Why some people take risks and some dont - Research Paper Example

?Why some people take risks and some don’t People vary in their tendency to take risks. People that take risks in any aspect of their life are ambitious. Ambition keeps an individual moving forward in search of better opportunities. Ambitious people want to be successful in whatever they are doing. They establish goals for themselves and started working toward achieving those goals. In the way, if they encounter a risky situation, they tend to take the risk rather than retreating from it because they do not want to compromise upon their plans. However, they undertake risks with a planned strategy so that they are able to mitigate the risks in case they encounter them. Such people are highly motivated. Motivation is one of the key drivers of the tendency to undertake risks. Motivated people cannot feel comfortable if they retreat from entering a risky situation, if that is what it takes to achieve their goal. A very important characteristic feature of the pro-risk people is that they are optimistic. A pessimistic person places too much emphasis over the possibilities of negative outcomes of a risk and thus feels discouraged to undertake it. People generally are not very optimistic about risks. Daniel Kaheman who has won Nobel Prize explained how the fear of loss is bigger for most people compared to the happiness of gain in these words, “For most people, the fear of losing $100 is more intense than the hope of gaining $150. [Amos Tversky and I] concluded from many such observations that ‘losses loom larger than gains’ and that people are loss averse” (Kaheman cited in Halvorson). On the other hand, an optimistic person thinks more over the ways in which the outcomes of risk might impact the life positively. People that take risks have a drive to achieve more. Pro-risk people have the resources to manage the negative outcomes of a risk. It is insanity to undertake a risk putting everything one has on stake whereas if a person has surplus resources that they can compromise on in case the outcomes of the risk do not turn out to be favorable, they would not mind taking a chance. People that take risks are brave. Even those that seem to be the most daring of all have legitimate fears (Abel) but their courage and bravery lets them outweigh their fears and be successful. Taking risk is related to self-actualization. Self-actualization sits at the top of the pyramid proposed by Maslow in his motivational theory, and can be described as the realization of the potential in an individual to fulfill themselves and make optimal use of their capabilities (Maslow 150). Why an individual takes a risk is explained by Maslow’s hierarchy of needs theory. Maslow categorized all sorts of needs an individual might have into five basic kinds of needs, namely physiological needs, safety needs, love and belongingness needs, self-esteem needs, and the need of self-actualization (Cherry). Maslow placed these needs on top of each other in the form of a pyramid with the physiological needs forming the base and the need to self-actualize at the top. According to Maslow, an individual does not feel a higher level need unless all lower level needs are satisfied. Hence, a person would only feel the need for love and belongingness if their safety needs are addressed. Taking this philosophy, an individual only feels the need to self-actualize when all lower level needs have been addressed. Self-actualization is when an individual takes incentives in order to grow and progress, take chances, as well as risks. Describing the attitude and approach of a self-actualized person, (Wilson) says that such people approach life with newness and even appreciate the experiences they have already had treating them as new. In view of the Maslow’s hierarchy of needs theory, people that take risks in any aspect of their life have all their basic needs addressed. This suggests that they are capable of taking risks financially, mentally, emotionally, and physically. There are a range of factors that may stop a person from being adventurous. These factors include but are not limited to age, previous life experiences, culture, responsibilities, and resources. Age is one of the most important determinants of the tendency of an individual to be adventurous. Young people are more energetic, full of enthusiasm, and ambitious to move forward in life. Since they have just started their journey, they can often go to any lengths to make their dreams come true. They know that they have the time of a whole life ahead, energy, will power, and determination. These qualities help them remain motivated to undergo the adventure. Besides, the fundamental nature of adventure appeals to young blood more than it does to the old blood. On the other hand, old people lack that energy, enthusiasm, and motivation to undertake adventures. Professional risk takers become experienced over the passage of time (Bain and Carson 200). Young people have lesser life experiences than old people to really know the cost they might have to pay if the adventure turns out to be a failure. This is another reason why old people tend to be more critical of undertaking adventure than young people. Culture determines an individual’s tendency to be adventurous. People belonging to a certain culture usually establish their ideals from the very culture. Since the stimuli that people are exposed to play a decisive role in determining their behavior (Patterson), people of the same culture often think similarly, and evaluate the pros and cons of undertaking adventure similarly. People with more responsibilities cannot afford to be as adventurous as people with less responsibilities. For example, an employed and married person who has his children studying in schools in the region is less likely to go for immigration to another country than a bachelor. While the former has to think about all the different sorts of factors including accommodation, job, schooling of children, and bearing the expenses of the whole family, the latter just has to think about himself. Resources are understandably a major determinant of the tendency of an individual to be adventurous. For example, one can only opt for immigration if one has the money to pay the fees, travelling expenses, and accommodation abroad. A person who is already in debt and hardly manages to afford the basic necessities of life cannot go for immigration. Some people think of being adventurous as being foolish, ignoring the clear divide between the two terms. The line between being adventurous and being foolish characterizes the former as sanity and the latter as insanity. While being foolish is absolute insanity and one should never go for that, being adventurous is, many a times, actually the right course of action, and one should opt for being adventurous provided one has done necessary homework for that. Being adventurous means being motivated to experience something new, exciting, and terrific in life. Man by nature wants change. Irrespective of how great an individual is doing, if they have to catch up with the same routine for extended period of time, things start to lose their charm. Man by nature wants to progress and move forward and the upper limit to which one can move is never established. An adventurous individual is motivated to bring that wanted change. To achieve that, the individual critically analyzes whether the goal is worth trying for, what are the pros and cons of trying and not trying to achieve that goal, what value would be added to life if the goal is attained and what would be compromised. Only after an in-depth analysis of all these aspects does a person go for adventure. The most fundamental difference between being adventurous and being foolish is that an adventurous person knows what they are doing whereas a foolish person does not actually know what they are doing. Successful risk management is a process-oriented focus and requires the risk taker to analyze the possible risks and strategies of mitigation while undertaking the adventure (Lopez and Slepitza 1). A foolish person might also be motivated to bring a change, but they do not evaluate the pros and cons of adopting the alternative courses of action. Hence, they make uninformed decisions and more often than not, land themselves in difficulties. While a foolish person is quite vulnerable to failures and disasters, an adventurous person has worked out strategies to mitigate the risks, if encountered. Concluding, the tendency to take risks varies from case to case. Pro-risk people are ambitious, strategic, motivated, optimistic, resourceful, and brave. People lacking these qualities or with unfavorable past experiences are risk averse. Self-actualized people take risks because their other needs are satisfied. Factors that stop people from being adventurous include age, previous life experiences, culture, responsibilities, and resources. Being adventurous is sanity whereas being foolish is insanity. Being adventurous comes with a sense of the possible dangers lying ahead and a planning to mitigate the involved risks if they are encountered whereas being foolish comes with a lack of sense or awareness of the possible dangers involved and increases the individual’s vulnerability to losses and failures. Works Cited: Abel, Georgie. “Why we need adventure.” 2013. Web. 9 Dec. 2013. . Bain, Andy, and Carson, David. Professional Risk and Working with People: Decision-Making in Health, Social Care and Criminal Justice. Jessica Kingsley Publishers, 2008. Print. Cherry, Kendra. “Hierarchy of Needs.” 2013. Web. 9 Dec. 2013. . Halvorson, Heidi Grant. “The Hidden Danger of Being Risk-Averse.” Harvard Business Review. 2 July 2013. Web. 9 Dec. 2013. . Lopez, Michael, and Slepitza, Molly. “The Art of Risk Management: Characteristics of Successful Risk Managers.” Sep. 2011. Web. 9 Dec. 2013. . Maslow, A. H. Motivation and Personality. New York: Harper, 1954. Print. Patterson, C. H. “The nature of self-actualization.” N.d. Web. 9 Dec. 2013. . Wilson, C. Voyage to a beginning: A Preliminary Autobiography. London: Cecil and Amelia Woolf, 1969. Print. Read More