Under Pressure - Money Matters

Different people react differently to pressure - some crack, some thrive. But research indicates that if things matter too much, then performance suffers. The undercover economist wrote an excellent article on this subject today.

The researchers offered simple challenges to impoverished villagers in India. If the incentive was an average day's income then the performance was significantly better than if the incentive was equivalent to six months of income. With such enormous life-changing amounts, the pressure was just too much. Even using rich professional footballers instead of poor Indian villagers as lab rats, the basic conclusion is the same.

That sounds obvious. But remember The Apprentice, where every other candidate seemed to say "I want this more than anyone", and I ridiculed the phrase, saying no serious businessman should be taken in by that bullshit. Well the research would seem to suggest that those who want it the most are those whose performance drops the most. So perhaps, in the really big crunch situations, other factors being equal, those who are already financially secure, or at least those who have the most outside opportunities, will perform significantly better than those for whom the result really matters.