Brain Buys (14 page)

It is possible that we prefer the quick $100 to the $120 a month later, not because we are hopelessly seduced by immediate gratification, but because we simply don’t like waiting. This subtle but important point can be understood by considering the following choice: $100 in 12 months, or $120 in 13 months. Which would you pick? Just as in the previous example, you would gain an extra $20 by waiting one month. Logically one would expect that people who choose the $100 in the first case would again choose the $100 in the second scenario. Yet, in the second scenario, the majority of people now wait the extra month for the additional $20. Because the earliest reward is no longer immediate, people shift toward a more patient and rational strategy. Thus we favor the immediate choice not because we are averse to waiting one month, but because we want the money now! It is simply inherently more exciting to learn that we will be given $100 right now, than if we are informed we will be given the same amount in several months.

This insight is backed by brain imaging studies where subjects are offered choices between some money now and more money later. Some subjects are impulsive, choosing $20 today over $50 in 21 days; others are patient, choosing to wait 21 days to receive $22 rather than to receive an immediate $20. Regardless of whether individuals are impulsive or patient, parts of the brain, including evolutionarily older
limbic
areas involved in emotion processing, are significantly more activated by immediate rewards. By contrast, in other brain areas—including an evolutionarily newcomer, the lateral prefrontal cortex—activity better reflects the true value of a potential reward, independent of when it is offered.
¹⁰

Because our brain is rigged to favor immediate gratification, our long-term well-being sometimes suffers. Many people cannot help but surrender to the joy of a nonessential purchase, even with the penalty of having to pay high interest rates to a credit card company. The further into the future the consequences of our actions are placed, the harder it is to accurately balance the trade-off between the short- and long-term outcomes. The financial decisions of individuals, as well as the economic policies of nations, are often victims of a distorted evaluation of the short-term benefits versus the long-term costs. In the United States, Payday Loan stores are currently a multi-billion-dollar business. These are companies that provide short-term loans, contingent on proof of employment and a postdated check for the value of the loan plus a finance charge. The so-called finance charge is generally 15 percent of the value of the loan for a two-week period. This amounts to an annual percentage rate of 390 percent—a rate that is considered criminal and is thus illegal in some countries.
¹¹
Payday lenders may provide a legitimate service to some people who find themselves in sudden financial distress and do not have a credit card or other means to obtain a loan. But studies show that many borrowers take out multiple loans; others get caught in a debt cycle.
¹²
There is little doubt that these lenders are taking advantage of a number of brain bugs, including the difficulty of appreciating the long-term price being paid for the immediate access to cash.

In addition to the inherent sway of immediate gratification a further impediment to making rational long-term decisions is that they depend on how the brain perceives and measures time. We
know
that two months are twice as long as one month, but do they
feel
twice as long?

Decisions involving different periods of time rely in part on the fact that we represent temporal delays numerically. But our intuition about numbers is not as accurate as we often assume. The difference between $2 and $3 somehow seems to be greater than the difference between $42 and $43. The brain seems to be inherently interested in relative, not absolute, differences. If children are given a piece of paper printed with 0 on the left extreme, and 100 on the right, and then asked to place different numbers on this continuum, they generally place the number 10 close to the 30 percent point. When the assigned positions on the line are plotted against the actual numbers we do not obtain a straight line but a decelerating curve (well fit by a logarithmic function). In other words, there was a lot of breathing room for the small numbers, while the large ones got bunched together to the right. Of course, adults map numbers linearly, as a result of their math education; however, adults from indigenous Amazonian tribes who have not received a formal education position the numbers in a nonlinear manner similar to the children.
¹³

When it comes to time, educated adults behave like children and innumerate Amazonian natives. One study asked college students to represent upcoming periods of 3 to 36 months by the length of lines they drew on a computer screen. The relationship between the length and the number of months was not linear and again followed a logarithmic function. On average the difference in length of lines representing 3 and 6 months was more than double the difference between the lines representing 33 and 36 months.
¹⁴
So it is perhaps not surprising that the difference between now and 1 month seems like more than the difference between 12 and 13 months. Our representation of long periods of time seems to rely on our apparently innate tendency to represent quantities in a nonlinear fashion (a topic we will return to in Chapter 6), which may contribute to temporal discounting and poor long-term decision making.

SUBJECTIVITY OF TIME

Our intuitions about time are highly suspect. We know that the Summer Olympics happen every four years, or that a child reaches puberty around 12 years after he was born, but these are forms of declarative or factual knowledge, like stating that Pluto Neptune is the last planet of the solar system. We do not really know what 4 or 12 years
feel
like, in the same way we know what
hot
feels like. When was the last time you saw your old friend Mary? It may feel like a long time, but does it really feel any different after 6 months than it would after 9 months? Well before Einstein put forth his theory of special relativity, it was known that time, or at least our perception of it, was indeed relative and subject to distortions.

Typically, when we talk about our sense of time we are referring to our perception of events on the order of seconds to hours. When will the red light change? How long have I been waiting in this line? How long did that never-ending movie last? Although most people don’t put much thought into what type of clock they have in their head, they are aware that it was not built by the Swiss. We relate to the aphorisms “a watched pot never boils” and “time flies when you’re having fun,” because we have experienced the fact that time does indeed seem to dilate when we wish it to pass and contract when we wish it would not. Our subjective sense of time is capricious and has an open relationship with objective clock time. The degree to which this is true is somewhat surprising. In one study, participants viewed a 30-second clip of a fake bank robbery. Two days later, they were asked to estimate how long the robbery lasted, as might occur during an eyewitness testimony account. The average response was 147 seconds; only 2 of the 66 subjects estimated 30 seconds or less. When subjects were asked to estimate the duration immediately after viewing the tape, their estimates were better, but on average were still over 60 seconds (off by 100 percent).
¹⁵

The direction and magnitude of time estimation errors are dependent on many factors: attention, excitement, and fear. One simple but classic experiment demonstrating the importance of attention asked subjects to deal a deck of cards into either a single pile, two piles according to color, or four piles according to suit—the idea being that each of these tasks requires an increasing amount of attention to perform. In all cases, the subjects performed the task for 42 seconds before being interrupted and asked to estimate how long they thought they had been doing the task. The average time estimates were 52, 42, and 32 seconds, for the 1, 2, and 4 pile groups, respectively.
¹⁶
The more people had to pay attention to what they were doing, the more time seemed to fly by.

Another important factor in our perception of time is whether we are estimating it during (prospectively) or after (retrospectively) the fact. In other words, your sightseeing tour in Paris seemed to have flown by at the time, but the next day you might remember it as a long, event-filled day. It is as if in retrospect we are not really recalling how much time we thought had elapsed, but guesstimating based on how many memorable events were stored. Indeed, in many cases, memory and the perception of elapsed time are intertwined. A study performed by Gal Zauberman and colleagues at the University of Pennsylvania asked students to estimate how much time passed since specific events had occurred. For example, how long ago had the tragic shootings that killed 32 Virginia Tech students taken place? The first finding of the study was that students underestimated by 3 months events that had happened on average 22 months ago. Additionally, there was an effect of “memory markers”: those events that subjects felt had come to mind more often in the interim tended to have been thought to have occurred longer ago.
¹⁷
If you attended both a wedding and a funeral around two years ago, and since then had run into a number of people you met at the wedding and heard about the newlyweds’ wonderful honeymoon and shocking divorce, it is likely that you will believe that the wedding happened further back in time than the funeral.

The extent to which memory and the perception of the passage of time are coupled is heart-wrenchingly clear in the case of some amnesic patients. Clive Wearing is a British man with severe anterograde amnesia (his old memories are intact, but he is unable to form new long-lasting memories). In his case the amnesia was caused by a rare instance in which the herpes virus that normally results in cold sores produced encephalitis. Most mornings at some point Clive looks at his watch and writes in his diary, “9:00 I am awake.” At 9:30 he may cross out that line and write, “Now I am awake for the first time.” As his day progresses he is caught in this personal perpetual loop, crossing out the previous time and adding the new one. It appears that in the absence of any memory trace of what happened mere minutes ago, the only plausible hypothesis his brain can conceive of is that he just woke up. He does not seem to perceive the passage of time; he is frozen in the present. Our sense of time is entwined with memory because it requires a reference point, and without the ability to remember the location of the reference point on the timeline, our sense of time is perpetually impaired.
¹⁸

TEMPORAL ILLUSIONS

On the much shorter scale of hundredths of a second (tens of milliseconds) to a few seconds, the brain needs to keep track of time effectively to understand speech, appreciate music, or perform the highly coordinated movements necessary for catching a ball or playing the violin. Although timing on this scale is often automatic, it is critical to our ability to communicate with and navigate the world. For example, in speech the interval between different sound elements is critical for the discrimination of syllables such as “ba” and “pa”:
¹⁹
if you put your hand on your vocal chords you may be able to notice that when you say “ba” your lips separate around the same time your chords start vibrating, whereas when you say “pa” there is a delay between these events. Additionally, the pause between words is also fundamental in determining the meaning and prosody of speech. For example, in reading out loud sentences such as “No dogs, please” versus “No dogs please” the pause after the comma contributes to determining the meaning of each sentence.
²⁰
Similarly the pause between words can disambiguate the Jimi Hendrix mondegreen “excuse me while I kiss this guy” and “excuse me while I kiss the sky.” The brain’s extraordinary ability to accurately parse the temporal features of sounds is perhaps best illustrated by the fact that we can communicate in the absence of any pitch information whatsoever; those fluent in Morse code can communicate at above 30 words per minute, relying solely on the pauses and durations of a single sound.

Despite the universal importance of accurately timing events of a second and under, our perception of events in this range is subject to numerous illusions and distortions.
²¹
One example is the
stopped clock
illusion. If you have an analog clock with a second hand (one that “ticks,” not one with smooth and continuous motion), on occasion you may have shifted your gaze to the second hand, and for a brief moment thought to yourself “damn, the clock stopped,” but by the time you finished your thought you realized you were mistaken. As we first look at the second hand it seems to remain motionless for longer than we expect a second to last; it is as if time dilated or stood still for a moment, and for this reason is sometimes referred to as
chronostasis
. The illusion is related to shifts in attention, motion, and our internal expectations. Additionally, the physical characteristics of what we are looking at influence our estimates of duration, and generally the more the physical characteristics of an object engage our attention, the longer it seems to last. For example, when people are asked to judge the duration that pictures of faces are shown on a computer screen, people judge faces of angry people to have lasted longer than pictures of smiling people.
²²

On this short scale of around a second, the brain takes many liberties with time—not only distorting it but deleting and inserting events from the timeline, as well as rearranging the order in which events actually occurred. We all know that thunder and lightening are produced at the same time, but, hopefully, we see the lightning well before we hear the thunder. The fact that the speed of light is roughly a million times faster than the speed of sound not only generates significant delays for events miles away, but for events in our daily lives as well. If you are at the symphony and see a musician strike the cymbals together, do you have the experience of seeing them hit at the same time as you hear them? Yes, even if you are in the cheap seats 100 meters away. At this distance the delay between the arrival of the photons and the air vibrations from the cymbals is actually around 300 milliseconds, which is not an insignificant amount of time—enough for a sprinter to be off and running. But the brain takes the liberty of “adjusting” our percept of simultaneity—in effect the brain delays the perceived arrival of the visual stimulus, allowing sound to catch up.