The Marshmallow Experiment and implications for
Investors
The Experiment
The Marshmallow Experiment is a famous
psychological study conducted by psychologist Walter Mischel in the late 1960s
and early 1970s at Stanford University. The experiment was designed to explore
children's self-control and the ability to delay gratification.
The experiment involved placing a child in a
room with a marshmallow or a similar treat, such as a cookie or pretzel stick on
a table, and offering them a choice. The child was given two options: they
could eat the marshmallow immediately, or if they waited for a short period,
typically around 15 minutes, without eating it.
The experimenter would leave the room, and a hidden camera recorded the
child's behaviour. If they successfully resisted the temptation and waited,
they would be rewarded with an additional treat when the experimenter returned.
The results of the experiment showed
interesting variations in the children's behaviour. Some children couldn't
resist the temptation and ate the marshmallow almost immediately. Others tried
various strategies to distract themselves from eating it, such as covering
their eyes, singing, or fidgeting. A few children managed to delay
gratification and received the second marshmallow.
What made the Marshmallow Experiment
particularly significant was the follow-up research that Mischel and his
colleagues conducted. Mischel and his colleagues followed up with the
participants years later and found that those who were able to wait longer as
children tended to have better life outcomes, such as higher SAT scores,
educational attainment, overall self-control, and even health outcomes later in
life.
The Marshmallow Experiment has been widely
interpreted as an exploration of the concept of self-control and the ability to
delay immediate rewards for greater long-term benefits. It highlights the
importance of impulse control and the ability to resist instant gratification,
as these skills can have a significant impact on personal and professional
success.
However, it's worth noting that the
Marshmallow Experiment has also faced some criticism over the years. Some argue
that the study may be influenced by socioeconomic factors, cultural
differences, or other variables not fully accounted for in the original
research.
Nevertheless, the Marshmallow Experiment
remains an iconic study that has sparked ongoing research and discussion about
self-control, delayed gratification, and their implications for human behaviour
and achievement.
The Young Millionaire
The implications of the Marshmallow Experiment for investors
The implications of the Marshmallow Experiment for investors lie in the broader concept of delayed gratification and its correlation with long-term investment success.
Here are a few key
takeaways:
#1.
Patience and Self-Control:
#2.
Time Horizon:
#3.
Long-Term Thinking:
#4.
Discipline and Emotional Control:
#5.
Risk-Reward Trade-off:
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