Men Can Be So Hormonal Sometimes
Despite BBC’s reputation as a Serious News Site, there’s often fun to be had when you find on their respectable front page a headline like Why male sex hormones may be fueling market turmoil. I was hoping for more salacious Spitzer stories but instead found a scientific piece blaming testosterone for various economic woes:
Hormone surges among City traders could be partly responsible for driving "boom and bust" economics, say researchers.
team found testosterone levels were directly linked to the profit they made .... They found that daily testosterone levels were significantly higher on days when traders made more than their average profit. Cambridge University
They ascribe this to the "winner effect", seen in sportsmen, in which success increases testosterone levels, which in turn increase feelings of confidence and ability to take risks, which then increase the chances of further profits.
However, if repeated too much, they say, the rising testosterone levels could eventually compromise their ability to make rational decisions, as the traders take bigger and bigger risks during so-called "bubbles", where the market rises sharply.
There’s about a thousand comments I could make on how boom-and-bust cycles would vary if women were the majority of the world’s stock traders, but they’d all be very crass and I’m trying to play the respectable card these days, what with the whole jobquest thing. What's worse is, I suspect that both my jokes and this article's serious thesis are both entirely true. How many more millennia before our ancient reptilian brains devolve away and we can make serious progress? Enough to ensure it won't be in my lifetime, too bad.