As reported by Psychology Prof. Daniel Gilbert on the Happy Days blog at nytimes.com, Maastricht University researchers gave (volunteer) subjects a series of 20 electric shocks. Some subjects were told that they would receive an intense shock every time while others were told that they would receive 17 mild shocks and 3 intense ones, but that they wouldn’t know on which of the 20 the intense shocks would come. The study showed that subjects who thought there was a small chance of receiving an intense shock were more afraid — they sweated more profusely, their hearts beat faster — than those who knew for sure that they’d receive an intense shock. Interestingly, that’s because people feel worse when something bad might occur than when something bad will occur — they find uncertainty more painful than the things they’re uncertain about.
A colostomy reroutes the colon so that waste products leave the body through a hole in the abdomen. Yuck! A University of Michigan-led research team studied patients whose colostomies were permanent as well as patients who had a chance of someday having their colostomies reversed. Six months after their operations, patients who knew they would be permanently disabled were happier than those who thought they might someday be returned to normal. Similarly, researchers at the University of British Columbia studied people who had undergone genetic testing to determine their risk for developing a neurodegenerative disorder known as Huntington’s disease. Those who learned that they had a very high likelihood of developing the condition were happier a year after testing than those who did not learn what their risk was.
Why do people seem to prefer to know the worst rather than merely to suspect it? According to Gilbert, that’s probably because when most of us get bad news we cry for a bit and then get busy making the best of things. We change our behaviors and we change our attitudes. We raise our attentiveness and lower our expectations. We find our bootstraps and pull (pretty hard if necessary). But we can’t come to terms with circumstances whose terms we don’t yet know. An uncertain future leaves us stranded in an unhappy present with nothing to do but wait. I suspect that these tests ought to teach us something about managing expectations.
We all respond positively to increased certainty in our lives (including in financial outcomes) — even after a major shock and when that certainty limits our prospective gain. In these highly uncertain times, such increased certainty is a highly valuable commodity. We would all be well-served to consider the value of certainty when we create and implement financial and retirement plans.