Confirmed: Sadness makes people financially shortsighted
Those who watched the sad video typically picked the immediate rewards while ignoring greater gains that would require waiting. As such, the sad participants earned significantly less money in the experiments than subjects who watched the neutral clip or disgusting video, the researchers found.
“These experiments, combining methods from psychology and economics, revealed that the sadder person is not necessarily the wiser person when it comes to financial choices,” the researchers concluded. “Instead, compared with neutral emotion, sadness — and not just any negative emotion — made people more myopic, and therefore willing to forgo greater future gains in return for instant gratification.”
The team, led by Harvard psychological scientist Jennifer Lerner, dubbed this phenomenon “myopic misery” and argued that their findings could have implications for areas such as estate planning and credit card regulations.