Emotions, emotions

As I wrote earlier, a few weeks ago I attended a seminar with professor Dmitry Repin.

It was a very interesting hour and a half that I spent listening to his research and to other researchers' theories. As I also mentioned earlier, his research is mainly about the stock market, but when I was there I could see the connection to Lovemarks and other marketing theories. They are all based on the answer to the question: "What makes a person (customer) choose one thing over another?"

Prof. Repin spoke about the Ultimatum Game. Terry Burnham did an experiment with the Ultimatum Game. He measured testosterone in the saliva of persons playing the game, coming to the conclusion that things that we might not be able to measure in everyday life (such as testosterone levels), effect people when making decisions. Repin also showed us the result from a study made by Anna Krivelyova and Cezare Robotti (Playing the field). They studied geomagnetic storms and the effect the storms had on people's moods and, in the prolongation, the trade on stock markets. Days when geomagnetic storms were present, the trade in stock markets was lower than other days.

An experiment carried out by Repin and Andrew W. Lo measured different physical factors at 8 traders at the Boston Stock Exchange. One of the traders did one transaction per second during certain time poeriods! Reason is probably not a big component when making those decisions, so one can assume that emotions have a big significance here. They also performed a study called "Fear and Greed in Finacial Markets", trying to map wether different personality types are "good" or "bad" traders, and also how the trading result effects the trader. I will not go into details, but check out a presentation of the studies here.

What is the most interesting is that emotions (of all kinds) and maybe other things such as "natural phenomenons" effect us when making decisions. They are very hard to measure, and very hard to model. So, we need to find ways on how to relate to them. How significant is this influence of the "emotional" component? Are emotional components sometimes more important than other components that effect us? In my opinion: yes, probably. But how do map them? How can we reach and effect peoples feelings, guide them in the direction we want? Lovemarks might be a step in the right direction, but I do belive we need to do more.

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