Is Risk-Taking Contagious?

I tend to take risks.  Speak up (loudly) about not getting paid for an assignment.  When my son has a teacher who loses his test, then yells at him because she can't find it.  When my late mother-in-law insisted I wear a dress that made me look like a beached whale to her grandson's bar mitzvah (not).

On the other hand, my husband is super-cautious.  Won't send it back when a server mistakenly places the wrong order in front of him.   Panics when a patient leaves a message (he's a dentist) and says it's urgent. Refused to get married for years because of his fear of divorce (we've been married for 22).

Now a new study is asking, is risk contagious?

In my house, not so much.

In the study, 24 volunteers repeatedly participated in three types of trials: a "self" trial, in which the participants were asked to choose between taking a guaranteed $10 or making a risky gamble with a potentially higher payoff; an "observe" trial, in which the participants observed the risk-taking behavior of a peer (in the trial, this meant a computer algorithm trained to behave like a peer), allowing the participants to learn how often the peer takes a risk; and a "predict" trial, in which the participants were asked to predict the risk-taking tendencies of an observed peer, earning a cash prize for a correct prediction.

What researchers found was that the participants were much more likely to take the gamble for more money in the "self" trial when they had previously observed a risk-taking peer in the "observe" trial. They noticed that after the subjects observed the actions of a peer, their preferences for risk-taking or risk-averse behaviors began to reflect those of the observed peer—a so-called contagion effect. "By observing others behaving in a risk-seeking or risk-averse fashion, we become in turn more or less prone to risky behavior," says Shinsuke Suzuki, a postdoctoral scholar in neuroscience at the Caltech Brain Imaging Center, and first author of the study.

The team figured this out through magnetic resonance scanning of participants' brains.

A riskier gamble resulted in a higher level of observed activity in a part of the brain, while a less risky gamble resulted in a lower level of activity. The more likely participants were to make a gamble, the more sensitively activity in this part of the brain responded to risk. "This showed that, in addition to the behavioral shift, the neural processing of risk in the part of the brain that responds to it is also altered. Interestingly, both the behavioral and neural responses to taking risks can be changed through passively observing the behavior of others," Suzuki says at newswise.com.

 So is risk-taking contagious? 

"Our findings provide insight into how observation of others' risky behavior affects our own attitude toward risk," Suzuki says—which might help explain the susceptibility of people to risky behavior when observing others behaving in a risky manner, such as in adolescent peer groups. In addition, the findings might offer insight into the formation and collapse of financial bubbles. "The tendency of financial markets to collectively veer from bull markets to bear markets and back again could arise, in part, due to the contagion of observing the risk-seeking or risk-averse investment behaviors of other market participants," he says.

I guess the answer is, it can be.  Just not in my house.











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