The research is federally funded by the National Science Foundation's Human and Social Dynamics program (http://www.nsf.gov).
What happens in our brain when we think about potentially losing money? Some of the same areas that get turned on when we think about winning money get turned off when we think about losing money.
A surprising finding is that as the amount of a potential loss increases, the parts of the brain that process fear or anxiety, such as the amygdala or the insula, are not activated.
"What we found instead," Poldrack said, "is you don't turn anything up. You turn down the reward areas of the brain, and you turn them down more strongly for losses than you turn them up for gains. Just as people respond more strongly to a $100 potential loss than a $100 potential gain, the brain responds more strongly to a $100 potential loss versus a $100 potential gain."
Fox, a behavioral decision theorist, said the study confirms previous research showing that people are more turned off by losses than they are turned on by gains and it provides, for the first time, neural evidence to support this pattern.
"We found for the first time that the neural response to potential losses is larger than the neural response to potential gains," Fox said.
Poldrack and Fox said they are both comfortable with risk in their lives, declining, for example, to buy insurance when they rent cars and declining to buy extended warranties for products.
When Fox was an undergraduate at the University of California, Berkeley, his faculty mentor was Daniel Kahneman, who later won the 2002 Nobel Memorial Prize in Economic Sciences. A key principle from Kahneman's seminal prospect theory, which describes how individuals evaluate losses and gains, is loss aversion: When people consider future actions, they are more sensitive to potential losses than to potential gains. Most people are about
'"/>
Source:University of California - Los Angeles