How Wishful Thinking Can Be Harmful

Occasionally, many of us may think wishfully or be overly optimistic. Yet, the question arises: when is this most prone to occur, and when might it become detrimental?

Research spearheaded by the University of Amsterdam (UvA) conclusively shows that the more insecurity and anxiety present in a situation, the higher the tendency for people to adopt an overly optimistic outlook—even to the extent that it is harmful. The findings of this study are published in the American Economic Review.

"People do not always pursue truth; their beliefs are often shaped by emotions, gravitating towards what feels pleasant or comforting, such as the belief in an afterlife or optimistic views on health outcomes," states Jo?l van der Weele, a professor of Economic Psychology at the UvA.

In collaboration with Jan Engelmann, a professor of Neuroeconomics, and an international team, Van der Weele explored whether individuals tend to become overly optimistic when confronted with potential difficulties. "Previous investigations into wishful thinking have been inconclusive, with many not supporting the notion," Engelmann remarks. These studies largely focused on positive outcomes like lottery wins. Our research examines the impact of both positive and negative outcomes on biased beliefs."

Choosing the most desirable outcome is challenging due to the intricacies of self-deception and its underlying causes in real-life situations. This study involved experiments with more than 1,700 participants in a laboratory setting and online. Participants were shown patterns, such as stripes in different orientations or colored dots, for a brief moment and were asked to identify the pattern they observed. Some patterns were associated with negative outcomes to elicit anxiety, either a mild, non-harmful electric shock (in the laboratory) or a monetary loss (online). "Our aim was to determine if people were more prone to misidentify patterns linked to negative outcomes, mistaking them for harmless ones. This would signify wishful thinking," Van der Weele elucidates.

Participants consistently demonstrated a lower likelihood of accurately identifying patterns connected to shocks or losses. "Participants appeared to recognize patterns that were more appealing to them," Engelmann notes. "While prior research on wishful thinking related to positive outcomes yielded inconsistent results, with many studies finding no significant effect, our research clearly indicates that anxiety about an outcome fosters wishful thinking."

To encourage a more realistic perspective, the researchers tested several interventions. Making the patterns more discernible was one approach. "Indeed, lessening uncertainty diminished wishful thinking," Van der Weele observes. Another strategy involved offering higher rewards for correct pattern recognition, which had a minimal impact unless participants had additional time to gather evidence about the pattern they were shown. "When individuals had more time to accumulate evidence and were rewarded more for correct responses, they adopted a more realistic viewpoint," Engelmann explains.

In experiments where negative outcomes were replaced with positive ones, wishful thinking was absent among participants. According to the study's authors, this suggests that reducing negative emotions can mitigate overoptimism.

Wishful thinking can be beneficial as it helps individuals cope with negative feelings and manage uncertainty. "Wishful thinking plays a crucial role in human ability to deal with anxiety concerning potential future events," Engelmann states.

The concern for Van der Weele and Engelmann lies in excessive optimism preventing individuals from seeking necessary information or taking beneficial actions. "Excessive hopefulness is observed in uncertain situations such as climate change, financial market fluctuations, and even personal health scenarios where individuals avoid medical advice, thinking everything will turn out fine. It's important to discern when wishful thinking is helpful or harmful."

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