Sleep-deprived people are prone to making decisions that emphasize monetary gain and not those that reduce losses
If people do not get enough sleep, they can make overtly optimistic decisions and are also prone to risky gambling, a study by neuroscientists at two Duke University medical schools concluded. Their work represents the first study that focuses on the impact of sleep deprivation on the brain’s ability to make financial decisions instead of the effect that inadequate sleep has on attention span.
It is a popular belief that lack of sleep damages our decision making ability, adversely affecting attention and memory. To debunk this theory, Duke scientists used a functional MRI to prove how sleep deprivation led to increased brain activity in brain regions that process positive outcomes, while consequently leading to decreased activation in brain regions that process negative outcomes.
This breakthrough demonstrates that sleep-deprived people are prone to making decisions that emphasize monetary gain and not those that reduce losses.
"Even if someone makes very sound, risky financial decisions after a normal night of sleep, there is no guarantee that this same person will not expose you to untoward risk if sleep deprived. I think it's critical that society consider whether to continue doing things the old way. Old habits die hard, but maybe some of them should die," said co-author Michael Chee, MD, senior author and professor at the Neurobehavioral Disorders Program at Duke-NUS in Singapore.
Co-author Scott Huettel, PhD, associate professor of psychology and neuroscience and director of the Duke Center for Interdisciplinary Decision Science, pointed to empirical evidence of this study if one looks at casinos that often encourage risk-seeking behavior by providing free alcohol, using flashy lights and sounds, and converting money into abstractions like chips or electronic credits.
"Sleep deprivation surely makes gambling even more tempting for many people," said Huettel.
"Late-night gamblers are fighting more than just the unfavorable odds of gambling machines; they are fighting a sleep-deprived brain's tendency to implicitly seek gains while discounting the impact of potential losses," said Vinod Venkatraman, the lead author and graduate student in Psychology and Neuroscience at Duke.
"Countermeasures that combat fatigue and improve alertness may be inadequate for overcoming these decision biases."
For this study, researchers tested 29 healthy adult volunteers with an average age of 22. The study was funded by grants from the Defense Science and Technology Agency Singapore and the National Medical Research Council Singapore. Other authors include Lisa Y. M. Chuah of Duke-NUS, and John W. Payne of The Fuqua School of Business at Duke.