University of Pittsburgh
October 2, 2012

People Who Trust Their Feelings Are More Likely to Correctly Predict Outcomes of Events, According to Newly Published Research

Pitt business professor part of “going with your gut feeling” study examining emotions and decision making

 

PITTSBURGH—The more people trust their feelings, the more accurately they can predict the outcomes of things that range from the mundane, like the weather, to the significant, like the outcome of elections and future stock market levels, according to new research published in the October 2012 edition of the Journal of Consumer Research.

The study—by a team comprising Andrew Stephen, assistant professor in the University of Pittsburgh’s Joseph M. Katz Graduate School of Business and College of Business Administration, and Columbia University Business School faculty members Michel Tuan Pham, Kravis Professor of Business and Marketing, and Leonard Lee, associate professor of marketing—found that people who trusted their emotions more accurately predicted future events than individuals who did not place trust in their feelings, a phenomenon they call the “emotional oracle effect.” Their research article is titled “Feeling the Future: The Emotional Oracle Effect.”

"The results show that your feelings are a valid information source, provided you have some prior knowledge of the decision topic," said Stephen. "The normal line of thought when making predictions or forecasts is that people should be more rational, that you probably shouldn't go with your gut feeling. Our research indicates that in some cases relying on your feelings is likely to help you."

Through a series of eight studies, researchers asked participants to predict the outcomes of events like the 2008 U.S. Democratic Party presidential primary, movements of the Dow Jones Industrial Average, the winner of a college football championship game, and the weather. The results across all studies consistently revealed that people with higher trust in their feelings were more likely to correctly predict the final outcome than those with lower trust in their feelings.

In the study where respondents were asked to pick the winning candidate in the 2008 primary contest between Hillary Clinton and Barack Obama, high–trust–in–feelings respondents correctly predicted Obama’s winning about 72 percent of the time compared with low–trust respondents, who predicted Obama’s winning about 64 percent of the time—a striking result given that major polls reflected a very tight race between Clinton and Obama at the time the study was conducted. 

For the winner of television’s “American Idol” competition, the difference was 41 percent for high–trust–in–feelings respondents compared to 24 percent for low–trust respondents. In another study, participants were even asked to predict future levels of the Dow Jones Industrial Average. Those who trusted their feelings were 25 percent more accurate than those with low trust in their feelings.

The researchers explain their findings through a “privileged window” hypothesis. This hypothesis is based on the idea that people’s feelings serve as meta-summaries of prior experience, where the brain encodes life experiences, and feelings catalogue the information.

"We are encoding experiences every second of every day. Actually tapping into that is a challenge, because it's mostly unconscious,” said Stephen. “Trusting your feelings is how you access that catalogued information.”

In accordance with the privileged window hypothesis, the researchers caution that some amount of relevant knowledge appears to be required to more accurately forecast the future. 

For example, in one study participants were asked to predict the weather. From the 175 online participants across 46 states, those participants who trusted their feelings were better able to predict local weather. While they were able to predict the weather within their own zip code areas, they could not predict the weather in Beijing or Melbourne. 

Stephen says the emotional oracle effect isn't an invitation for people to disregard reason-based judgment. Instead, it shows that intuition is a valuable complement. People who heed their feelings have a broader perspective than those who don't. The reason? Because those feelings are based on prior experiences, not just the immediate facts in front of them.

"It's a reminder that it's not wrong to go with your gut," Stephen said. "However, the effectiveness is not so much just that you have feelings—it's whether you trust them or not. Your feelings give you a more general view and can be a relevant input."

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10/2/12/mab/cjhm