You’re pacing the room. A big decision looms—maybe it’s a career move, a major investment, or a life-changing phone call. Your heart’s racing, palms sweating. Logically, this is the time to slow down and think. But instead, something inside you says: Just go for it.
Turns out, that impulse may be hardwired into the human brain.
A new study from the University of Arkansas, published in the journal Psychoneuroendocrinology, reveals how stress shifts our inner calculus. When we’re stressed, we’re significantly more likely to take risks—largely because our brains become less afraid of losing.
The researchers, led by Assistant Professor Grant Shields, dug deep into the psychology of financial decision-making under stress. What they found sheds light on how modern anxiety may hijack ancient survival instincts, pushing us to make bolder, sometimes reckless, choices.
The Vanishing Fear of Loss
At the heart of this behavioral shift is a psychological phenomenon called loss aversion—our tendency to react more strongly to losing something than to gaining it. In normal circumstances, losing $100 feels far worse than winning $100 feels good.
But when we’re under stress, this equation changes.
“Loss aversion declines,” said Shields. “When people are stressed, they’re less sensitive to potential losses. That makes them more likely to take a risk they might normally avoid.”
In other words, stress mutes the emotional sting of failure. And that tilts the mental scales toward gambles we’d otherwise reject.
A Real-Life Lab for Risk
To explore these shifts in decision-making, the research team subjected 147 adult participants to controlled stress conditions and then asked them to make hypothetical financial decisions. These weren’t just random guesses. The choices were meticulously analyzed using cumulative prospect theory, a gold standard in behavioral economics.
Cumulative prospect theory breaks down decision-making into four components:
- Loss aversion (how much we hate to lose)
- Risk aversion (our general caution)
- Probability distortion (why we misjudge the odds)
- Stochasticity (the randomness in our choices)
By analyzing how stress affected each of these components, the researchers uncovered a precise shift: it wasn’t that people under stress suddenly ignored logic altogether. Rather, they calculated the odds differently. They weighed losses less, considered unlikely outcomes more, and became more prone to act rather than hesitate.
“If you’re stressed and trying to decide what to do with your money, you’re not necessarily making irrational choices,” Shields explained. “You’re just using a different kind of logic—one that’s been shaped by your emotional state.”
Stress Affects Men and Women Differently
One of the most fascinating insights from the study was how stress impacts men and women in different ways.
Under stress, women were better at predicting the outcome of their choices, while men were more tuned into the consequences of those outcomes. In short, women anticipated what might happen; men evaluated what it meant.
This difference wasn’t about intelligence or ability—it was about perspective and processing. Shields emphasized that these results aren’t about labeling one gender as “better” at decision-making, but rather about understanding how stress may activate different cognitive strategies.
And while stress reduced loss aversion in all participants, it had a stronger effect on men overall, making their decision-making more volatile when the pressure was on.
The Evolutionary Roots of Risk
Of course, in today’s world, taking financial or personal risks under stress can lead to disaster. But from an evolutionary standpoint, this behavior might have once been a lifesaving advantage.
“If you’re an organism that’s being hunted or chased by another,” said Shields, “then it makes sense to do stuff that you wouldn’t otherwise. Perhaps making a risky decision is better than staying put.”
In high-stress survival situations, action—any action—might increase the odds of escape. A panicked sprint through unfamiliar terrain might lead to safety. Freezing might lead to death. Our modern brains may still carry that ancient wiring, urging bold moves when danger feels near.
The problem? Today’s “threats” are often psychological—deadlines, social pressure, financial worries. And the instinct to take a leap under stress doesn’t always lead to safe ground.
Why This Matters in the Real World
Understanding how stress alters our decision-making isn’t just academic. It’s practical—especially in a world where stress is chronic, and high-stakes choices are everywhere.
From impulsive investments to ill-timed career changes, understanding the neuroscience behind stress and risk can help people make smarter decisions. If we know we’re more prone to take risks under pressure, we can learn to slow down—or at least wait until the storm passes.
“In my own life, if I’m stressed, I’ll wait to make a decision that could have potential loss implications,” said Shields.
It’s advice backed not just by theory, but by hard data.
The Biology Behind the Gamble
What’s happening in the brain during all of this?
When the body is stressed, it releases cortisol, a hormone that helps you deal with immediate threats. But cortisol also changes how the brain evaluates risk and reward. It affects the amygdala, which processes emotions like fear, and the prefrontal cortex, which helps us plan and weigh consequences.
As cortisol levels rise, our brain’s emotional systems become louder, and our logical systems get quieter. Loss feels less scary. Unlikely rewards feel more exciting. The result? A brain that’s less cautious and more daring—sometimes dangerously so.
Betting on Awareness
The message from this research is clear: stress doesn’t make us irrational. It makes us differently rational.
It tweaks the mental formulas we use to evaluate the world, giving more weight to action over caution, chance over certainty. And in some situations, that can be useful—even lifesaving. But in the modern world, where most threats are long-term and complex, this ancient strategy can backfire.
By understanding how stress nudges us toward risk, we can learn to hit pause, check our instincts, and make more mindful decisions—especially when the stakes are high.
So the next time you feel pressure rising and a bold idea flashes across your mind, take a breath. You might be hearing the voice of your ancestors—the ones who ran, fought, survived, and dared. But now, you have the data. You have the choice.
Reference: Grant S. Shields et al, Acute stress differentially influences risky decision-making processes by sex: A hierarchical bayesian analysis, Psychoneuroendocrinology (2024). DOI: 10.1016/j.psyneuen.2024.107259
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