BazermanMoore

Emotional Influences on Decision Making 97
Each of these emotions can influence judgments. For instance, Lerner, Small,
and Loewenstein (2004) have found that emotional state can have a significant effect
on the nature of the endowment effect. The endowment effect, which we introduced
in Chapter 4, describes the fact that the value people place on a commodity is greater
if they own the commodity than if they do not (Kahneman, Knetsch, & Thaler, 1990).
Lerner and her colleagues (2004) explored what happens to selling prices of a commodity
(set by those who own it) and choice prices (set by those who are choosing
between the commodity and money) if sellers are in a sad or disgusted state rather
than in a more neutral state. They induced disgust by showing participants a film
clip depicting intimate use of an unsanitary toilet (from the film Trainspotting).
They induced sadness by showing participants a film clip dramatizing the death of a
boy’s mentor (from The Champ). The results showed that disgust triggered the desire
to expel, making people more eager to get rid of things they owned and avoid
acquiring new things. Consequently, disgust led sellers to be willing to sell at lower
prices, and led potential buyers to lower how much they would be willing to pay.
In contrast, sadness triggered the goal to change one’s circumstances, thereby increasing
people’s willingness to pay to buy and decreasing the price they demanded
to sell.
With this study, Lerner and her colleagues (2004) show how emotions can
affect financial decisions. More interestingly, by manipulating emotion in a separate
task that occurs prior to the buying and selling decisions, they show how emotional
influences bleed over from one context to another, unrelated context. Even more important,
this research demonstrates the need for a clear and precise understanding of
how emotion affects decision making. Many scholars have assumed that emotions could
be categorized simply into positive and negative emotions. But Lerner, Small, and
Loewenstein (2004) show that two different negative emotions can create two very
different patterns of effects.
Emotions are tightly wound up with our perception of risk (Slovic & Peters, 2006).
Happy people are more optimistic, while sad people are more pessimistic (Loewenstein,
Weber, Hsee, & Welch, 2001). In addition, fear and anxiety create risk-averse
behavior (Lerner & Keltner, 2000). But angry people are especially willing to endure
risk, and even appear quite optimistic with respect to risk (Leith & Baumeister, 1996;
Tiedens & Linton, 2001). Angry people think that their risk is lower for a wide variety of
career and health risks (Lerner & Keltner, 2001). Ironically, angry people even believe
their risk of heart disease is lower than do others (Taylor, Lerner, Sage, Lehman, &
Seeman, 2004). This is ironic, because those who experience more anger are actually at
heightened risk of heart disease (Williams, Patson, Siegler, Eigenbrodt, Neieto, &
Tyroler, 2000).
Mood-Congruent Recall
Depressed people often report that the bleakest aspect of their depression is that they
cannot remember what it felt like to not be depressed. Similarly, when people are happy,
they might have trouble recalling how they felt during more difficult times. Human
resource consultants advise that it is best to ask the boss for a raise when he or she is in