1. Introduction
The recent financial and subsequent economic crisis has fuelled the discussion in economics regarding the rationality of
financial markets and investment behavior. Instead of cold calculations, emotions like greed and fear are often referred to as
motivational factors in debates about the crisis. The ‘‘animal spirits’’ that Keynes alluded to when he discussed the role of
expectations in investment in his General Theory are back in business (see Akerlof & Schiller, 2009; Greenspan, 2008). In this
paper, we will investigate the role of emotions in risk taking in a much simpler but controlled setting, focusing on the time it
takes for risks to materialize.
Whenever we take a risk time passes between the decision to take the risk and the resolution of that risk. This time can be
very short, as with on-the-spot lotteries, but it can also be very long, like in research for new drugs. Other examples can be
found when looking at decisions concerning medical examinations or health and safety related activities. In mainstream economics
this time dimension has received little attention. Only planning motives related to consumption smoothing facilitated
by prior knowledge of outcomes have been considered