The Impact of Luck and Superstition in Decision Making

Implications of the "Positive Effect"

Getting lucky is always a sure shot way of momentary happiness. When something lucky happens, there is almost certainly a positive surge of emotion felt. However, the answer this paper is seeking is whether any studies have considered the implications of this positive feeling? And how big marketing strategies and retail corporations continue to use this as incentive to make the end customer shell out more money. The implied positive affect has significant implications to subsequent decisions and this white paper is a means to clear the ambiguous nature of results that are borne out of decisions made as a consequence.

Consequently, it is also unclear whether people are more likely to choose risky outcomes because the positive affect influences their estimation of the risk involved or if there is a change in perception of how lucky they feel they are. In fact, this underlying cognitive mechanism of momentary happiness is a direct consequence of being lucky.

Researchers have suggested that "good luck and good mood often co-occur" [20] and that lucky people are "happy and optimistic" while unlucky people feel "anxious and depressed" [21]. Thus, increasing the accessibility of luck could elicit positive affect that could consequently influence the perception of risk ([22], [23]) and the possibility of increased risk taking. It could also imply that the impacts on risk-taking that were observed in several studies could have nothing to do with luck and might actually be mediated by the positive affect. Delving further to understand the manipulation of luck (e.g., a previous win or loss, exposure to a lucky or unlucky number) that is elicited by the positive affect, it could influence risk taking behavior in several ways. For example, in [23] results find that people have a tendency to take more risks if they are "feeling happy and the risks are small", which suggests that positive affect biases the estimation of risks and specifically the evaluation of losses and gains, and the increased risk-taking occurs because facts are interpreted in a biased manner. [24] offers a different perspective for the same line of thought. Based on the conceptualization, the experience of the positive affect can be "misattributed to the object being judged".

Upon faced with a choice that has risks associated with it (e.g., "Should I buy this lottery ticket?"), individuals ask themselves how they feel and come up with optimistic responses. [25] suggests that happy people have a tendency to be "unrealistically optimistic" extending further credibility to the idea that a positive affect does exist and conclusively biases estimations of risky outcomes. This affect could extend its influence by changing the weight that people attach to information. For example, people who have just won something and are feeling happy could weigh information that is positive (aspects about the win) more heavily while making future judgments and decisions [26]. When risks are small, people that experience the positive affect might be more likely to take these risks [23] and use the affect as affirmation and extends to making them feel more optimistic about the outcomes of the decisions they have to make. In [27] the author describes that people portray two general motivational factors. One, a "promotion focus", which is highlighted by an emphasis on "hopes and aspirations" and is therefore, a focus on the positive consequences of an individual's behavior.

The other is a "prevention focus", which emphasizes a concern towards "duties, responsibilities, and obligations" that focuses on the avoidance of negative behavioral outcomes. A clear indication of this difference is that individuals with a promotion focus typically frame "positive and negative outcomes in terms of gains (positive) and non-gains (neutral)", respectively, whereas those with a prevention focus frame them in terms of "non-losses (neutral) and losses (negative)", respectively. If being lucky is considered the desired state, then you could expect that people who are considerably more promotion focused would be motivated to incorporate change in their lives or be tolerant of such changes when primed with luck. Experiments in [28] showed that people who had been primed with good luck not only overestimated their probability of winning but were also more likely to participate in lotteries and choose riskier financial options for investments. People experiencing the positive affect after a win, might be more likely to take small risks but less likely to take big risks. However, those that feel temporarily lucky, might decide to take risks regardless of the magnitude of the risk [28].

Conclusion

People are in fact actively purchasing lucky numbers. True, luckiness is an intangible concept? and a lucky number might be valued in part because individuals derive utility from them. The key learnings from the conducted white paper research offers the following takeaways: -Paying for something that yields utility, regardless of what productive or tangible value one might receive, is not an irrational action. - A buyer may also consider a lucky unit number important because he would feel happier, and thus experience less stress and improved health. In that case, intangible luckiness would be providing a very tangible benefit. Consequently, the happiness aroused by feeling lucky and the positive affect induced biases the estimation of risks i.e., the evaluation of gains and losses and might a person that is feeling temporarily lucky to take risks regardless of the magnitude of the risk. Contrary to layman's intuition, the objectivity/subjectivity of luckiness' value, and the tangible or intangible benefits it provides, do not necessarily make a decision to pay for it rational or irrational.

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