A happy medium
Pursuit of happiness might itself boost financial wellbeing, suggests economist and eZonomics contributor Chris Dillow in his blog. “There’s a strong correlation between happiness and trust. And higher trust means higher economic growth,” he says, noting that not only do we feel happier when we can trust people, we are more likely to buy products and services we trust. Yet happiness is often left off the economic and political agenda, perhaps because it seems like a soft, sentimental approach, Dillow argues.
Hot and bothered
Men may take bigger financial risks in the presence of good-looking rivals. In an Australian experiment, heterosexual men shown pictures of male models — rather than female models or average-looking people — were more likely to bet on a 90% chance of winning AU$1,000. Those who chose not to gamble were rewarded with $100 up front. The researchers said men compete against other men for female attention, and so may seek to increase their wealth — a signifier of status. This situation may induce a “hot state” impairing rationality.
Poverty of mind
Being poor can affect our thinking as well as limit our access to resources such as money, food or shelter. An article by psychology professor Shahram Heshmat explains how scarcity tends to focus us on the here and now, drain our energies, and force us into trade-offs — sometimes to the detriment of longer-term goals. However, it also has benefits. We may sharpen our edge, concentrating on what is essential. “Scarcity prioritises our choices and it can make us more effective,” Heshmat wrote.