29,078 research outputs found

    Neuroeconomics: How Neuroscience Can Inform Economics

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    Neuroeconomics uses knowledge about brain mechanisms to inform economic analysis, and roots economics in biology. It opens up the "black box" of the brain, much as organizational economics adds detail to the theory of the firm. Neuroscientists use many tools— including brain imaging, behavior of patients with localized brain lesions, animal behavior, and recording single neuron activity. The key insight for economics is that the brain is composed of multiple systems which interact. Controlled systems ("executive function") interrupt automatic ones. Emotions and cognition both guide decisions. Just as prices and allocations emerge from the interaction of two processes—supply and demand— individual decisions can be modeled as the result of two (or more) processes interacting. Indeed, "dual-process" models of this sort are better rooted in neuroscientific fact, and more empirically accurate, than single-process models (such as utility-maximization). We discuss how brain evidence complicates standard assumptions about basic preference, to include homeostasis and other kinds of state-dependence. We also discuss applications to intertemporal choice, risk and decision making, and game theory. Intertemporal choice appears to be domain-specific and heavily influenced by emotion. The simplified ß-d of quasi-hyperbolic discounting is supported by activation in distinct regions of limbic and cortical systems. In risky decision, imaging data tentatively support the idea that gains and losses are coded separately, and that ambiguity is distinct from risk, because it activates fear and discomfort regions. (Ironically, lesion patients who do not receive fear signals in prefrontal cortex are "rationally" neutral toward ambiguity.) Game theory studies show the effect of brain regions implicated in "theory of mind", correlates of strategic skill, and effects of hormones and other biological variables. Finally, economics can contribute to neuroscience because simple rational-choice models are useful for understanding highly-evolved behavior like motor actions that earn rewards, and Bayesian integration of sensorimotor information

    Another cartoon portrait of the mind from the reductionist metaphysicians--a review of Peter Carruthers ‘The Opacity of Mind’ (2011) (review revised 2019)

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    Materialism, reductionism, behaviorism, functionalism, dynamic systems theory and computationalism are popular views, but they were shown by Wittgenstein to be incoherent. The study of behavior encompasses all of human life, but behavior is largely automatic and unconscious and even the conscious part, mostly expressed in language (which Wittgenstein equates with the mind), is not perspicuous, so it is critical to have a framework which Searle calls the Logical Structure of Rationality (LSR) and I call the Descriptive Psychology of Higher Order Thought (DPHOT). After summarizing the framework worked out by Wittgenstein and Searle, as extended by modern reasoning research, I show the inadequacies in Carruther’s views, which pervade most discussions of behavior, including contemporary behavioral sciences. I maintain that his book is an amalgam of two books, one a summary of cognitive psychology and the other a summary of the standard philosophical confusions on the mind with some new jargon added. I suggest that the latter should be regarded as incoherent or as a cartoon view of life and that taking Wittgenstein at his word, we can practice successful self therapy by regarding the mind/body issue as a language/body issue. Those wishing a comprehensive up to date framework for human behavior from the modern two systems view may consult my book ‘The Logical Structure of Philosophy, Psychology, Mind and Language in Ludwig Wittgenstein and John Searle’ 2nd ed (2019). Those interested in more of my writings may see ‘Talking Monkeys--Philosophy, Psychology, Science, Religion and Politics on a Doomed Planet--Articles and Reviews 2006-2019 3rd ed (2019), The Logical Structure of Human Behavior (2019), and Suicidal Utopian Delusions in the 21st Century 4th ed (2019

    Cognitive Biases and Gaze Direction: An Experimental Study

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    This paper investigates the validity of the model of dual processing by means of eyetracking methods. In this theoretical framework, gaze direction may be a revealing signal of how automatic detection is modified or sustained by controlled search. We performed an experiment by using a stylized decisional framework, i.e. informational cascade, proposed by economists to investigate the rationality of imitative behavior. Our main result is that automatic detection as revealed by gaze direction is driven by mechanisms that are dependent on cognitive biases. In particular, we find significant statistical correlation between subjects’ first fixation and their revealed patterns of choice. Our findings support the hypothesis that the process of automatic detection is not independent on cognitive processes.informational cascades, overconfidence, eye-tracking, information processing, cognitive biases

    "Monsters on the Brain: An Evolutionary Epistemology of Horror"

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    The article discusses the evolutionary development of horror and fear in animals and humans, including in regard to cognition and physiological aspects of the brain. An overview of the social aspects of emotions, including the role that emotions play in interpersonal relations and the role that empathy plays in humans' ethics, is provided. An overview of the psychological aspects of monsters, including humans' simultaneous repulsion and interest in horror films that depict monsters, is also provided

    The influence of affect on attitude

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    Priests of the medieval Catholic Church understood something about the relationship between affect and attitude. To instill the proper attitude in parishioners, priests dramatized the power of liturgy to save them from Hell in a service in which the experience of darkness and fear gave way to light and familiar liturgy. These ceremonies “were written and performed so as to first arouse and then allay anxieties and fears ” (Scott, 2003, p. 227): The service usually began in the dark of night with the gothic cathedral’s nave filled with worship-pers cast into total darkness. Terrifying noises, wailing, shrieks, screams, and clanging of metal mimicked the chaos of hell, giving frightened witnesses a taste of what they could expect if they were tempted to stray. After a prolonged period of this imitation of hell, the cathedral’s interior gradually became filled with the blaze of a thousand lights. As the gloom diminished, cacophony was supplanted by the measured tones of Gregorian chants and polyphony. Light and divine order replaced darkness and chaos (R. Scott, personal correspondence, March 15, 2004). This ceremony was designed to buttress beliefs by experience and to transfigure abstractions into attitudes. In place of merely hearing about “the chaos and perdition of hell that regular performances of liturgy were designed to hold in check ” (Scott, 2003), parishioners shoul

    Large-scale Hierarchical Alignment for Data-driven Text Rewriting

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    We propose a simple unsupervised method for extracting pseudo-parallel monolingual sentence pairs from comparable corpora representative of two different text styles, such as news articles and scientific papers. Our approach does not require a seed parallel corpus, but instead relies solely on hierarchical search over pre-trained embeddings of documents and sentences. We demonstrate the effectiveness of our method through automatic and extrinsic evaluation on text simplification from the normal to the Simple Wikipedia. We show that pseudo-parallel sentences extracted with our method not only supplement existing parallel data, but can even lead to competitive performance on their own.Comment: RANLP 201

    Animal Spirits: Affective and Deliberative Processes in Economic Behavior

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    The economic conception of human behavior assumes that a person has a single set of well-defined goals, and that the person's behavior is chosen to best achieve those goals. We develop a model in which a person's behavior is the outcome of an interaction between two systems: a deliberative system that assesses options with a broad, goal-based perspective, and an affective system that encompasses emotions and motivational drives. Our model provides a framework for understanding many departures from full rationality discussed in the behavioral-economics literature, and captures the familiar feeling of being "of two minds." And by focusing on factors that moderate the relative influence of the two systems, our model also generates a variety of novel testable predictions.

    Good policies for bad governments: behavioral political economy

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    Politicians and policymakers are prone to the same biases as private citizens. Even if politicians are rational, little suggests that they have altruistic interests. Such concerns lead us to be wary of proposals that rely on benign governments to implement interventionist policies that "protect us from ourselves." The authors recommend paternalism that recognizes both the promise and threat of activist government. They support interventions that channel behavior without taking away consumers' ability to choose for themselves. Such "benign paternalism" can lead to very dramatic behavioral changes. But benign paternalism does not give government true authority to control our lives and does not give private agents an incentive to reject such authority through black markets and other corrosive violations of the rule of law. The authors discuss five examples of policy interventions that will generate significant welfare gains without reducing consumer liberties. They believe that all policy proposals should be viewed with healthy skepticism. No doctor would prescribe a drug that only worked in theory. Likewise, economic policies should be tested with small-scale field experiments before they are adopted.Macroeconomics ; Economics ; Economic policy

    (WP 2016-03) Economics, Neuroeconomics, and the Problem of Identity

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    This paper reviews the debate in economics over neuroeconomics’ contribution to economics. It distinguishes majority and minority views, argues that this debate has been framed by mainstream economics’ conception of itself as an isolated science, and argues that this framing has put off the agenda in economics issues such as individual identity that are increasingly important in connection with the social and historical context of economic explanations in a changing complex world. The paper first discusses how the debate over neuroeconomics has been limited to the question of what information from other sciences might be employed in economics. It then goes on to the individual identity issue, and discusses how economics’ top-down, closed character generates a circular individual identity conception, while bottom-up, open character of psychology and neuroscience, and their continual concern with the changing relation between theory and evidence, has produced four competing individual identity conceptions in neuroeconomic research

    Neuroeconomics: Using Neuroscience to Make Economic Predictions

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    Neuroeconomics seeks to ground economic theory in detailed neural mechanisms which are expressed mathematically and make behavioural predictions. One finding is that simple kinds of economising for life-and-death decisions (food, sex and danger) do occur in the brain as rational theories assume. Another set of findings appears to support the neural basis of constructs posited in behavioural economics, such as a preference for immediacy and nonlinear weighting of small and large probabilities. A third direction shows how understanding neural circuitry permits predictions and causal experiments which show state-dependence of revealed preference – except that states are biological and neural variables
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