Why losing money may be even more painful than you think
8 May 2007
Losing money may be linked with fear and pain in the brain, according to scientists from the Wellcome Trust Centre for Neuroimaging at UCL.
Using an fMRI brain scanner, researchers recorded the brain activity of 24 healthy subjects as they played a gambling game to win money. They found that the subjects were accurately learning to predict when there was a chance of winning or losing money, and that this process appeared to occur in a region of the brain called the striatum.
Being able to make predictions about rewards and punishments is important, since it allows us to take appropriate action early, either to avoid punishments or to benefit from rewards. This ability is guided by a 'prediction error', whereby the brain learns to make predictions based on previous mistakes. The research shows that there appears to be a separate response when the prediction results in a financial loss, as opposed to a gain.
Dr Ben Seymour, who led the study, said: "Although we already know an impressive amount about how the brain learns to predict financial gains, until now, we have known little about how we deal with losing money."
The researchers found surprising similarities between the response to financial losses and a system that they had previously identified for responding to pain, which they believe allows the brain to predict imminent harm and allow immediate defensive action to be taken.
Dr Seymour said: "Clearly, none of us wants to lose money in the same way that none of us wants to experience pain. It would make sense that the way that we learn to predict and hence avoid both of them should be linked."
Understanding how the brain's systems for learning to predict financial losses and gains interact may provide important insights into why some people gamble more than others, and why some become addicted to it.
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