An article appearing in Science Magazine, “The End of History Illusion” by Quoidbach, Gilbert, and Wilson (1), inspired me to write this post; I believe it somehow connects with a favourite of mine, English liberal philosophy.
John Locke, who maintained that we are always moved by the desire for our own happiness or pleasure, recognised that we value present pleasure more than future pleasure, and
pleasure in the near future more than pleasure in the distant future. As Bertrand Russell puts it “If the prospect of spending £1000 a year hence were as delightful as the thought of spending it today, I should not need to be paid for postponing my pleasure”.
As pleasures lose their attractiveness and pains their terrors in proportion to their distance in the future, Locke thought that we should be guided by our long run interests; otherwise we may -for example- put off going to the dentist longer than it would be rational. Locke -a good protestant- upheld Prudence as the highest virtue. Most of us are generally prudent and save for the future. But how prudent should we be? And to what extend should we save for what?
The article by Quoidbach et al. provides helpful advice, warning that what we may think we will value the most in the future may not be as attractive as we thought it would once we get there.
After surveying -using well-thought tests*, not simply asking- more than 19000 people aged between 18 and 68, Quoidbach et al. found that subjects believed they have changed a lot in the past but that they will change very little in the future. This belief has major implication in the way we invest. In a cleverly devised experiment they separated participants into two groups, asking group A to estimate how much they would spend today to attend a concert of a band they liked 10 years ago and asking group B how much they would pay today for attending a concert of their current favourite band in 10 years time. The authors found that people would spend 61% more today to see their current favourite band in 10 years time than for attending a concert of their old favourite band in the present.
This work shows that people, despite knowing that they have changed a lot in the past believe they will change very little in the future. This misconception -that Quoidbach et al. call “the end of history illusion”- leads people to make misguided investment decisions.
Thus, prudence remains the highest virtue and we ought to value distant pleasures more than presents, but considerable thought needs to be employed in determining what will be most pleasurable in the distant future.
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* For example, they designed tests to measure participants’ personalities (conscientiousness, agreeableness, emotional stability, openness to experience, and extraversion) and asked them to fill the tests in as they feel in the present or as they thought they felt in the past or would feel in the future.
(1) Science (2013) vol. 339 p96-98