The Psychology of Everyday Life: Motivation and the Search For HappinessThe Psychology of Money |
How well do we evaluate the probability of risk and reward? |
Our emotions are not very good at considering probability. We are highly attuned to the intensity of a risk or reward and get emotionally aroused by high value rewards or risks, but we do a poor job of balancing the intensity of a consequence with its probability. For example, many people are more afraid of a terrorist attack than of hypertension, although far more people in the developed Western world will die from heart disease than from a terrorist attack.