NYU Stern
Share / Print

Trade of the trick

By Adam Alter

adam alter head shot 2013 article image

From weather conditions to simple, strong and self-relevant names, we’re easily swayed to part with our money when the conditions are right.

In 2003, two finance researchers noticed a strange pattern in the world’s stock-market prices. Between 1982 and 1997, prices across 26 of the world’s markets rose more on sunny days than on cloudy, rainy or snowy ones. Traders generally invest only after weighing a string of complex financial variables, yet somehow investors from Bangkok to Brussels were swayed by the weather.

We like to think that making important decisions is the result of careful contemplation and intelligence. But psychologists have uncovered a striking number of cues — some as simple as sunshine — that shape our thoughts, feelings and behaviors below the level of conscious awareness.

For example, if you’re struggling with a mental puzzle, watch a light bulb as it illuminates and you’ll be more likely to reach a solution. As a metaphor for insight, it actually leads us to insight. Other researchers have shown that we’re more likely to behave honestly when we’re looking at a picture of a pair of human eyes, gazing at ourselves in the mirror, or when we’re bathed in a blue light. All three cues suggest that we’re being watched — by ourselves, by other people or by the police, who identify themselves with blue lights in much of the world — so we tend to avoid unethical or dishonest behaviors.

Read full article as published in the New York Post.

___
Adam Alter is an Assistant Professor of Marketing with affiliated appointment in the Psychology Department