Why The Rich Get Richer

... (and the Smart Get Smarter)

This old saying also has a corollary: the poor get poorer (at least relative to the rich). Of course there are exceptions, but these correlations happen often enough to indicate there is some truth to the saying. I never heard anybody explain this, other than to conclude that life is just unfair. But there is an explanation.

The reason is that the rich learn from their successes, while the poor, who don’t have many successes, fail to learn from their failures. And the reason for that is that the human brain is wired to learn better from success than from failure. It all has to do with the positive reward system in the brain. Practically speaking, the most obvious example is how animals are trained for circus performances, how dogs are trained to sniff out drugs or corpses, and the like. Positive reinforcement when they do things right promotes learning more effectively and faster than punishing them when they do things wrong. Apparently, the same principle holds for people.

A report of a study of nerve cell activity in monkeys showed sustained, persistent outcome-related responses in both prefrontal cortex and in the basal ganglia, areas known to participate in learning stimulus-response associations. These neurons keep track of successes and failures over many seconds, which is long enough to form a semi-permanent memory that can affect the response the next time such a learning opportunity arises. The neural response improves after a recent success, but doesn’t improve as much after a recent failure. Not surprisingly, monkeys that were rewarded for the right resonse to a cue learned quickly how to respond the next time they saw the cue. But monkeys that responded incorrectly weren’t any better able to deal with the same cue the next time they saw it.

The authors speculate that successes are more informative than failures. When you fail, you typically already know why and there is not much new to learn. Why then do we keep making the same mistakes? I suspect that habit and emotional factors have a lot to do with it. Compulsive gambling and drug abuse are classic examples of repeatedly doing what you already know is wrong. I remember when I tried many times to quit smoking I only succeeded long term when I took up jogging, which is accompanied by the positive reinforcement of endorphins.

I also suspect that a major reason you learn more from success than from failure is the power of the brain’s dopaminergic and endorphin reward systems. Not only does positive reinforcement feel better emotionally than punishment, there is a real possibility that the dopamine release associated with reward has a direct biological influence on memory formation.

Source:
Histed, M. H., Pasupathy, A., and Miller, E. K. 2009. Learning substrates in the primate prefrontal cortex and striatum: sustained activity related to successful actions. Neuron. 63 (2): 244-253.