found a negative correlation between compliance with containment measures and intertemporal discounting. As such, the following sections will further explore these factors in detail.…”

“…Additionally, research has indicated that in financial decision-making, the degree of social distancing, but not mask use, was statistically significantly correlated with discount rates (Agrawal et al ., 2023 ). Studies have indicated that individuals who adhered to containment regulations more strictly were more likely to prefer immediate rewards in the intertemporal choice task (Calluso et al ., 2021 ; Lloyd et al ., 2021 ). This could be attributed to the desire for freedom that could only be enjoyed in the present (Calluso et al ., 2021 ).…”

“…Studies have indicated that individuals who adhered to containment regulations more strictly were more likely to prefer immediate rewards in the intertemporal choice task (Calluso et al ., 2021 ; Lloyd et al ., 2021 ). This could be attributed to the desire for freedom that could only be enjoyed in the present (Calluso et al ., 2021 ). However, other research has not found a connection between public health policy and delay discounting (Krawiec et al ., 2022 ).…”

“…However, other research has not found a connection between public health policy and delay discounting (Krawiec et al ., 2022 ). To further explore the underlying mechanism, Studies reported a negative relationship between compliance with containment measures and intertemporal discounting (Coroiu et al ., 2020 ; Calluso et al ., 2021 ). Additionally, studies have revealed that delay discounting is inversely associated with mask-wearing behavior and complete vaccination status (Hudson et al ., 2023 ).…”

Mood fluctuations shift cost–benefit tradeoffs in economic decisions

“…These decision biases have been reproduced at a shorter time scale in the laboratory, using newspaper reports or small gifts to induce mood changes 6 – 8 . Although comparisons between groups using a single mood-inducing stimulus yielded mixed evidence 9 – 11 , comparisons between episodes created with different inductions showed that participants were generally more prone to take risks when in a good mood, and avoid risks when in a bad mood 12 – 15 . These effects qualify as decision biases because choice outcomes are independent from the events that triggered mood changes (e.g., lottery outcomes are independent from sport events).…”