Playing Against the Odds: The Role of Mood, Experience and Risk in Decision-making

Abstract

Past research in decision-making has typically utilized hypothetical measures or simplified gambles to investigate the decisions people make. This method has been criticized as it lacks ecological validity and omits background knowledge and experience from the decision process. Mixed findings in the literature have emerged in terms of the effects positive and negative affect on risk-taking. The Affect Infusion Model (AIM) consolidates the mixed findings by incorporating factors that affect the extent to which affect is infused in the judgment process (i.e. experience). The current research examined the effects of mood on risk-taking in a decision task that allowed for background knowledge and experience; the game of poker. Three studies were conducted to test the predictions of the AIM using a novel methodology. Mood was manipulated in all three studies. Study 1 found evidence of the moderating role of experience in the relationship between affect and risk-taking in a hypothetical poker decision task. The decisions of more experienced participants were less infused with affect than less experienced participants. Study 2 replicated the findings of Study 1 in a real-time poker task conducted in a laboratory setting. Study 3, using a similar design to Study 2, introduced a task incentive and an additional condition that provided real-time odds/expected value information during the decision task. An unexpected finding emerged with respect to the moderating role of experience in the relationship between affect and risk-taking. With the introduction of a task incentive, the decisions of more experienced participants were more infused with affect than less experienced participants during the first 20 minutes of the task. Evidence of a main effect of Mood and Odds Information was also found. An additional Mood X Odds Information effect on risk-taking emerged for decisions early in the decision task. The results obtained in the present research program are discussed with respect to their novel contributions to the decision-making and risk-taking literature.