By: Mary Beth McEuen
A recent study captured in the Oxford Journal demonstrates that teenagers’ anticipation of uncertain outcomes is more rewarding to their brains than it is in young adults. Adolescents are hypersensitive to rewards. But this is just part of the story.
Interestingly, according to Cornell University, young people are aware of their vulnerability. They are able to estimate some of their risks, such as the odds of becoming a mother by the age of 20, quite accurately. Dr. Valerie Reyna has come to a startling conclusion, then, for why teenagers take such risks even when they know the odds. Young people take risks not because a belief that they are invulnerable, but because they engage in too much rational calculation when they are making choices.
Let me repeat that. It takes a minute to digest, doesn’t it? Teenagers take unreasonable risks because they engage in too much rational calculation.
Here is how it works. Even when a teenager knows the risks they run, they mentally weigh those risks against perceived benefits. When risks are engaged in only once or twice, the odds may appear favorable. In contrast, adults, “go with their gut.” They don’t move down the slippery slope of taking serious risks against immediate rewards. And, their choices are better as a result.
Reyna, and her colleague, Dr. Charles Brainerd, call this “Fuzzy Trace Theory.” Fuzzy Trace Theory tells us that:
One of the dual paths to processing risk judgments is highly deliberative and oriented toward facts and details. This is the type of thinking that corresponds to classical, logical models of economic decision making – the rational balancing of benefits against costs. And it is the type of reasoning that children and adolescents rely on most when making choices (Reyna, Adam, Poirier, LeCroy, & Brainerd, 2005).
The other route to making risk judgments tends to ignore details and focuses instead on the overall meaning or gist of a situation (Reyna & Kiernan, 1994). This form of thinking is more intuitive, and relies more on emotional reactions and situational cues than on deliberative calculation. It is also more categorical – seeing things in terms of black and white instead of shades of gray. With greater age and life experience, people increasingly utilize this second, “gist-based” path to making decisions (Reyna, 2004).
So, what do teenagers and business executives have in common? Teenagers actually do make decisions rationally…too rationally. Business executives are “teenage” wantabe’s. The mantra of rational decision-making is alive and well in management. The problem is that it just isn’t true. Emotions operate interdependently with reason in adult decision-making. Maybe it is time to recognize this fact and become more self-aware, to the degree it is consciously possible, of just how much emotion, emotional states, and moods impact decisions.