onal Responses to Neuropsycholog-ical Tasks in Normal Volunteers: An fMRI Study.” Neuropsychophar-macology, April 13.
26. Lane, S. D., Cherek, D. R., Tcheremissine, O. V., et al. 2005. “AcuteMarijuana Effects on Human Risk Taking.” Neuropsychopharmacology30(4) (April): 800–809.
27. Lane, S. D., Cherek, D. R., Pietras, C. J., and Tcheremissine, O. V.2004. “Alcohol Effects on Human Risk Taking.” Psychopharmacology(Berlin) 172(1) (February): 68–77.
28. Rogers, R. D., Lancaster, M., Wakeley, J., and Bhagwagar, Z. 2004.“Effects of Beta-Adrenoceptor Blockade on Components of Hu-man Decision-Making.” Psychopharmacology (Berlin), 172(2) (March):157–164.
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
338
INSIDE THE INVESTOR’S BRAIN
29. Deakin, J. B., Aitken, M. R., Dowson, J. H., et al. 2004. “DiazepamProduces Disinhibitory Cognitive Effects in Male Volunteers.” Psy-chopharmacology (Berlin). 173(1–2) (April): 88–97.
30. Lane, S. D., Tcheremissine, O. V., Lieving, L. M., et al. 2005. “AcuteEffects of Alprazolam on Risky Decision Making in Humans.” Psy-chopharmacology (Berlin), April 14.
31. Morgan, D., K. Grant, H. Gage, et al. 2002. “Social Dominance in Mon-keys: Dopamine D2 Receptors and Cocaine Self-Administration,” Na-ture Neuroscience 5: 169–174.
32. Ibid.
Chapter 5: Intuition
1. Browning, E. S. 2006. “Keeping Cool amid Global Strife.” Wall Street
Journal, July 17.
2. Cohen, J. 2005. “The Vulcanization of the Human Brain: A Neural Per-spective on Interactions between Cognition and Emotion.” Journal ofEconomic Perspectives 19: 3–24.
3. Norretranders, T. 1998. The User Illusion: Cutting Consciousness
Down to Size. New York: Penguin Viking.
4. Kaufman, M. 2002. Soros: The Life and Times of a Messianic Billion-
aire. New York: Vintage, p. 140.
5. Cymbalista, F., and D. MacRae. 2004. “George Soros: How He KnowsWhat He Knows, Part 1: The Belief in Fallibility.” Stocks, Futures, andOptions, March 8.
6. Hirshhorn, D. 2007. Personal comunication, February 16.7. Lefevre, E. 1923. Reminiscences of a Stock Operator. American Re-
search Council.
8. Peters, E., I. M. Lipkus, and M. A. Diefenbach. “The Functions of Affectin Health Communications and in the Construction of Health Prefer-ences.” Journal of Communication 56: S140–S162.
9. Ibid.10. Peters, E., and D. V ¨astfj ¨all. 2005. “Affective Processes in the DecisionMaking by Older Adults.” Papers from the Workshop on Decision Mak-ing Needs of Older Adults. Working Paper. //www7.nationalacademies.org/csbd/peters paper.pdf#search=%22fear%20induction%20loss%20aversion%20curve%22.
11. Goleman, D. 1998. Working with Emotional Intelligence. London:
Bloomsbury, p. 317.
12. Ibid., p. 319.13. Loewenstein, G., and J. S. Lerner. 2003. “The Role of Affect in De-cision Making.” Handbook of Affective Science, ed. R. Davidson,
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
Notes
339
H. Goldsmith, and K. Scherer. Oxford: Oxford University Press, pp.619–642.
14. Ibid.15. Winkielman, P., K.C. Berridge, and J.L. Wilbarger. 2005. “Unconsciousaffective reactions to masked happy versus angry faces inﬂuence con-sumption behavior and judgments of value.” Personality and SocialPsychology Bulletin 1: 121–135.
16. Trujillo, J., B. Knutson, M. P. Paulus, P. Winkielman. 2006. “TakingGambles at Face Value: Effects of Emotional Expressions on Risky De-cisions.” Working paper. http://www.gsb.stanford.edu/FACSEMINARS/events/marketing/pdfs%202006/2006 04-19 Winkielman paper2.pdf.
Chapter 6: Money Emotions
1. Niedenthal, P., J. Halberstadt, and A. Innes-Ker. 1999. “Emotional Re-
sponse Categorization.” Psychological Review 106(22): 337–361.
2. Niedenthal, P. M., and S. Kitayama (eds.). 1994. The Heart’s Eye: Emo-tional Inﬂuences in Perception and Attention. New York: AcademicPress.
3. Lerner, J. S. and Keltner, D. (2000). “Beyond Valence: Toward a Modelof Emotion-Speciﬁc Inﬂuences on Judgment and Choice.” Cognitionand Emotion 14: 473–493
4. Loewenstein, G., and J. S. Lerner. 2003. “The Role of Affect in Deci-sion Making.” In Davidson, R., H. Goldsmith, and K. Scherer (eds.),Handbook of Affective Science. Oxford: Oxford University Press, pp.619–642.
5. Fredrickson, B. L. 2001. “The Role of Positive Emotions in Positive Psy-chology: The Broaden-and-Build Theory of Positive Emotions.” Amer-ican Psychologist 56: 218–226.
6. Lyubomirsky, S., K. M. Sheldon, and D. Schkade. 2005. “The Beneﬁts of
Frequent Positive Affect.” Psychological Bulletin 131: 803–855.
7. Abbe, A., C. Tkach, and S. Lyubomirsky. 2003. “The Art of Living byDispositionally Happy People.” Journal of Happiness Studies 4: 385–404.
8. Bodenhausen, G. V., G. P. Kramer, and K. S ¨usser. 1994. “Happiness andStereotypic Thinking in Social Judgment.” Journal of Personality andSocial Psychology 66: 621–632.
9. Isen, A. M., and B. Means. 1983. “The Inﬂuence of Positive Affect on
Decision-Making Strategy.” Social Cognition 2: 18–31.
10. Forgas, J. P. 1991. “Affect and Social Judgments: An Introductory Re-view.” Emotion and Social Judgments, ed. J. P. Forgas. Oxford: Perg-amon Press, pp. 3–29.
11. Ibid.
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
340
INSIDE THE INVESTOR’S BRAIN
12. Isen, A. M., T. E. Nygren, and F. G. Ashby. 1988. “Inﬂuence of Posi-tive Affect on the Subjective Utility of Gains and Losses: It Is Just NotWorth the Risk.” Journal of Personality and Social Psychology 55(5)(November): 710–717.
13. Isen, A. 1999. “Positive Affect.” Handbook of Cognition and Emo-tion, ed. T. Dalgleish and M. Power. Chichester, England: John Wiley &Sons.
14. Lyubomirsky, S., and S. Nolen-Hoeksema. 1995. “Effects of Self-Focused Rumination on Negative Thinking and Interpersonal Problem-Solving.” Journal of Personality and Social Psychology 69: 176–190.
15. Mellers, B. A., A. Schwartz, and I. Ritov. 1999. “Emotion-Based Choice.”
Journal of Experimental Psychology 128: 332–345.
16. Fogel, S. O., and T. Berry. 2006. “The Disposition Effect and IndividualInvestor Decisions: The Roles of Regret and Counterfactual Alterna-tives.” Journal of Behavioral Finance 7(2): 107–116.
17. Ibid.18. Hurley, D. 2005. “Divorce Rate: It’s Not as High as You Think.” The New
York Times, April 19.
19. Lerner, J. S., D. A. Small, and G. Loewenstein. 2004. “Heart Strings andPurse Strings: Carry-over Effects of Emotions on Economic Transac-tions.” Psychological Science 15: 337–341.
20. Ibid.21. Lerner, J. S., and D. Keltner. 2001”Fear, Anger, and Risk.” Journal of
Personality and Social Psychology 81: 146–159.
22. See note 19.23. Bodenhausen, D., L. Sheppard, and G. Kramer. 1994. “Negative Affectand Social Judgment: The Differential Impact of Anger and Sadness.”European Journal of Social Psychology 24(1): 45–62.
24. See note 19.25. Sieff, E. M., R. M. Dawes, and G. Loewenstein. 1999. “Anticipated versusActual Responses to HIV Test Results.” American Journal of Psychol-ogy 112(2): 297–311.
26. Read, D., and G. Loewenstein. 1999. “Enduring Pain for Money: Deci-sions Based on the Perception and Memory of Pain.” Journal of Behav-ioral Decision Making 12(1): 1–17.
27. Dunning, D., L. Van Boven, and G. Loewenstein. 2001. “EgocentricEmpathy Gaps in Social Interaction and Exchange.” In Lawler, E., M.Macey, S. Thye, and H. Walker (eds.), Advances in Group Processes,vol. 18. New York: Elsevier Limited, pp. 65–97.
28. Gilbert, D. T., E. C. Pinel, T. D. Wilson, and S. J. Blumberg. 1998. “Im-mune Neglect: A Source of Durability Bias in Affective Forecasting.”Journal of Personality and Social Psychology 75(3): 617–638.
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
Notes
341
29. Mellers, B. A., A. Schwartz, K. Ho, and I. Ritov. 1997. “Decision AffectTheory: Emotional Reactions to the Outcomes of Risky Options.” Psy-chological Science 8: 423–429.
30. See note 4.31. Wilson, T. D., T. Wheatley, J. M. Meyers, et al.. 2000. “A Source of Dura-bility Bias in Affective Forecasting.” Journal of Personality and SocialPsychology 78(5) (May): 821–836.
32. Gross, J. J., and R. W. Levenson. 1993. “Emotional Suppression: Phys-iology, Self-Report, and Expressive Behavior.” Journal of Personalityand Social Psychology 64: 970–986.
33. Keltner, D., K. D. Locke, and P. C. Audrain. 1993. “The Inﬂuence of At-tributions on the Relevance of Negative Feelings to Personal Satisfac-tion.” Personality and Social Psychology Bulletin 19: 21–29.
34. Gasper, K., and G, L. Clore. 1998. “The Persistent Use of Negative Affectby Anxious Individuals to Estimate Risk.” Journal of Personality andSocial Psychology 74: 1350–1363.
35. Lerner, J., and P. E. Tetlock. 1999. “Accounting for the Effects of Ac-
countability.” Psychological Bulletin 125: 255–275.
Chapter 7: Joy, Hope, and Greed
1. Securities and Exchange Commission 2000. “SEC Brings FraudCharges in Internet Manipulation Scheme: Settlement Calls for Re-turn of $285,000 in Illegal Gains.” Case 2000-135. Washington, D.C.,September 20, 2000. Securities and Exchange Commission Press Re-lease. www.sec.gov/news/press/2000-135.txt.
2. Lewis, M. 2001.
“Jonathan Lebed: Stock Manipulator, S.E.C.
Nemesis—and 15.” New York Times Magazine, February 25.
3. “Pump and Dump.” 2000. 60 Minutes. CBS News: New York, October
19.
4. Berg, S. Z. 2000. “Fraudulent Stock Schemes Still Vexing Investors,SEC.” TheStreet.com: Personal Finance: Investing. TheStreet.com.December 16.
5. Elsbach, K. D., and Barr, P. S. 1999. “The Effects of Mood on Individ-uals’ Use of Structured Decision Protocols.” Organizational Science181: 185–194.
6. Ofﬁce of the New York State Attorney General Eliot Spitzer. 1999.“From Wall Street to Web Street: A Report on the Problems andPromise of the On-line Brokerage Industry.” Prepared by InvestorProtection Internet Bureau and Securities Bureau, 1189 PLI/Corp355, 395 (1999). www.oag.state.ny.us/investors/1999 on-line brokers/brokers.html.
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
342
INSIDE THE INVESTOR’S BRAIN
7. Kahn, J. 1999. “On-line Brokerages Use Advertising in a Battle forNew Customers.” New York Times, October 4. www.nytimes.com/library/tech/99/10/biztech/articles/04trad.html.
8. Nofsinger, J. R. 2001. Investment Madness: How Psychology AffectsYour Investing . . . and What to Do about It. Upper Saddle River, N.J.:Prentice Hall, p. 129.
9. Levitt, A. 1999. “Plain Talk About On-line Investing.” Speech at the Na-tional Press Club (May 4); see also Report of NASDR Concerning theAdvertisement of On-line Brokerages (September 21, 1999).
10. See note 6.11. SEC Ofﬁce of Compliance Inspections and Examinations. 2001. “Ex-aminations of Broker-Dealers Offering On-line Trading: Summary ofFindings and Recommendations” 1 (January 26). www.sec.gov/news/studies/online.htm.
12. Cassidy, J. 2002. “The Greed Cycle: How the Financial System Encour-aged Corporations to Go Crazy.” The New Yorker, September 23.
13. Krugman, P. 2002. “Greed Is Bad.” New York Times, June 4.14. Kuhnen, C., and B. Knutson. 2005. “The Neural Basis of Financial Risk-
Taking.” Neuron, 47(5) (September 1).
15. Knutson, B., S. Rick, G. E. Wimmer, et al. 2007. “Neural Predictors of
Purchases.” Neuron 4;53(1): 147–156.
16. Heath, R. G. 1964. “Pleasure Response of Human Subjects to DirectStimulation of the Brain: Physiologic and Psychodynamic Considera-tions.” In Heath, R. G. (ed.), The Role of Pleasure in Human BehaviorNew York: Hoeber, pp. 219–243.
17. Knutson, B., G. W. Fong, S. M. Bennett, et al. 2003. “A Region of MesialPrefrontal Cortex Tracks Monetarily Rewarding Outcomes: Character-ization with Rapid Event-Related fMRI.” NeuroImage 18: 263–272.18. Knutson, B., C. S. Adams, G. W. Fong, and D. Hommer. 2001. “Antici-pation of Monetary Reward Selectively Recruits Nucleus Accumbens.”Journal of Neuroscience 21: RC159.
Chapter 8: Overconﬁdence and Hubris
1. Samuelson, P. 2002. “Is There Life after Nobel Coronation?” Nobel Web.
http://nobelprize.org/economics/articles/samuelson/index.html.
2. Byrne, J. A., W. C. Symonds, and J. E. Siler. 1991. “CEO Disease.” Busi-
ness Week, April 1: 52–60.
3. Lenzner, R. 1998. “John Meriwether, Former Salomon Brothers Trader,Uses Leverage.” Investing: Archimedes on Wall Street. Forbes, October19.
4. Dreman D. 1977. Psychology and the Stock Market: Investment Strat-
egy Beyond Random Walk.New York: AMACOM, p. 78.
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
Notes
343
5. Biais, B., D. Hilton, K. Mazurier, and S. Pouget. 2002. “Psychological
Disposition and Trading Behavior.” Unpublished manuscript.
6. O’Creevy, F, M. N. Nicholson, E. Soane, and P. Willman. 1998. “Indi-vidual and Contextual Inﬂuences on the Market Behavior of FinanceProfessionals.” Unpublished manuscript.
7. Svenson, O. 1981. “Are We All less Risky and More Skillful than Our
Fellow Drivers?” Acta Psychologica 47: 143–148.
8. Fischoff, B. 1977. “Perceived Informativeness of Facts.” Journal of Ex-perimental Psychology: Human Perception and Performance 3(2):349–358.
9. Graham, J.R. and Harvey, C.R. 2005. “Expectations, Optimism, andOverconﬁdence.” (April 12). Working Paper. http://icf.som.yale.edu/pdf/seminars04-05/Harvey.pdf.
10. Langer, E. J., and J. Roth. 1975. “Heads I Win, Tails It’s Chance: TheIllusion of Control as a Function of the Sequence of Outcomes in aPurely Chance Task.” Journal of Personality and Social Psychology32: 951–955.
11. Ibid.12. Ibid.13. Fischhoff, B., P. Slovic, and S. Lichtenstein. 1982. “Lay Foibles andExpert Fables in Judgments about Risk.” The American Statistician36(3): 240–255.
14. Hastorf, A. H., D. J. Schneider, and J. Polefka. 1970. Person Perception.
Reading, Mass.: Addison-Wesley.
15. Cooper, A., C. Woo, and W. Dunkelberg. 1988. “Entrepreneurs’ Per-ceived Chances for Success.” Journal of Business Venturing 3: 97–108.
16. Stael von Holstein, C-A. 1972. “Probabilistic forecasting: An Experi-ment Related to the Stock Market.” Organizational Behavior and Hu-man Performance 8: 139–158.
17. Russo, J. E., and P. J. Schoemaker. 1992. “Managing Overconﬁdence.”
Sloan Management Review 33(2): 7–17.
18. Dittrich, D., V. Alexis, W. Guth, and B. Maciejovsky. 2005. “Overconﬁ-dence in Investment Decisions: An Experimental Approach.” EuropeanJournal of Finance 11(6) (December): 471–491.
19. Kahneman, D., and M. W. Riepe. 1998. “Aspects of Investor Psychol-
ogy.” Journal of Portfolio Management 24(4) (Summer): 52–65.
20. See note 15.21. Langer, E. 1975. “The Illusion of Control.” Journal of Personality and
Social Psychology 32: 311–328.
22. Presson, P., and Benassi, V. 1996. “Illusion of Control: A Meta-Analytic Review.” Journal of Social Behavior and Personality 3: 493–510.
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
344
INSIDE THE INVESTOR’S BRAIN
23. McClure, S. M., M. S. Gilzenrat, and J. D. Cohen. 2004. “An Exploration-Exploitation Model Based on Norepinephrine and Dopamine Activity.”Advances in Neural Information Processing Systems 18.
24. Ibid.25. Drobny, S. 2006. Inside the House of Money. Hoboken, N.J.: John
Wiley & Sons, p. 72.
26. Ibid., pp. 76–77.27. Ibid.28. Ibid.29. Ibid., p. 78.30. Schwager, J. 2002. Stock Market Wizards: Interviews with America’s
Top Stock Traders. New York: John Wiley & Sons.
31. Schwager, J. 1992. The New Market Wizards. New York: HarperBusi-
ness, pp. 467–468.
32. Oberlechner, T. 2004. Psychology of the Foreign Exchange Market.
Chichester, England: John Wiley & Sons.
33. Kahn, H., and C. L. Cooper. 1996. “How Foreign Exchange Dealersin the City of London Cope with Occupational Stress.” InternationalJournal of Stress Management 3: 137–145.
34. Bloomﬁeld, R., R. Libby, and M. M. Nelson. 1999. “Conﬁdence and theWelfare of Less-Informed Investors.” Accounting, Organizations andSociety 24: 623–647.
35. Zacharakis, A. L., and D. A. Shepherd. 2001. “The Nature of Informationand Venture Capitalists’ Overconﬁdence. Journal of Business Ventur-ing 16(4): 311–332.
36. Dittrich, D., V. Alexis, W. Guth, and B. Maciejovsky. “Overconﬁdence inInvestment Decisions: An Experimental Approach.” European Journalof Finance 11(6) (December): 471–491.
Chapter 9: Anxiety, Fear, and Nervousness
1. Cramer, J. 2000. “The Game of Calls and Strikes.” TheStreet.com, March
17.
2. Roth, W. T., G. Breivik, P. E. Jorgensen, and S. Hofmann. 1996. “Activa-tion in Novice and Expert Parachutists while Jumping.” Psychophysi-ology 33: 63–72.
3. Monat, A. 1976. “Temporal Uncertainty, Anticipation Time, and Cogni-
tive Coping under Threat.” Journal of Human Stress 2: 32–43.
4. Van Boven, L., G. Loewenstein, D. Dunning, and N. Welch. 2005. “TheIllusion of Courage: Underestimating the Impact of Fear of Embarrass-ment on the Self.” Unpublished manuscript. Described in: Van Boven,L., and G. Loewenstein. 2005. “Cross-Situational Projection.” In Alicke,
notes
JWPR011-Peterson (JWBK010-Peterson)
May 16, 2007
12:8
Char Count=
Notes
345
M., J. Krueger, and D. Dunning (eds.), The Self in Social Judgment.New York: Psychology Press, pp. 43–64.
5. “Abreast of the Market: Industrials Break 7600 and 7700; Polo Ralph
Lauren IPO Surges.” 1997. Wall Street Journal, June 13.
6. Berns, G. S., J. Chappelow, M. Cekic, et al. 2006. “Neurobiological Sub-
strates of Dread.” Science, 312(5774) (May 5): 704–706.
7. Miller, L., K. Taber, G. Gabbard, and R. Hurley. 2005. “Neural Underpin-nings of Fear and Its Modulation: Implications for Anxiety Disorders.”Journal of Neuropsychiatry and Clinical Neuroscience 17:1 (Febru-ary): 1–6.
8. Khan, A., R. L. Kolts, M. H. Rapaport, et al. 2005. “Magnitude of PlaceboResponse and Drug-Placebo Differences across Psychiatric Disorders.”Psychological Medicine 35(5) (May): 743–749.
9. Wager, T. D., J. K. Rilling, E. E. Smith, et al. 2004. “Placebo-InducedChanges in fMRI in the Anticipation and Experience of Pain.” Science303: 1162–1167.
10. Cohen, J. D. 2005. “The Vulcanization of the Human Brain: A NeuralPerspective on Interactions between Cognition and Emotion.” Journalof Economic Perspectives 19: 3–24.
11. Van Boven, L., and G. Loewenstein. 2003. “Social Projection of Tran-sient Drive States.” Personality and Social Psychology Bulletin 29:1159–1168. Described in: Van Boven and Loewenstein, 2005.
Chapter 10: Stress and Burnout
1. Drobny, S. 2006. Inside the House of Money. Hoboken, N.J.: John Wiley
& Sons.
2. Browning, E. S. 2006. “As Stocks Near a High, Pressure Builds for a
Professional Investor.” Wall Street Journal, September 29.
3. Ibid.4. Saraﬁno, E. P. 1998. Health Psychology: Biopsychosocial Interactions,
3rd ed. New York: John Wiley & Sons.
5. Cramer, J. 2000. “Cramer Rewrites ‘The Trading Goddess’ 10 Com-
mandments.” The Street.com, March 11.
6. Ariely, D. 2006. “Large Stakes, Big Mistakes.” Presentation to the Stan-ford Institute of Theoretical Economics, Psychology and EconomicsSession. (August 7, 2006.)
7. Ibid.8. Ibid.9.