In: Accounting
QUESTION 1- An executive experiences indecision after brain surgery, even though his intellect is intact, but his emotions have changed. What role do emotions play in decision making?
Role of emotion in decision making, Various research has been
conducted on the impacts of emotion on decision-making. Studies
indicate the complexity and breadth of those impacts.
His behavior had changed due to brain surgery, his intellect is
intact, but its lead to change his behavior, somehow his emotions
was changed.
Decision-makers who were made to consider safety concerns that
induced negative emotions.
Study participants who experienced "frustrated anger" were more
likely to choose a high risk,
"Fearful people made pessimistic judgments of future events whereas
angry people made optimistic judgements."
Study participants who had been induced to feel sad were likely to
set a lower selling price for an item they were asked to sell; the
researchers suggest that selling the item would bring about a
change in the participants’ circumstances and thus perhaps a
positive change in emotion.
Participants with "normal emotion processing" were engaged in a
routine task. While doing this he consequently experiencing losses
and the associated negative emotions, they subsequently made safer
and more lucrative choices. Participants with brain damage that had
left them unable to experience such emotional responses, did not
change their behavior in this way.
Another important factor is the memory of events in decision
making. The state of mind of someone has works as "a retrieval cue"
whereby happy feelings make positive materials come to mind which
in turn have great impact on the decisions that are made. The same
is true of negative feelings.
Emotions and feelings cannot be extracted from the human mind. The
emotions felt in a particular situation will be recorded in the
emotional memory and can be activated when the person faces a
similar situation or has to make a difficult decision in a short
period of time. Often the decision maker is unaware of previous
experiences in similar situations.
Thus emotions cannot simply be classified as positive or negative
as we need to consider the consequences of the emotions in ultimate
decision-making.
Though there are a lot of expressions of emotions, we can broadly
divide them into two types: positive and negative. Positive
emotions are love, care, understanding, friendship, happiness,
satisfaction, etc., whereas negative emotions comprise anger, hate,
envy, greed, frustration, etc. We think with the help of our brain,
but most of the time we listen to our heart. Some people are more
emotional than others and hence, their decisions are most of the
time biased. Emotions influence our decisions, understand and
emotionally, support us. These emotions are responsible for many of
our important decisions for which later on, we may feel regretful
or consider them most cherished ones depending on the outcome. But
the fact is that they do affect our decision.