The Key to Financial Reform: Pay Banker Bonuses in Food Stamps?
In one of the stranger studies in recent memory, it turns out that hungrier people take bigger risks. This changes financial reform theory entirely. Maybe the stock market should have food breaks every three hours so traders can snack. Instead of a resolution fund, how about a hungry banker fund? Perhaps expense accounts that provide big meal allowances were a good thing after all. Here's Catherine Rampell reporting on the NY Times Economix blog:
Researchers put study subjects on different diets to affect their metabolic states, and then week after week gave them with options to participate in different kinds of lotteries. Some of the lotteries were riskier than others, in terms of their expected and potential payouts. Generally speaking, when subjects were in hungrier states, they chose the riskier lottery options, and when they were full they choose safer lotteries.
Read the full story at New York Times Economix.