NeuroEconomics

Over the last two years a research field has developed under the banner of 'neuroeconomics' in which recent neuroscientific methods are deploid to analyze economically relevant processes. This paper aims to provide an overview of the methodology and current state of neuroeconomic research by giving a brief definition of the concept of neuroeconomics, outlining relevant methodologies, and describing studies undertaken in the current research areas to date. Finally, some future prospects are considered.

Appetitive and Aversive Goal Values Are Encoded in the Medial Orbitofrontal Cortex at the Time of Decision Making

An essential feature of choice is the assignment of goal values (GVs) to the different options under consideration at the time of decision making. This computation is done when choosing among appetitive and aversive items. Several groups have studied the location of GV computations for appetitive stimuli, but the problem of valuation in aversive contexts at the time of decision making has been ignored. Thus, although dissociations between appetitive and aversive components of value signals have been shown in other domains such as anticipatory and outcome values, it is not known whether appetitive and aversive GVs are computed in similar brain regions or in separate ones. We investigated this question using two different functional magnetic resonance imaging studies while human subjects placed real bids in an economic auction for the right to eat/avoid eating liked/disliked foods. We found that activity in a common area of the medial orbitofrontal cortex and the dorsolateral prefrontal cortex correlated with both appetitive and aversive GVs. These findings suggest that these regions might form part of a common network

Neural correlates of the affect heuristic during brand choice

In this working paper it is investigated how affect and cognition interact in consumer decision making. The research framework is multidisciplinary by applying a neuroscientific method to answer the question which information is processed during brand choice immediately when the decision is computed in the test person’s brain. In a neuroscientific experiment test persons perform binary decision-making tasks between different brands of the same product class. The results suggest that the presence of the respondent’s first choice brand leads to a specific modulation of the neural brain activity, which can be described as neural correlate of Slovic’s affect heuristic concept.Neuroeconomics, brand choice, cognition, affect

Context-dependency in valuation

In the last few years, work in the nascent field of neuroeconomics has advanced understanding of the brain systems involved in value-based decision making. An important modulator of valuation processes is the specific context a decision maker is facing during choice. Recently, neuroeconomics has made great progress in understanding, on both the brain and behavioral level, how context-dependent perception affects valuation and choice. Here we describe how context-sensitive value coding accounts for choice set effects, differential perceptions of gains and losses, and expectancy effects of external (economic) signals

Cognitive Regulation during Decision Making Shifts Behavioral Control between Ventromedial and Dorsolateral Prefrontal Value Systems

Cognitive regulation is often used to influence behavioral outcomes. However, the computational and neurobiological mechanisms by which it affects behavior remain unknown. We studied this issue using an fMRI task in which human participants used cognitive regulation to upregulate and downregulate their cravings for foods at the time of choice. We found that activity in both ventromedial prefrontal cortex (vmPFC) and dorsolateral prefrontal cortex (dlPFC) correlated with value. We also found evidence that two distinct regulatory mechanisms were at work: value modulation, which operates by changing the values assigned to foods in vmPFC and dlPFC at the time of choice, and behavioral control modulation, which operates by changing the relative influence of the vmPFC and dlPFC value signals on the action selection process used to make choices. In particular, during downregulation, activation decreased in the value-sensitive region of dlPFC (indicating value modulation) but not in vmPFC, and the relative contribution of the two value signals to behavior shifted toward the dlPFC (indicating behavioral control modulation). The opposite pattern was observed during upregulation: activation increased in vmPFC but not dlPFC, and the relative contribution to behavior shifted toward the vmPFC. Finally, ventrolateral PFC and posterior parietal cortex were more active during both upregulation and downregulation, and were functionally connected with vmPFC and dlPFC during cognitive regulation, which suggests that they help to implement the changes to the decision-making circuitry generated by cognitive regulation

Orbitofrontal Cortex Encodes Willingness to Pay in Everyday Economic Transactions

An essential component of every economic transaction is a willingness-to-pay (WTP) computation in which buyers calculate the maximum amount of financial resources that they are willing to give up in exchange for the object being sold. Despite its pervasiveness, little is known about how the brain makes this computation. We investigated the neural basis of the WTP computation by scanning hungry subjects' brains using functional magnetic resonance imaging while they placed real bids for the right to eat different foods. We found that activity in the medial orbitofrontal cortex and in the dorsolateral prefrontal cortex encodes subjects' WTP for the items. Our results support the hypothesis that the medial orbitofrontal cortex encodes the value of goals in decision making

Dissociating valuation and saliency signals during decision-making.

There is a growing consensus that the brain computes value and saliency-like signals at the time of decision-making. Value signals are essential for making choices. Saliency signals are related to motivation, attention, and arousal. Unfortunately, an unequivocal characterization of the areas involved in these 2 distinct sets of processes is made difficult by the fact that, in most experiments, both types of signals are highly correlated. We dissociated value and saliency signals using a novel human functional magnetic resonance imaging decision-making task. Activity in the medial orbitofrontal, rostral anterior cingulate, and posterior cingulate cortices was modulated by value but not saliency. The opposite was true for dorsal anterior cingulate, supplementary motor area, insula, and the precentral and fusiform gyri. Only the ventral striatum and the cuneus were modulated by both value and saliency