Financial decisions influenced by intensity of light

August 4, 2017
Credit: CC0 Public Domain

A study of more than 2,500 people provides new evidence about the effects of luminance on the quality and consistency of our financial decision-making.

Luminance is a measurement of the amount of light that falls on the earth's surface, which can be affected by cloud cover, humidity, suspended particles, and time of day and year.

Researchers already know luminance affects behaviour, with sensors in the human retina carrying continuous information on light levels to the hypothalamus, a section of the brain which regulates functions such as hunger, sleep and sex drive.

The University of Sydney's Associate Professor Agnieszka Tymula is the corresponding author of a new study published in PLOS ONE, which adds to existing knowledge by investigating how luminance affected 2,530 's decisions about monetary gambles.

"On the days with higher light intensity, people made worse decisions and they were more inconsistent in the choices that they made," said Associate Professor Tymula.

Luminance also affected people's attitudes.

When the luminance level was high people were more likely to avoid known risks. When offered a choice between a certain $5 payout and a 50 percent chance of $20, they were more likely to go for the certain $5.

Surprisingly, they had greater tolerance for unknown risks. On high luminance days, they were more likely to go for an unknown chance of getting $20 over the certain $5 payout.

"Overall, the effects are not of an enormous magnitude, but nevertheless they are consistent, significant, and strong enough to be expected to have significant effects on financial markets."

Associate Professor Tymula and her co-author, Professor Paul Glimcher of New York University, asked people to make 40 monetary decisions, using touch screens mounted at an exhibition on ageing at the National Academy of Science Museum in Washington D.C.

In each situation, people could choose a certain payout of $5, or a lottery option with the possibility of receiving nothing, or a cash amount between $5 and $125.

Behavioural data from the responses received at the museum was then merged with luminance measurements from a nearby weather station.

The researchers found that luminance affects -making in different ways, with higher and lower levels of intensity found to affect how much risk people can tolerate, how comfortable they are making decisions in ambiguous situations, and how consistent their decisions are over a range of choices.

Explore further: Multi-luminance mobility test identifies visual impairment

More information: Paul W. Glimcher et al. Let the sunshine in? The effects of luminance on economic preferences, choice consistency and dominance violations, PLOS ONE (2017). DOI: 10.1371/journal.pone.0181112

Related Stories

New research could help humans see what nature hides

June 26, 2017

Things are not always as they appear. New visual perception research at The University of Texas at Austin, published in the Proceedings of the National Academy of Sciences, explains the natural limits of what humans can see ...

Darks are conveyed faster than lights

February 11, 2016

"Did something move over there?" Everyone has experienced this situation. One is looking towards a sound source, but with the best will in the world, one cannot detect an object. Only its sudden movement, even if minimal, ...

Recommended for you

The oldest plesiosaur was a strong swimmer

December 14, 2017

Plesiosaurs were especially effective swimmers. These long extinct "paddle saurians" propelled themselves through the oceans by employing "underwater flight"—similar to sea turtles and penguins. Paleontologist from the ...

2 comments

Adjust slider to filter visible comments by rank

Display comments: newest first

kuncoro
not rated yet Aug 06, 2017
Am I missing something here? What's the difference between 'high luminance level' and 'high luminance', the article states:

"When the luminance level was high people were more likely to ... go for the certain $5."
and also
"On high luminance days, they were more likely to go for an unknown chance of getting $20 over the certain $5 payout."
RealScience
not rated yet Aug 06, 2017
@ kuncoro - the first case refers to KNOWN risks (e.g., a 50% chance of $20):
When the luminance level was high people were more likely to avoid known risks. When offered a choice between a certain $5 payout and a 50 percent chance of $20, they were more likely to go for the certain $5.


The second case refers to unknown risks:
Surprisingly, they had greater tolerance for unknown risks. On high luminance days, they were more likely to go for an unknown chance of getting $20 over the certain $5 payout.


Apparently on dark days people don't like an unknown chance, and on bright days they prefer an unknown chance to either certainty or a known chance.
I agree that it is weird, but the article itself agrees that it is surprising.

Let's see if this result is confirmed by future work...

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.