Pessimists make more money than optimists

Main Category: Public Health
Article Date: 15 Feb 2004 - 0:00 PDT


Pessimists always do better at the gaming table and in the markets because they adapt behaviour to results, say psychologists. Elizabeth Day investigates the claim.

The pessimists among you will probably refuse to believe it: a study shows that gloomy-minded people are better at making money than their optimistic counterparts.

Despite their best efforts to think the worst, pessimists are more successful as gamblers and stock market players, according to psychological researchers.

In a paper published in this month's issue of the Personality and Social Psychology Bulletin, Dr Brian Gibson and Dr David Sanbonmatu said that pessimists were naturally cautious and therefore less likely to waste money on prolonging a losing streak.

The study asked 308 volunteers to answer questionnaires on their expectations and motivations in gambling. The researchers then measured how this deviated from the respondents' behaviour.

They recorded the frequency of the volunteers' visits to the casino, the sums of money they gambled, their average winnings or losses and variations in the intensity of their gambling.

After a losing experience, pessimists were 61 per cent more likely to remember recent losses and adjust their behaviour. Optimists were instead more likely to recall winning, even if the odds were stacked against them.

'Our study suggests that optimists, more so than pessimists, maintain positive expectations and continue gambling after experiencing negative gaming outcomes,' the academics from Central Michigan University said.

'We suggest that despite optimism's many benefits, there are common situations in which the pessimistic tendency to disengage is beneficial.'

The findings have been greeted with glee by the pessimist lobby and cheerful disbelief by the optimists. Self-confessed pessimist Quentin Letts, the Telegraph columnist and Daily Mail political sketchwriter, gave the study a cautious welcome but suggested that every silver lining carried a thundercloud.

'Pessimists are brilliant at making money but we can't enjoy it because we're always certain that our luck is about to end,' he sighed.

'The study's findings are unsurprising when you think that the entire insurance industry is founded on institutionalised pessimism: you get insured only if you think a terrible thing is about to happen to you.

'If you look at Winnie the Pooh you see that the optimist, represented by Tigger, is very irritating and always comes a cropper. He would be useless around a gambling table, whereas Eeyore always expects the worst and succeeds in a quiet way.'

Henrietta Knight, one of Britain's most successful racehorse trainers, believes in pessimism. 'If you think you are going to win every time you only get disappointed,' said Ms Knight, who trained the double Cheltenham Gold Cup winner Best Mate. 'If you are cautious and things go right then you are pleasantly surprised.'

The glass remained half-full, however, in optimistic quarters. Frederick Forsyth, the thriller writer, said that he was 80 per cent optimistic but remained 'pessimistic about the triumph of pessimism'.

He added cheerfully: 'I'm very doubtful about these findings because the most optimistic nation, America, is also the richest. A can-do attitude is much more likely to lead to material success, rather than our dreary, pessimistic British personality.'

Kathy Lette, the Australian novelist, said that the most successful people were neither optimistic nor pessimistic but a healthy combination of the two. Ms Lette, who is married to an Englishman, said: 'England is a nation of Eeyores. The English think optimism is an eye disease, unlike Americans, who suffer from personality priapism - they're always up. I would say I am naturally optimistic, but that is tempered by scepticism,' she added.

'As a chronic scepticemia sufferer, I don't think the study will make the slightest bit of difference: if you are an optimist you think you are successful, even if you're not. It doesn't matter if the bottle is half-empty or half-full so long as you've got the bottle.'

Although Sigmund Freud once equated optimism with ignorance, the Central Michigan University study runs counter to a 2002 study by psychologists at Yale University that claimed that optimists lived seven-and-a-half years longer than pessimists. So even if pessimists are better at making money, it seems they have less time to spend it. Now there's a reason to be depressed.

Source: Daily Telegraph online
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2004/02/15/npess15.xml&sSheet=/news/2004/02/15/ixhome.html

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