Damasio formulated the somatic marker hypothesis (SMH), that proposes a mechanism by which emotional processes can guide (or bias) behavior, particularly decision-making.
[6] Generally, it is the contemplation of incremental losses or gains that generates anticipated emotions in decision-makers, as opposed to their overall condition.
[8] The somatic marker hypothesis (SMH), formulated by Antonio Damasio, proposes a mechanism by which emotional processes can guide (or bias) behavior, particularly decision-making.
[11] Physiological changes (e.g., muscle tone, heart rate, endocrine release, posture, facial expression, etc.)
When making decisions, these physiological signals (or ‘somatic markers’) and their evoked emotion are consciously or unconsciously associated with their past outcomes and bias decision-making towards certain behaviors while avoiding others.
[11] For instance, when a somatic marker associated with a positive outcome is perceived, the person may feel happy and motivated to pursue that behavior.
When a somatic marker associated with the negative outcome is perceived, the person may feel sad and the emotion may act as an internal alarm to warn the individual to avoid a course of action.
These situation-specific somatic states based on, and reinforced by, past experiences help to guide behavior in favor of more advantageous choices and therefore are adaptive.
In the second pathway, cognitive representations of the emotions can be activated in the brain without being directly elicited by a physiological response—called the "as-if body loop".
For instance, imagining an encounter with a snake would initiate a similar flight-or-fight response "as-if" you were in that particular situation (albeit perhaps a much weaker one).
In other words, the brain can anticipate expected bodily changes, which allows the individual to respond faster to external stimuli without waiting for an event to actually occur.
Research done by Isen and Patrick put forth the theory of "mood maintenance" which states that happy decision-makers are reluctant to gamble.
The mood someone has works as "a retrieval cue" whereby happy feelings make positive materials come to mind which in turn have great impact on the decisions that are made.