Showing posts with label Behavioral Economics. Show all posts
Showing posts with label Behavioral Economics. Show all posts

Wednesday, January 2, 2013

Nine Ways Successful People Defeat Stress

Note From Jim: I’m a follower and fan of Heidi Grant Halverson’s work. Want to enhance the success of your own goal achievement or that of your teams? Embrace Nancy's advice, all of which is drawn from research.  Click on the link below.


Excerpts – Nine Ways:

1. Have self-compassion

2. Think about the “Big Picture”

3. Rely on routines

4. Take five (or ten) minutes to do something you find interesting

5. Add where and when to your To Do List

6. Use if-thens for positive self-talk

7. See your work in terms of progress, not perfection

8. Think about the progress that you’ve already made

9. Know whether optimism or defensive pessimism works for you

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Access Article And Other Great Stuff At Nancy's Website: http://www.heidigranthalvorson.com/
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Heidi Grant Halvorson is a rising star in the field of motivational science. She is a an expert blogger for Fast Company, WSJ.com, Forbes, The Huffington Post, and Psychology Today, as well as a regular contributor to the BBC World Service's Business Daily, the Harvard Business Review, and SmartBrief's SmartBlog on Leadership. Her writing has also been featured on CNN Living and Mamapedia.



Heidi is also Associate Director of the Motivation Science Center at the Columbia University Business School.

Thursday, December 8, 2011

Are Creative People More Dishonest? - HBS Working Knowledge

Research & Ideas


Published: December 7, 2011

Author: Carmen Nobel


In a series of studies, Francesca Gino and Dan Ariely found that inherently creative people tend to cheat more than noncreative people. Furthermore, they showed that inducing creative behavior tends to induce unethical behavior. It's a sobering thought in a corporate culture that champions out-of-the-box thinking. Key concepts include:


•In a series of experiments, the researchers found links between creativity and unethical behavior.

•Inherently creative people tend to cheat more than noncreative types. Furthermore, inducing creative behavior tends to induce unethical behavior.

•Creativity is not necessarily bad, but managers would do well to consider how to structure the creative process to get the good outcomes of creativity without triggering the bad ones.

.In his 1641 treatise, Meditations on First Philosophy, philosopher RenĂ© Descartes introduced the concept of an "evil genius," a powerful force of nature who is equally clever and deceitful. Since then, the world has given us plenty of examples—Hannibal Lecter in The Silence of the Lambs, fictional Wall Street villain Gordon Gekko, and real-life Wall Street villain Bernie Madoff, to name a few. Not only were these classic bad guys unquestionably unethical, but all were inarguably creative in carrying out their bad behavior as well. Indeed, it's rare to hear anyone described as both evil and unoriginal.

This raises a question: Is there a link between creativity and unethical behavior?

"Dan and I started wondering whether there is something about the creative process that triggers dishonest behavior."There certainly is, according to an article in a forthcoming issue of the Journal of Personality and Social Psychology. In "The Dark Side of Creativity: Original Thinkers Can Be More Dishonest," the authors report that inherently creative people tend to cheat more than noncreative types. Furthermore, they show that inducing creative behavior tends to induce unethical behavior.

It's a sobering thought in a corporate culture that champions out-of-the-box thinking.

"In any organization, especially in contexts that are global and very competitive, there is so much focus on trying to be innovative and creative," says Francesca Gino, an associate professor at Harvard Business School, who wrote the article with Dan Ariely of Duke University. "But is creativity always good? We often hear of cases in which people use innovative behavior to create a sense that what they're doing is not morally wrong. So, Dan and I started wondering whether there is something about the creative process that triggers dishonest behavior. Specifically, we decided to explore the idea that enhancing the motivation to think outside the box can drive individuals toward more dishonest decisions when facing ethical dilemmas."

Creativity and ambiguity

To begin their research, Gino and Ariely surveyed 99 employees across 17 departments at an American advertising agency, where some jobs—copywriting, for example—required much more creativity than others. In the anonymous survey, on a seven-point scale, the respondents indicated how likely they were to engage in various ethically questionable work behaviors such as "take home office supplies from work" and "inflate your business expense report." Respondents also evaluated scenarios describing a hypothetical person who has the opportunity to behave dishonestly, and then indicated, again on a seven-point scale, how likely they would be to behave unethically in each instance. Finally, the respondents reported how much creativity was required in their respective jobs, with three managers in the executive office rating the creativity level required in each department, as well.

Overall, the researchers learned, the higher the creativity required for the job, the higher the level of self-reported dishonesty.

Then, through a series of experimental studies, the researchers tested--and largely proved--the theory that creative people are more likely to exhibit unethical behavior when faced with ethical dilemmas.

The first study tested the hypothesis that a naturally creative person is predisposed to dishonest behavior. (The week before the experiment, the participants, 71 university students, completed an online survey that included dispositional measures of creativity.) The experiment included a computerized task in which participants viewed 20 dots inside a diagonally bisected square. They were told to indicate whether there were more dots on the right side of the square or on the left, and that their answers would affect how well they would be compensated for taking part in the experiment: each "more-on-the-right" decision would earn them 10 times as much as a "left" decision.

In half the trials, it was obvious that one side of the square had more dots than the other—2 dots versus 18, for example. But in the other half, the task was a little more ambiguous, with several dots appearing near or on the line in the middle of the square. The researchers focused on the results of the "ambiguous" tasks, with the idea that these were the ones that allowed more room for interpretation—participants could easily misrepresent what they actually perceived and report "more on the right" in order to incur a higher payoff.

The results showed that participants who had scored high on the creativity scale were the most likely to fudge their answers for monetary gain.

"Ambiguity, having some room to justify our behavior, seems to be a really important component of explaining when and why we cross ethical boundaries, and these results show us that creativity helps with that process," Gino says. "It suggests that moral flexibility is the mechanism explaining why being in a creative mindset or being a creative person puts you more at risk to do the wrong thing."

The perils of inducing creativity

In another study, which included 111 university students, the researchers tested whether they could actively induce creativity, and whether doing so would temporarily induce dishonest behavior. Participants were randomly assigned to one of two groups: the "creative mindset" group and the control group. All were asked to construct sentences from sets of randomly positioned words. But in the creative mindset group, more than half of the sentences included words related to creativity: "novel," "imagination," "invention," "originality," and so on.

"We're not saying that creativity's bad, but we are saying that it can lead to problems."To test whether the creativity prime worked, the researchers asked participants to solve a cognitive puzzle created by the Gestalt psychologist Karl Duncker. Known as Duncker's candle problem, it presents participants with the task of affixing a candle to a wall in such a way that when lit, the candle won't drip wax on the floor. To complete the task, participants can use a box of tacks, a book of matches, and the candle. The ideal solution, which requires ingenuity, involves emptying the box, tacking the box to the wall as a candleholder, placing the candle inside, and lighting the candle with the match. The researchers found that 47.3 percent of participants in the creative mindset group solved the candle problem ideally, versus 26.8 percent in the control group.

Next, participants completed a series of computerized tasks, including the ambiguous dots-in-the-square task from the first study. The results showed that those in the creative mindset group were much more likely to give dishonest answers for monetary gain than those in the control group.

"These were simple studies, but they were powerful in showing that our ability to justify things is significantly greater if we are in a creative mindset or when we are creative people," Gino says.

That said, Gino is quick to add that she and Ariely are not suggesting that companies put the kibosh on innovation in order to keep dishonesty at bay.

"We're not saying that creativity is bad," Gino says. "But we are saying that it can lead to problems. And so the question from a manager's perspective is: How do you get the good outcomes of creativity without triggering the bad outcomes?"

While "The Dark Side of Creativity" doesn't answer that question directly, Gino hopes that the research will remind innovative organizations not to give short shrift to ethics.

"As a manager, if you're highlighting the importance of being creative and innovative, it's important to make sure that you're stressing the presence of ethics, too," Gino says. "Dan and I are of the hope that managers will start thinking about how to structure the creative process in such a way that they can keep ethics in check, triggering the good behavior without triggering the bad behavior."

About Faculty in this Article: Francesca Gino
Francesca Gino is an associate professor in the Negotiations, Organizations, and Markets Unit at Harvard Business School


Invitation to participate
Are you a manager at an organization that stresses the importance of creativity in the workplace? Do you have thoughts about how to encourage creativity while discouraging unethical behavior? Please share your thoughts in the comments section below. You can also reach Francesca Gino directly at fgino@hbs.edu or follow her on Twitter, @francescagino.

Access Newsletter And Its Great Content: http://hbswk.hbs.edu/item/6883.html?wknews=12072011

Thursday, November 3, 2011

You don’t have to be a Dupe to be Duped:Lessons from the Madoff Affair - Inside Influence Report

Inside Influence Report [Special Edition]


11/02/2011


About Madoff & 60 Minutes


Because of Sunday’s big 60 Minutes interview with the Madoff family, we’ve received a number of requests to reprise the article written by Dr. Cialdini entitled: You don’t have to be a Dupe to be Duped: Lessons from the Madoff Affair.

These are good lessons for us all. Click here to read Dr. Cialdini’s article. [pasted below]

You don’t have to be a Dupe to be Duped:
Lessons from the Madoff Affair  

By Dr. Robert Cialdini

 
By now, we’ve all been exposed to varied analyses of the highly publicized Ponzi scheme that Wall Street player Bernard Madoff is charged with orchestrating. While some analysts have focused on certain remarkable aspects of the fraud such as its size ($50 billion by most estimates) and its duration (going undetected for decades), I’ve been impressed by another remarkable feature: the level of financial sophistication of many of its victims. The list of those taken in by Madoff is rife with the names of hardheaded economists, seasoned money managers, and highly successful business leaders. With Madoff, it wasn’t another case of the fox outwitting the chickens; this guy bamboozled the other foxes. How’d he do it?

For me, the answer starts with the opaque and complicated nature of the hedge fund he was operating and the derivatives-based financial mechanism he was employing to create profits, which seemed beyond the comprehension of the majority of even the most sophisticated financial analysts. In addition, Madoff elevated the consequent mystery of what he was doing and how he was doing it by enforcing strict policies of secrecy around his business. But why, of all things, should the difficult-to-penetrate character of Madoff’s operation form the basis for his astounding effectiveness at persuading others to join him—especially others who, by virtue of savvy and experience, should have known better?


The Power of Persuasion under Conditions of Uncertainty

Under conditions of uncertainty like those Madoff cultivated, a pair of principles of social influence gain special traction: Authority and Social Proof. Let’s take each in turn and examine how they were commissioned by Madoff to advance his persuasive success.

Authority
When people are uncertain of what to do, they don’t look inside themselves for answers; all they’ll see there is vexing ambiguity. Instead, they look outside. One prominent place they look is to the counsel of experts, credible authorities on the topic. And, by any measure, Bernard Madoff certainly had the look of a credible authority in financial matters. He possessed expert credentials from long years in the investment industry. After starting his firm in 1960, he grew it into a juggernaut that was reported to be the largest dealer in NYSE-listed stocks in the United States. His firm helped to develop the NASDAQ, where he served as Chairman of the Board of Directors and where Madoff Securities became the exchange’s largest market-maker. Beyond expertise, Madoff spent substantial time and money establishing a reputation for possessing the second element of credible authority—trustworthiness. He was active in an organization oriented to the self-regulation of the securities industry, the National Association of Securities Dealers, and even sat on its Board of Governors. Moreover, he was widely known for his good heart via multiple charitable and philanthropic involvements.

Against such a backdrop, we can begin to understand why so many knowledgeable and experienced financial professionals followed Mr. Madoff down the garden path. Under conditions of uncertainty, they did not look inside (to their own knowledge and experience) for direction. They looked outside to credible authorities on the topic. And, there were few on the murky topic of derivative-based hedge funds more credible than Bernie Madoff.
Social Proof

Besides authorities, do people seek any other source of external information when uncertain of how to choose? They do. They look to—and then follow—what most people just like them are doing. Here, the proof of a correct choice isn’t based on knowledge or logic or empirical evidence; it’s based on social evidence of what one’s peers and those in one’s social network have decided to do. For instance, if the evidence were clear that your friends and coworkers were flocking to a new restaurant for lunch, you’d likely follow suit. At developing, honing, and providing this kind of social evidence, the Madoff client recruitment program had few equals. Madoff is Jewish, and so, too, are the majority of his victims, who were often recruited at country clubs by Madoff’s lieutenants, who were also Jewish and also members of the same country clubs. Plus, new recruits knew and were similar to past recruits, who served as unwitting sources of social proof that an investment with Madoff must be a wise choice "for someone like me." Of course, fraud of this sort is hardly limited to one ethnic or religious group. Called affinity schemes, these investment scams have always involved members of a group preying on other members of the group—Baptists on Baptists, Hispanics on Hispanics, Armenian-Americans on Armenian-Americans. Indeed, Charles Ponzi, who gave his name to the infamous Ponzi scheme that Madoff copied, was an Italian immigrant to the U.S. who fleeced other Italian immigrants to the U.S.


Implications for Ethical Influence in Times of Uncertainty (Like Now!!)
What lessons can be gleaned from the Madoff case for those who want to be influential but who refuse to tumble to Mr. Madoff’s ethical level in the process? Honestly informing prospects, customers, clients, superiors, or coworkers of the views of legitimate authorities and/or the choices of comparable others is a both a potent and ethical route to persuasive success. But, to maximize the effect of these two sources of influence, there is one additional aspect to consider: They will have particularly strong impact under conditions of uncertainty, when people are looking outside rather than inside themselves for answers.
This means that when the economic environment has become unpredictable, as is currently the case—or even when business conditions have recently changed for more ordinary reasons, such as a new product introduction or a new organizational policy or the emergence of a new competitor—the resulting uncertainty will make audiences especially attentive and responsive to information about how experts and similar others are dealing with it. It also means that communicators would lose great persuasive leverage (more bluntly, would be fools) if they failed to marshal and honestly employ those two sources of information in their messaging at precisely these times.

Thus, when things are uncertain, the judgments and actions of authorities and of comparable others can provide a goldmine of persuasive resources. And that mine is…well…a terrible thing to waste.


© 2010 INFLUENCE AT WORK ALL RIGHTS RESERVED

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Dr. Robert Cialdini has spent his entire career researching the science of influence earning him an international reputation as an expert in the fields of persuasion, compliance, and negotiation.

His books including, Influence: Science & Practice, are the results of years of study into the reasons why people comply with requests in business settings. Worldwide, Influence has sold over 2 million copies. Influence has been published in twenty-six languages. His most recent co-authored book, Yes! 50 Scientifically Proven Ways to be Persuasive, has been on the New York Times, USA Today & Wall Street Journal Best Seller Lists.

In the field of influence and persuasion, Dr. Cialdini is the most cited living social psychologist in the world today.

Dr. Cialdini received his Ph.D from the University of North Carolina and post doctoral training from Columbia University. He has held Visiting Scholar Appointments at Ohio State University, the University of California, the Annenberg School of Communications, and the Graduate School of Business of Stanford University. Currently, Dr Cialdini is Regents’ Professor Emeritus of Psychology and Marketing at Arizona State University.

Dr. Cialdini is President of INFLUENCE AT WORK, an international consulting, strategic planning and training organization based on the Six Principles of Influence.

Dr. Cialdini’s clients include such organizations as Google, Microsoft, Cisco Systems, Bayer, Coca Cola, KPMG, AstraZeneca, Ericsson, Kodak, Merrill Lynch, Nationwide Insurance, Pfizer, AAA, Northern Trust, IBM, Prudential, The Mayo Clinic, GlaxoSmithKline, Harvard University - Kennedy School, The Weather Channel, the United States Department of Justice, and NATO.
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Access Or Subscribe - Inside Influence Report: http://www.insideinfluence.com/

Wednesday, November 2, 2011

Who You Are - NYTimes.com

Who You Are




Daniel Kahneman spent part of his childhood in Nazi-occupied Paris. Like the other Jews, he had to wear a Star of David on the outside of his clothing. One evening, when he was about 7 years old, he stayed late at a friend’s house, past the 6 p.m. curfew.
He turned his sweater inside out to hide the star and tried to sneak home. A German SS trooper approached him on the street, picked him up and gave him a long, emotional hug. The soldier displayed a photo of his own son, spoke passionately about how much he missed him and gave Kahneman some money as a sentimental present. The whole time Kahneman was terrified that the SS trooper might notice the yellow star peeking out from inside his sweater.

Kahneman finally made it home, convinced that people are complicated and bizarre. He went on to become one of the world’s most influential psychologists and to win the Nobel in economic science.

Kahneman doesn’t actually tell that childhood story in his forthcoming book. “Thinking, Fast and Slow” is an intellectual memoir, not a personal one. The book is, nonetheless, sure to be a major intellectual event (look for an excerpt in The Times Magazine this Sunday) because it superbly encapsulates Kahneman’s research, and the vast tide of work that has been sparked by it.

I’d like to use this column not to summarize the book but to describe why I think Kahneman and his research partner, the late Amos Tversky, will be remembered hundreds of years from now, and how their work helped instigate a cultural shift that is already producing astounding results.

Before Kahneman and Tversky, people who thought about social problems and human behavior tended to assume that we are mostly rational agents. They assumed that people have control over the most important parts of their own thinking. They assumed that people are basically sensible utility-maximizers and that when they depart from reason it’s because some passion like fear or love has distorted their judgment.

Kahneman and Tversky conducted experiments. They proved that actual human behavior often deviates from the old models and that the flaws are not just in the passions but in the machinery of cognition. They demonstrated that people rely on unconscious biases and rules of thumb to navigate the world, for good and ill. Many of these biases have become famous: priming, framing, loss-aversion.

Kahneman reports on some delightful recent illustrations from other researchers. Pro golfers putt more accurately from all distances when putting for par than when putting for birdie because they fear the bogie more than they desire the birdie. Israeli parole boards grant parole to about 35 percent of the prisoners they see, except when they hear a case in the hour just after mealtime. In those cases, they grant parole 65 percent of the time. Shoppers will buy many more cans of soup if you put a sign atop the display that reads “Limit 12 per customer.”

Kahneman and Tversky were not given to broad claims. But the work they and others did led to the reappreciation of several old big ideas:

We are dual process thinkers. We have two interrelated systems running in our heads. One is slow, deliberate and arduous (our conscious reasoning). The other is fast, associative, automatic and supple (our unconscious pattern recognition). There is now a complex debate over the relative strengths and weaknesses of these two systems. In popular terms, think of it as the debate between “Moneyball” (look at the data) and “Blink” (go with your intuition).

We are not blank slates. All humans seem to share similar sets of biases. There is such a thing as universal human nature. The trick is to understand the universals and how tightly or loosely they tie us down.

We are players in a game we don’t understand. Most of our own thinking is below awareness. Fifty years ago, people may have assumed we are captains of our own ships, but, in fact, our behavior is often aroused by context in ways we can’t see. Our biases frequently cause us to want the wrong things. Our perceptions and memories are slippery, especially about our own mental states. Our free will is bounded. We have much less control over ourselves than we thought.

This research yielded a different vision of human nature and a different set of debates. The work of Kahneman and Tversky was a crucial pivot point in the way we see ourselves.

They also figured out ways to navigate around our shortcomings. Kahneman champions the idea of “adversarial collaboration” — when studying something, work with people you disagree with. Tversky had a wise maxim: “Let us take what the terrain gives.” Don’t overreach. Understand what your circumstances are offering.

Many people are exploring the inner wilderness. Kahneman and Tversky are like the Lewis and Clark of the mind.

Thursday, June 9, 2011

47 Mind-Blowing Psychology-Proven Facts You Should Know About Yourself

47 Mind-Blowing Psychology-Proven Facts You Should Know About Yourself

Access Slide Show: http://www.businessinsider.com/100-things-you-should-know-about-people-2010-11


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Note from Jim: Fascinating and useful! - Insights about human behavior with citations of psychological studies. Oriented to tips for electronic communication and web design yet containing lessons for marketing, social interaction, perception, decision making, and influence. 
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Business Insider

Susan Weinschenk, What Makes Them Click


47 Mind-Blowing Psychology-Proven Facts You Should Know About Yourself

Excerpts:
#1 — You Have “Inattention Blindness”

#2 — You READ FASTER With a longer Line Length But PREFER Shorter

#3 — You Can Only Remember 3 to 4 Things At A Time (The Magic Number 3 or 4)

#4 — You Imagine Objects From Above and Tilted (The “Canonical Perspective”)

#5 — You Make Most of Your Decisions Unconsciously

#6 — You Reconstruct Your Memories

#7 — You Actually Can’t Multi-Task

#8 — Dopamine Makes You Addicted To Seeking Information

#9 — Blue and Red Together is Hard On Your Eyes (Chromostereopsis)

#10 — You Want More Choices and Information Than You Can Actually Process

#11 — Why You Can’t Resist Paying Attention to Food, Sex, or Danger

#12 — When it comes to technology, you definitely “act your age”

#13 — Want To Change a Habit? Use Fun, Surprise, and a Crowd

#14 — Reading Text Online Is Not Fun

#15 — If You Use Social Media Without Laughter You Aren’t Being Social

#16 — The Ability To Delay Gratification Or Not Starts Young

#17 — Your Unconscious Knows First

#18 — What People Look At On a Picture Or Screen Depends On What You Say To Them

#19 — It’s a Myth That All Capital Letters Are Inherently Harder to Read

#20 — Your Attention Is Riveted By Pictures Of People

#21 — You Overestimate Your Reactions to Future Events

#22 — Peripheral Vison — Keeping You Alive or Channel Surfing?

#23 — You Are Hard-Wired For Imitation and Empathy

#24 — You Are Most Affected By Brands and Logos When You Are Sad Or Scared

#25 — Trust Your Gut or Be Logical? It Depends On Your Mood

#26 — Culture shapes our brain

#27 — We go below the “fold”

#28 — Things that are close together seem to belong together

#29 – Brand Names Talk To Our “Old” Brains

#30 — Our “strong tie” group size is 150 people

#31 — The Desire For Control And Choice Is Built In

#32 — Synchronous activity bonds the group

#33: Bite-Sized Chunks Of Info Are Best

#34 — Too Much Stress Results In Poor Performance

#35 — People Make Mistakes

#36 — People are Inherently Lazy

#37 — People Assume It’s You, Not The Situation

#38 — Even The Illusion Of Progress Is Motivating

#39 — Your Mind Wanders 30% of the Time

#40 — “You’re Easily Influenced, but I’m not”

#41 — Your Most Vivid Memories Are Wrong

#42 — We’ll spend more money if you don’t mention money

#43 — People Expect Online Interactions to Follow Social Rules

#44 — When Uncertain, People Look To Others to Decide What To Do

#45 — You Choose (And Vote For) The First One On The List

#46: The more uncertain you are, the more you dig in and defend your ideas

#47 — People Value A Product More Highly If It Is Physically In Front Of Them


What else should you know about people? Find out from...


Read more: http://www.businessinsider.com/100-things-you-should-know-about-people-2010-11#what-else-should-you-know-about-people-find-out-from-48#ixzz1OmaFuVHA


Dr. Susan Weinschenk has been applying psychology to the design of technology for 30 years and is the author of Neuro Web Design: What makes them click? and 100 Things Every Designer Needs To Know About People. Susan is Chief of User Experience Strategy, Americas, at Human Factors International, and runs a popular blog: Whatmakesthemclick.net.

You can contact Susan at: Weinschenk@gmail.com or twitter@thebrainlady


Contact:
e-mail:weinschenk@gmail.com


Read more: http://www.businessinsider.com/author/susan-weinschenk#ixzz1OmcGYZMC

Access Slide Show: http://www.businessinsider.com/100-things-you-should-know-about-people-2010-11

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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Tuesday, March 8, 2011

Attunement, Equipoise, Metis, Limerence - David Brooks - The New York Times

David Brooks - The New York Times


Op-Ed Columnist

The New Humanism



Over the course of my career, I’ve covered a number of policy failures. When the Soviet Union fell, we sent in teams of economists, oblivious to the lack of social trust that marred that society. While invading Iraq, the nation’s leaders were unprepared for the cultural complexities of the place and the psychological aftershocks of Saddam’s terror.
David Brooks

David Brooks’s Blog


The intellectual, cultural and scientific findings that land on the columnist’s desk nearly every day.



The Conversation



We had a financial regime based on the notion that bankers are rational creatures who wouldn’t do anything stupid en masse. For the past 30 years we’ve tried many different ways to restructure our educational system — trying big schools and little schools, charters and vouchers — that, for years, skirted the core issue: the relationship between a teacher and a student.

I’ve come to believe that these failures spring from a single failure: reliance on an overly simplistic view of human nature. We have a prevailing view in our society — not only in the policy world, but in many spheres — that we are divided creatures. Reason, which is trustworthy, is separate from the emotions, which are suspect. Society progresses to the extent that reason can suppress the passions.

This has created a distortion in our culture. We emphasize things that are rational and conscious and are inarticulate about the processes down below. We are really good at talking about material things but bad at talking about emotion.

When we raise our kids, we focus on the traits measured by grades and SAT scores. But when it comes to the most important things like character and how to build relationships, we often have nothing to say. Many of our public policies are proposed by experts who are comfortable only with correlations that can be measured, appropriated and quantified, and ignore everything else.

Yet while we are trapped within this amputated view of human nature, a richer and deeper view is coming back into view. It is being brought to us by researchers across an array of diverse fields: neuroscience, psychology, sociology, behavioral economics and so on.

This growing, dispersed body of research reminds us of a few key insights. First, the unconscious parts of the mind are most of the mind, where many of the most impressive feats of thinking take place. Second, emotion is not opposed to reason; our emotions assign value to things and are the basis of reason. Finally, we are not individuals who form relationships. We are social animals, deeply interpenetrated with one another, who emerge out of relationships.

This body of research suggests the French enlightenment view of human nature, which emphasized individualism and reason, was wrong. The British enlightenment, which emphasized social sentiments, was more accurate about who we are. It suggests we are not divided creatures. We don’t only progress as reason dominates the passions. We also thrive as we educate our emotions.

When you synthesize this research, you get different perspectives on everything from business to family to politics. You pay less attention to how people analyze the world but more to how they perceive and organize it in their minds. You pay a bit less attention to individual traits and more to the quality of relationships between people.

You get a different view of, say, human capital. Over the past few decades, we have tended to define human capital in the narrow way, emphasizing I.Q., degrees, and professional skills. Those are all important, obviously, but this research illuminates a range of deeper talents, which span reason and emotion and make a hash of both categories:

Attunement: the ability to enter other minds and learn what they have to offer.

Equipoise: the ability to serenely monitor the movements of one’s own mind and correct for biases and shortcomings.

Metis: the ability to see patterns in the world and derive a gist from complex situations.

Sympathy: the ability to fall into a rhythm with those around you and thrive in groups.

Limerence: This isn’t a talent as much as a motivation. The conscious mind hungers for money and success, but the unconscious mind hungers for those moments of transcendence when the skull line falls away and we are lost in love for another, the challenge of a task or the love of God. Some people seem to experience this drive more powerfully than others.

When Sigmund Freud came up with his view of the unconscious, it had a huge effect on society and literature. Now hundreds of thousands of researchers are coming up with a more accurate view of who we are. Their work is scientific, but it directs our attention toward a new humanism. It’s beginning to show how the emotional and the rational are intertwined.

I suspect their work will have a giant effect on the culture. It’ll change how we see ourselves. Who knows, it may even someday transform the way our policy makers see the world.

__________

This version of this op-ed appeared in print on March 8, 2011, on page A27 of the New York edition.

__________

David Brooks's Op-Ed column in The New York Times started in September 2003. He has been a senior editor at The Weekly Standard, a contributing editor at Newsweek and the Atlantic Monthly, and he is currently a commentator on "The Newshour with Jim Lehrer." He is the author of "Bobos In Paradise: The New Upper Class and How They Got There" and “On Paradise Drive : How We Live Now (And Always Have) in the Future Tense,” both published by Simon & Schuster. His most recent book is “The Social Animal: The Hidden Sources of Love, Character, and Achievement,” published by Random House in March 2011.


Mr. Brooks joined The Weekly Standard at its inception in September 1995, having worked at The Wall Street Journal for the previous nine years. His last post at the Journal was as op-ed editor. Prior to that, he was posted in Brussels, covering Russia, the Middle East, South Africa and European affairs. His first post at the Journal was as editor of the book review section, and he filled in for five months as the Journal's movie critic.

Mr. Brooks graduated from the University of Chicago in 1983, and worked as a police reporter for the City News Bureau, a wire service owned jointly by the Chicago Tribune and Sun Times.

He is also a frequent analyst on NPR’s "All Things Considered" and the "Diane Rehm Show." His articles have appeared in the The New Yorker, The New York Times Magazine, Forbes, the Washington Post, the TLS, Commentary, The Public Interest and many other magazines. He is editor of the anthology "Backward and Upward: The New Conservative Writing" (Vintage Books).

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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Friday, January 7, 2011

Forbes » Contributor Profile » Freek Vermeulen

Forbes » Contributor Profile » Freek Vermeulen


Forbes.com


Freek Vermeulen
Business Exposed


Employee remuneration systems are often based on the wrong assumptions


Jan. 6 2011 - 4:56 am 424 views 0 recommendations 2 comments












Freek Vermeulen - About Me

I am an Associate Professor of Strategic & International Management at the London Business School and author of the book "Business Exposed: The naked truth about what really goes on in the world of business" (FT Prentice Hall)


Read Article/ Access Content Source: http://blogs.forbes.com/people/freekvermeulen/



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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Thursday, December 2, 2010

The Perfect Gift: The Miracles of Pain-Free, Guilt Free Stuff - It's Your Money - TIME.com

How Amazon Gets You to Stop Shopping Anywhere Else - It's Your Money - TIME.com

Time Magazine







The Perfect Gift: The Miracle of Pain-Free, Guilt-Free Stuff





By now, you've probably given some thought to the mysterious concept known as "the perfect gift." You want to give it. You want to receive it. But what exactly makes a gift perfect?

In a WSJ piece, Dan Ariely, a psychology professor at Duke and the author of Predictably Irrational, writes that the perfect gift isn't really about generosity or kindness so much as it's about guilt. That's better than greed, I suppose, though neither tends to come up when thinking about the traditional holiday spirit.

Ariely has been trying to get to the heart of what it is that makes a good gift, and after asking loads of people for input:


One of the best answers I've gotten so far is this: "A good gift is something that someone really wants but feels guilty buying for themselves." This perspective is interesting because it suggests that the ideal gift is not something that the recipient can't afford or didn't know she wanted. It all comes down to alleviating guilt.

Santa, it turns out, spreads joy by spoiling people so that they don't feel bad about spoiling themselves.

Ariely explains how this works, using the example of a shopper who eyes a coat in a store window and wants it badly, but, after seeing the price tag and thinking it over, ultimately doesn't buy it because it's double what the shopper is willing to pay. To sum up, the shopper deliberated and concluded that this item wasn't worth the money. But, Ariely writes:


When you get home, however, you find out that your significant other has bought you that same exact coat…using money from your joint checking account. Would you say, "Honey, this is very nice of you, but I have already weighed the costs and benefits and decided that this coat is not worth the money, so please take it back immediately"? Or would you say, "Thank you so much, I love it!" I suspect that the answer is the latter. Your significant other got you what you wanted without making you contemplate the guilt associated with the purchase.

My take is that this little head game goes deeper than merely alleviating guilt. As mentioned, the shopper had already decided the coat wasn't worth the money. Or is it that the shopper decided that he or she wasn't worthy of the coat at that price? If the latter enters the shopper's mind even at the subconscious level, then having someone else give the shopper the coat sends a message, with the giver implicitly saying: You might not think you're worthy of this coat, but I do.

From the child's mindset, miracles happen every Christmas morning, with perfect, impossibly out-of-reach gifts arriving magically under the tree, with no pesky consequences or credit card bills to speak of. Likewise, the perfect gift for an adult also makes a miracle happen: The recipient is made to feel worthy of something that he'd previously decided he was unworthy of. The money spent in the transaction is easily overlooked, even if the recipient previously concluded that the item was far overpriced, and even if the money comes out of the recipient's own bank account.

Back to the guilt factor: What's key to the recipient enjoying a gift seems to be the idea that there are no consequences. It's all joy, it's magic. This is absurd, of course—somebody has to pay the bill!—but it's a little mind game givers, or at least givees, play. Consumers want pure enjoyment, without pain, without guilt, and without much thought. This is hard to achieve when you're spending your own cash, though it's much easier when you're using plastic, which is why credit cards are such enablers, allowing consumers to spend thoughtlessly and in a way that seems much less tangible and painful than using greenbacks.

Even better, of course, is having someone else give you something. What's funny is that, even though cash is the absolute best gift—what else gives the recipient more freedom?—givers are hesitant to hand over greenbacks because it seems crass, and many recipients apparently don't like cash either. Why? Once you have that cash in hand, it becomes painful to part with it.

For some reason, gift cards, however, which are often marketed for being just as good as cash (only they're not cash), are thought of in a much more positive light by givers and getters alike. Now why is it that a gift whose main attribute is that it's just like cash is perceived as superior to cash?

For recipients, it's gotta be the pain factor. Or the lack thereof when using a gift card, which works just like cash, and is even less painful than swiping a credit card. As Ariely writes:


That's why gift certificates for dinner, drinks, iTunes, movies and so on are so popular. They not only encourage people to experience something new, they let them experience it without any psychological burdens or the pain of paying.

And without any pain or much of any thought, consumers do really stupid things. It's been shown that consumers using gift cards—who feel like they're not paying anything—are more likely to spend foolishly, and on stuff they don't need or won't want in the long run. One study shows that gift card users are 2.5 times more likely to pay full price than consumers who are really paying for their purchases.

Despite this, and despite the recent fact that surfaced revealing that 27% of American consumers still have gift cards received last holiday season that they haven't yet used, guess what the #1 requested gift is in surveys, for the fourth year running? Yep, according to the National Retail Federation, the answer is: the gift card.

Gift cards are on the top of consumer wish lists, and Americans are expected to spend more on them this year, an average of $145.61, up from $139.91 last year. Nearly 80% of shoppers will buy at least one gift card during the holiday season, and the average amount on each card is $41.48, up from $39.80 in 2009.

And what is this all about? Spreading joy by way of removing pain and guilt. For the person who has everything—including too much pain and guilt—I suppose this has the makings of a pretty good gift.





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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Saturday, November 27, 2010

The Guilty Secret to Giving the Best Gifts - WSJ.com

The Guilty Secret to Giving the Best Gifts - WSJ.com


Excerpts:

What these principles tell us is that the best gifts circumvent guilt in two key ways. [1] They eliminate the guilt that accompanies extravagant purchases, and [2] they reduce the guilt that comes from coupling payment with consumption. That's why gift certificates for dinner, drinks, iTunes, movies and so on are so popular. They not only encourage people to experience something new, they let them experience it without any psychological burdens or the pain of paying.

—Dan Ariely is a professor of psychology and behavioral economics at Duke University. His most recent book is "The Upside of Irrationality."





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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Monday, September 13, 2010

[ Lessons for Interviewing & Dating ] Where the Free Market Fails: Online Dating - Dan Ariely - Research - Harvard Business Review

Where the Free Market Fails: Online Dating - Dan Ariely - Research - Harvard Business Review

[ Lessons for Interviewing & Dating ]

Where the Free Market Fails: Online Dating




In economics, there's a concept called bad equilibrium. It's a strategy that all the players in the game can adopt and converge on, but it won't produce a desirable outcome for anyone. We decided to research this problem in the context of online dating, a prototypically perfect lab full of bad equilibrium.

First dates are all about strategies that both parties can agree to but which won't help them learn if the date was effective. Think of a first date: We try to express ourselves and learn about the other person, but not express ourselves too much or offend by being intrusive. We default to friendly over controversial, even at the risk of sounding dull. "We have so much in common," says one character in the movie Best in Show, exemplifying what first-date strategies yield. "We both love soup and snow peas, we love the outdoors, and talking and not talking. We could not talk or talk forever and still find things to not talk about."

It's easy to talk about our views on the weather or food. But while that may guarantee that we don't fail on this date, it does nothing to get us closer to success, as it provides us little useful information on whether we are a long-term romantic match.

In our research, we picked apart what we were hoping would be the juicy details of first introductions between potential matches. But what we found was a whole lot of bad equilibrium. Text analysis supported the idea that people like to maintain boring equilibrium at all costs. Whatever interesting things they may have had to say, they didn't say them, and instead presented themselves as utterly insipid in their written conversations. The dialogue was boring, consisting mainly of questions like:

  • Where did you go to college?
  • What are your hobbies?
  • What is your line of work?

We sensed a compulsion to avoid rocking the boat, and so we decided to push these hesitant daters overboard. So with a certain group of daters who agreed to the experiment, we limited the type of discussions that online daters could engage in. We literally stripped them of the right to ask anything they wanted to and assigned them a list from which they could select questions to ask.

The questions we chose had nothing to do with the how many siblings someone might have or if their favorite show was Mad Men. Instead, we made sure all of the questions were personally revealing, like:
  • How many romantic partners have you had?
  • When was your last breakup?
  • Do you have any STDs?
  • Have you ever broken someone's heart?
  • How do you feel about abortion?

How about those ice breakers!

What we did, essentially, is rig the market by imposing an artificial risk level that would help prevent a bad equilibrium. Daters had no choice but to ask questions generally considered "out of bounds" for a first date.

And their partners responded in kind, creating much livelier conversations than we had seen when daters came up with their own questions. Instead of talking about the World Cup or their favorite pie, they shared deeply felt fears or told the story of losing their virginity. Both senders and repliers reported that they were happier with the interaction.

We believe that restricting the market in such ways can get people to gravitate toward behaviors that are produce better results for everyone. (Remember, in dating, learning sooner that you're not compatible is a better result than wasting time being polite to each other.) More generally, this research suggests that some restricted marketplaces can yield more desirable outcomes. Maybe you can use this idea to energize your next meeting. Create questions that people must address, or topics that aren't allowed to help avoid bad equilibrium.

By forcing people to step out of their comfort zone, risk tipping the relationship equilibria, we might ultimately gain more than if we just fall back on those tropes that are safe for everyone, and useful to no one.





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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Monday, August 9, 2010

Beautiful women face discrimination in certain jobs, study finds

Beautiful women face discrimination in certain jobs, study finds


Science Daily



Science News



Beautiful Women Face Discrimination in Certain Jobs, Study Finds


ScienceDaily (Aug. 7, 2010) — While many see no downside to being beautiful, a professor at the University of Colorado Denver Business School says attractive women face discrimination when it comes to landing certain kinds of jobs.





Journal of Social Psychology, Stefanie Johnson, assistant professor of management at UC Denver Business School, found that beauty has an ugly side, at least for women.

Attractive women were discriminated against when applying for jobs considered "masculine" and for which appearance was not seen as important to the job. Such positions included job titles like manager of research and development, director of finance, mechanical engineer and construction supervisor.

"In these professions being attractive was highly detrimental to women," said Johnson. "In every other kind of job, attractive women were preferred. This wasn't the case with men which shows that there is still a double standard when it comes to gender."

The study, co-authored by Robert Dipboye, professor of psychology at the University of Central Florida, Kenneth Podratz, an organizational development manager at UPS and Ellie Gibbons, research assistant at the University of Colorado Anschutz Medical Campus, found that attractive men suffered no similar discrimination and were always at an advantage.

According to Johnson, beautiful people still enjoy a significant edge. They tend to get higher salaries, better performance evaluations, higher levels of admission to college, better voter ratings when running for public office and more favorable judgments in trials.

A recent Newsweek survey of 202 hiring managers and 964 members of the public concluded that looks matter in every aspect of the workplace and they mattered more for women. When asked to rate nine character attributes on a scale of one to 10 with 10 being the most important, looks ranked third, above education and sense of humor, the magazine reported.

But in one narrow aspect of life, beauty can be a hindrance, something researchers have called the "beauty is beastly" effect.

"In two studies, we found that attractiveness is beneficial for men and women applying for most jobs, in terms of ratings of employment suitability," according to the study. "However, attractiveness was more beneficial for women applying for feminine sex-typed jobs than masculine sex-typed jobs."

In one experiment, participants were given a list of jobs and photos of applicants and told to sort them according to their suitability for the job. They had a stack of 55 male and 55 female photos.

In job categories like director of security, hardware salesperson, prison guard and tow truck driver, attractive women were overlooked. In each of these jobs appearance was perceived to be unimportant. Attractive women tended to be sorted into positions like receptionist or secretary.

"One could argue that, under certain conditions, physical appearance may be a legitimate basis for hiring," Johnson said. "In jobs involving face-to-face client contact, such as sales, more physically attractive applicants could conceivably perform better than those who are less attractive. However it is important that if physical attractiveness is weighed equally for men and women to avoid discrimination against women."

The study chided those who let stereotypes influence hiring decisions. Given the importance of hiring and the consequences of making a wrong choice, the authors said, managers need to rely more on information from the individual rather than on stereotypes about physical appearance.






Story Source:


The above story is reprinted (with editorial adaptations by ScienceDaily staff) from materials provided by University of Colorado Denver, via EurekAlert!, a service of AAAS.





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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Thursday, July 8, 2010

Eat, Greet, and Be Happy

Eat, Greet, and Be Happy

Gallop Management Journal

01 July 2010

Eat, Greet, and Be Happy

The connections between health, community, and wellbeing

A GMJ Q&A with Tom Rath and Jim Harter, authors of Wellbeing: The Five Essential Elements
Page: 123

The information on the FDA's nutrition labels is lacking. Sure, it will tell you about the calories and sodium in a package of microwave cheeseburgers. But it won't mention how a cheeseburger will make you feel in two hours, or if it will bankrupt your imagination this afternoon, or if it will make you too tired to go on a walk this evening -- and it might do all of those things.

What we eat plays a big part in our wellbeing, even our extremely near-term wellbeing, say Tom Rath, author of the bestsellers StrengthsFinder 2.0, Strengths Based Leadership, and How Full Is Your Bucket? and leader of Gallup's workplace research and leadership consulting worldwide, and Jim Harter, Ph.D., Gallup's chief scientist for workplace management and wellbeing and coauthor of the bestseller 12: The Elements of Great Managing.

Manage around yourself. Make it easier to do things that increase your wellbeing before you have to make a choice.

endquote

"Much of what we think will improve our wellbeing is either misguided or just plain wrong" write Rath and Harter in their new book Wellbeing: The Five Essential Elements. Most of us think wellbeing equals health and wealth. But, after a thorough review of hundreds of studies of wellbeing and a comprehensive global study of wellbeing in more than 150 countries, Rath and Harter realized that view is inaccurate. It also completely neglects the impact of lunch.

What does create a life well-lived is wellbeing in five interconnected areas: [1] Career Wellbeing, [2] Social Wellbeing, [3] Financial Wellbeing, [4] Physical Wellbeing, and [5] Community Wellbeing. Those are pretty broad topics, but as Rath and Harter discuss in the book, each of them is created by small decisions.

The decisions we make each day -- large and small -- affect our day-to-day Physical Wellbeing and our integration into our community. And they make a significant -- and largely unrecognized -- difference in our lives.

In this interview, the third in a three-part series, Rath and Harter discuss their research into lifelong wellbeing, particularly Physical Wellbeing and Community Wellbeing. They explain how little things can change your day and alter your perceptions. They discuss why community matters so much and how we can boost our wellbeing. But first, they mention how to avoid that cheeseburger.

GMJ: What's the best way to improve our levels of wellbeing, especially Physical Wellbeing, which obesity rates would indicate isn't as good as it could be?

Tom Rath: I'd say manage around yourself. Make it easier to do things that increase your wellbeing before you have to make a choice because a lot of our choices, though they seem small in the moment, have a big effect.Wellbeing: The Five Essential Elements

Jim Harter, Ph.D.: I think technology can help with this. You can sign yourself up to have money automatically withdrawn from your checking account and put into savings. That's good for your Financial Wellbeing, and you don't feel the pain of writing a check.

That's one of the central points about wellbeing -- what you set up in advance will affect your behavior in the future. In behavioral economics, it's called a "positive default." From a health standpoint, the positive default might be what you put in your refrigerator. If you've only got healthy stuff in there, you are much more likely to eat healthier food. There also are great studies of organ donation -- they show that if people have to opt out of the program versus opting in, many more people would donate their organs.

Rath: Positive defaults align our short-term decisions with our long-term interests. And we don't always do that. When we ask people how often they buy candy, only 10% say they regularly do. But then if you ask them if there was a bowl of candy sitting in front of them if they would eat some, 70% say they would. What we've learned is that if you can make the right decision in the supermarket aisle, it's a heck of a lot easier to make a good decision when you reach in your cupboard when you're craving a snack at eight o'clock at night. Positive defaults protect you from yourself -- and that helps you to make decisions in the moment that are better for your long-term interests.

GMJ: You mention food quite a bit in this book. Why is that?

Rath: What's interesting to me, as we started to dig into the research about Physical Wellbeing, is that food has more of an impact on our energy and mood on a daily basis than I would have guessed. So if I order a cheeseburger and fries for lunch today, and especially if I add a milkshake, I won't get much done at work this afternoon. I'll be a little sleepier, I won't have as many good ideas, and I'm much less likely to go out and exercise or socialize after work. A bad meal can have a detrimental impact on the rest of the day, not just my health or weight a decade later.

Community Wellbeing starts with something very basic: safety. You need to feel safe where you live.

endquote

The same principle applies to exercise. We cite some research in the book that found if you work out for at least 20 minutes in the morning, you can boost your mood for three to twelve hours. So you should work out in the morning because it's a way to have a better day, not just because it'll decrease your blood pressure a few years later. And you're more likely to have a good time after work -- socializing with friends and family and playing around with the kids -- if you exercise. You'll have more energy, which is such a big component of each day. Your mood will be better, and that will increase your likelihood of doing other things that are good for you as well.

Dr. Harter: That's an important point about wellbeing. We don't align our near-term decisions with our long-term best interests because it's hard to think ten, twenty, or thirty years out. But much of what's good for you decades from now is good for you this afternoon. The more you know about that, the easier it is to improve your day-to-day wellbeing and your future wellbeing. For instance, you might join a community group to make your kids' local park better, which is a short-term improvement. But there are many long-term benefits associated with community involvement.

GMJ: Let's talk about that. How do you define Community Wellbeing?

Dr. Harter: What "community" means depends on how each person defines it, where they live, the people around them, the people and places they interact with on a regular basis. There are several parts to Community Wellbeing.[A] It starts with something very basic: safety. You need to feel safe where you live. [B] Then, there's pride in your community -- in its aesthetics and amenities, which includes how things look as well as its parks, trails, and playgrounds. [C] Social offerings are important, which also supports the Social Wellbeing element. And [D]housing comes into it -- whether people feel they have ideal housing for their family. But the highest level of Community Wellbeing is [E] involvement. We found the highest levels of Community Wellbeing where people are actively involved in making a difference and getting recognition for making a difference.

The most interesting thing about Community Wellbeing to me was that it is the differentiator between a good life and a great life. Your wellbeing will be higher if you place higher importance on your involvement in your community. And this is the least recognized dimension -- many people don't even know their neighbors.

GMJ: How do you recommend involving yourself in the community to improve your wellbeing?

Rath: I interviewed some people who had real thriving Community Wellbeing, and I asked them just that. They said they used their own personal passion, the topics they cared about most in life, to connect to their community. Whether it was poverty or autism or Alzheimer's, they used their passion as a way to get involved. That involvement can start small by signing up for one event, and that eventually gets you more and more involved.

Dr. Harter: Many times, it feels like a nuisance to have to get involved in community enterprises. But when you do get involved, it pays off in many ways. You get to know people you otherwise wouldn't have, and you feel better afterward; there are a lot of intangible benefits.

Signing up creates expectations, and you will feel like you have to live up to them later whether you want to that day or not. So think about the things you're passionate about, the areas where you feel you could make a difference, which varies considerably from person to person. People with high Community Wellbeing will sign up for things they are passionate about, and it pays off.

Regardless of your race, age, or whatever it might be, you don't want to feel discriminated against; you want to feel accepted.

endquote

Rath: The encouraging thing is that when you look across different activities people get involved in, we essentially do get when we give, whether it's right at that moment or over time. That was one of our big learnings as we looked at the high end of Community Wellbeing. If you're doing well in other areas of wellbeing, a high level of Community Wellbeing might be what differentiates a good life from one that's excellent. One of the questions we asked in our research is "Have you been recognized for your contributions to the community in the last 12 months?" That's a pretty high bar to set, but it differentiates people who have the very highest levels of wellbeing.

GMJ: So what makes a good community?

Rath: Another question we asked in our research was "Is the community or place where you live the perfect place for you?" We ask it this way because community is about what fits you and your personality and your needs. We interviewed people with thriving Community Wellbeing who lived on an acreage up in the mountains. Others gained just as much satisfaction from living in the thick of an urban environment. The place where you live geographically isn't as big of an issue in terms of your overall Community Wellbeing as it is in terms of how it fits who you are and your involvement.

Dr. Harter: Regardless of who you are, your community needs to be a place that fits you. Regardless of your race, age, or whatever it might be, your community needs to offer things that you want to do. You don't want to feel discriminated against; you want to feel accepted. And it is important for people to have the opportunity to connect with others. Research is showing that change happens, in part, through social networks and social expectations.

Rath: I'm intrigued by Jim's point about social change because I think that's the way much of the improvement in wellbeing will be driven -- through organizations and community groups. Big social changes occur virally, from one group and one network to the next, and they start to spread.

That's been one of the most positive aspects for me about the research for this book -- learning how changes in wellbeing occur and how lives improve from it. We hope the book causes that kind of positive change in wellbeing for readers.

Dr. Harter: That's why we wrote it. All the research, all the science doesn't do any good unless it does some good.

GMJ: Well, I'm definitely ordering a salad for lunch.

Rath: That's a good start.

-- Interviewed by Jennifer Robison

The Five Essential Elements of Wellbeing

For For more than 50 years, Gallup scientists have been exploring the demands of a life well-lived. More recently, in partnership with leading economists, psychologists, and other acclaimed scientists, Gallup has uncovered the common elements of wellbeing that transcend countries and cultures. This research revealed the universal elements of wellbeing that differentiate a thriving life from one spent suffering. They represent five broad categories that are essential to most people:


- Career Wellbeing: how you occupy your time -- or simply liking what you do every day


- Social Wellbeing: having strong relationships and love in your life


- Financial Wellbeing: effectively managing your economic life


- Physical Wellbeing: having good health and enough energy to get things done on a daily basis

- Community Wellbeing: the sense of engagement you have with the area where you live

pinEdit Evaluation 5.0.0701


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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.

Friday, June 4, 2010

Dan Ariely: The Upside of Irrationality and Revenge

Dan Ariely: The Upside of Irrationality and Revenge



Huffington Post

Dan Ariely

Posted: June 3, 2010 04:49 PM

To begin to understand how deeply the human desire for vengeance runs, I invite you to consider a study conducted by a group of Swiss researchers led by Ernst Fehr, who examined revenge using a version of an experimental game we call the Trust Game. Here are the rules, which are explained in detail to all participants.

You are paired with another participant. You are kept in separate rooms, and you will never know each other's identity. The experimenter gives each of you $10. You get to make the first move. You must decide whether to send your money over to the other participant or keep it for yourself. If you keep it, both of you get to keep your $10 and the game is over. However, if you send the other player your money, the experimenter quadruples the amount -- so that the other player has their original $10 plus $40 (the $10 multiplied by four). The other player now has a choice: (a) to keep all the money, which means that they would get $50 and you would get nothing; or (b) to send half the money back to you, which means that each of you would end up with $25.*

The question, of course, is whether you will trust the other person. Do you send them the money -- potentially sacrificing your financial gain? And will the other person justify your trust and share the earnings with you? The prediction of rational economics is very simple: no one would ever give back half of their $50, and, since this behavior is so glaringly predictable from a rational economic perspective, no one would ever send over their $10 in the first place. In this case, the simple economic theory is inaccurate: the good news is that people are more trusting and more reciprocating than rational economics would have us believe. Many people end up passing along their $10, and their partners often reciprocate by sending $25 back.

This is the basic trust game, but the Swiss version included another interesting step: if your partner chooses to keep all $50 for himself, you can use your own money to punish the bastard. For each dollar of your own hard-earned money that you give the experimenter, $2 will be extracted from your greedy partner. This means that if you decide to spend, say, $2 of your own money, your partner will lose $4, and if you decide to spend $25, your partner will lose all his winnings. If you were playing the game and the other person betrayed your trust, would you choose this costly revenge? Would you sacrifice your own money to make the other player suffer? How much would you spend?

The experiment showed that many of the people who had the opportunity to exact revenge on their partners did so, and they punished severely. Yet this finding was not the most interesting part of the study. While making their decisions, the participants' brains were being scanned by positron emission tomography (PET). This way, the experimenters could observe participants' brain activity while they were making their decisions. The results showed increased activity in the striatum, which is a part of the brain associated with the way we experience reward. In other words, according to the PET scan, it looked as though the decision to punish others was related to a feeling of pleasure. What's more, those who had a high level of striatum activation punished others to a greater degree.

All of this suggests that punishing betrayal, even when it costs us something, has biological underpinnings. And this behavior is, in fact, pleasurable (or at least elicits a reaction similar to pleasure).

Not surprisingly, the desire for revenge struck many a citizen in the wake of the financial meltdown of 2008. As a result of the collapse of the mortgage-backed securities market, institutional banks fell like dominoes. In May 2008, JPMorgan Chase acquired Bear Stearns. On September 7, the government stepped in to rescue Fannie Mae and Freddie Mac. A week later, on September 14, Merrill Lynch was sold to Bank of America. The following day, Lehman Brothers filed for bankruptcy. The day after that (September 16), the U.S. Federal Reserve loaned money to AIG to prevent the company's collapse. On September 25, Washington Mutual's banking subsidiaries were partially sold to JPMorgan Chase, and the following day, Washington Mutual's holding company and remaining subsidiary filed for Chapter 11 bankruptcy.

On Monday, September 29, Congress voted against the bailout package proposed by President George W. Bush, resulting in a 778-point drop in the Dow Jones Industrial Average. And while the government worked to build a package that would pass, Wachovia became another casualty as it entered talks with Citigroup and Wells Fargo (the latter bought the bank on October 3).

When I looked around at the outraged public reaction to the $700 billion-plus bank bailout plan, it seemed as if people really wanted to bust the chops of the bankers who had flushed their portfolios down the toilet. One nearly apoplectic friend of mine promoted the idea of an old-fashioned solution: "Instead of taxing us to bail out those crooks," he ranted, "Congress should put them in wooden stocks, with their feet and hands and heads sticking out. I bet everyone in America would give big bucks for the joy of throwing rotten tomatoes at them!"

Now consider what transpired from the perspective of the trust game. We entrusted those bankers with our retirement funds, our savings, and our mortgages. Essentially, they walked away with the $50 (you may want to put a few zeroes behind that). As a consequence, we felt betrayed and angry, and we wanted the bankers to pay dearly. To set the economy right, the world's central banks tried to infuse money into the system, give short-term loans to banks, increase liquidity, buy back mortgage-backed securities, and every other trick in the book. But these extreme measures did not achieve the desired effect in terms of economic recovery, especially if you consider the relatively pitiful impact that the massive injection of money actually had on restoring the economy.** The public remained livid, because the central issue of rebuilding trust was neglected. In fact, I suspect that the public trust was further eroded by three things: the version of the bailout legislation that eventually passed (which involved multiple unrelated tax cuts); the outrageous bonuses paid to people in the financial industry; and the back-to-business-as-usual attitude on Wall Street.

Now just imagine, that instead of assuming that people are perfectly rational, we realized how important trust it, and how it can be easily turned into revenge.

*There are many different versions of this game, with different rules and different amounts of money, but the basic principle is the same.

*** The bailout did help many banks, which quickly returned to profitability and proceeded to pass out large bonuses to their top management. It didn't do as much for the economy.

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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.