Social Influence and Individual Difference in Experimental Juries

In a jury decision-making, individuals must compromise in order to reach a group consensus. If individuals compromise for non-rational reasons, such as a preference for conformity or due to erroneous information, then the final decision of the group may be biased. This paper presents original experimental data which shows that groups do have a significant tendency to compromise in jury-like settings. Econometric evidence also shows that features of groups, including the generosity of the group overall, will dictate the extent of compromise. The data also reveal that individual traits such as gender and capacity for empathy are associated with the extent of compromise in a jury-type setting. The implications are that interactions between individual and group characteristics limit the objectivity of decision-making

Herding and Social Pressure in Trading Tasks: A Behavioural Analysis

We extend the experimental literature on Bayesian herding using evidence from a financial decision-making experiment. We identify significant propensities to herd increasing with the degree of herd-consensus. We test various herding models to capture the differential impacts of Bayesian-style thinking versus behavioural factors. We find statistically significant associations between herding and individual characteristics such as age and personality traits. Overall, our evidence is consistent with explanations of herding as the outcome of social and behavioural factors. Suggestions for further research are outlined and include verifying these findings and identifying the neurological correlates of propensities to herd

Herding in Financial Behaviour

Experimental analyses have identified significant tendencies for individuals to follow herd decisions, a finding which has been explained using Bayesian principles. This paper outlines the results from a herding task designed to extend these analyses using evidence from a functional magnetic resonance imaging (fMRI) study. Empirically, we estimate logistic functions using panel estimation techniques to quantify the impact of herd decisions on individuals' financial decisions. We confirm that there are statistically significant propensities to herd and that social information about others' decisions has an impact on individuals' decisions. We extend these findings by identifying associations between herding propensities and individual characteristics including gender, age and various personality traits. In addition fMRI evidence shows that individual differences correlate strongly with activations in the amygdala ﾖ an area of the brain commonly associated with social decision-making. Individual differences also correlate strongly with amygdala activations during herding decisions. These findings are used to construct a two stage least squares model of financial herding which confirms that individual differences and neural responses play a role in modulating the propensity to herd

The problem of land value betterment ::a simplified agent-based test

In this paper, we employ behaviour-driven cellular automata as a simplified agent-based modelling approach to test the seminal Coase theorem, with a policy focus on the land value betterment effect of urban infrastructure provision. Four prototypical development regimes are identified from international practice: (1) the private developer-oriented Metroland model dating back to the suburbanisation of London in the nineteenth century England; (2) the private household-led special district model, which can be observed in many contemporary US suburbs; (3) the public planning-regulated model, as featured in most post-war European welfare state countries, including the present-day UK; (4) the public state-as-developer model, which characterises what has been taking place in China. A repeated analysis of variance (ANOVA) based on the results of a large number of cellular automata simulations suggests no significant difference between models I and II in terms of their welfare outcomes measured by aggregate utility. However, models III and IV are both found to generate significantly less welfare than models I and II, under strict assumptions of zero transaction costs, perfect information, perfect capital markets and perfect competition

Partial Adaptation of Obtained and Observed Value Signals Preserves Information about Gains and Losses.

UNLABELLED: Given that the range of rewarding and punishing outcomes of actions is large but neural coding capacity is limited, efficient processing of outcomes by the brain is necessary. One mechanism to increase efficiency is to rescale neural output to the range of outcomes expected in the current context, and process only experienced deviations from this expectation. However, this mechanism comes at the cost of not being able to discriminate between unexpectedly low losses when times are bad versus unexpectedly high gains when times are good. Thus, too much adaptation would result in disregarding information about the nature and absolute magnitude of outcomes, preventing learning about the longer-term value structure of the environment. Here we investigate the degree of adaptation in outcome coding brain regions in humans, for directly experienced outcomes and observed outcomes. We scanned participants while they performed a social learning task in gain and loss blocks. Multivariate pattern analysis showed two distinct networks of brain regions adapt to the most likely outcomes within a block. Frontostriatal areas adapted to directly experienced outcomes, whereas lateral frontal and temporoparietal regions adapted to observed social outcomes. Critically, in both cases, adaptation was incomplete and information about whether the outcomes arose in a gain block or a loss block was retained. Univariate analysis confirmed incomplete adaptive coding in these regions but also detected nonadapting outcome signals. Thus, although neural areas rescale their responses to outcomes for efficient coding, they adapt incompletely and keep track of the longer-term incentives available in the environment. SIGNIFICANCE STATEMENT: Optimal value-based choice requires that the brain precisely and efficiently represents positive and negative outcomes. One way to increase efficiency is to adapt responding to the most likely outcomes in a given context. However, too strong adaptation would result in loss of precise representation (e.g., when the avoidance of a loss in a loss-context is coded the same as receipt of a gain in a gain-context). We investigated an intermediate form of adaptation that is efficient while maintaining information about received gains and avoided losses. We found that frontostriatal areas adapted to directly experienced outcomes, whereas lateral frontal and temporoparietal regions adapted to observed social outcomes. Importantly, adaptation was intermediate, in line with influential models of reference dependence in behavioral economics.This work was supported by the Wellcome Trust, Leverhulme Trust and the Swiss National Science Foundation (PP00P1-128574 and CRSTT3-141965).This is the final version of the article. It first appeared from the Society for Neuroscience via https://doi.org/10.1523/JNEUROSCI.0487-16.201

Striatal BOLD Response Reflects the Impact of Herd Information on Financial Decisions

Like other species, humans are sensitive to the decisions and actions of conspecifics, which can lead to herd behavior and undesirable outcomes such as stock market bubbles and bank runs. However, how the brain processes this socially derived influence is only poorly understood. Using functional magnetic resonance imaging (fMRI), we scanned participants as they made decisions on whether to buy stocks after observing others’ buying decisions. We demonstrate that activity in the ventral striatum, an area heavily implicated in reward processing, tracked the degree of influence on participants’ decisions arising from the observation of other peoples’ decisions. The signal did not track non-human, non-social control decisions. These findings lend weight to the notion that the ventral striatum is involved in the processing of complex social aspects of decision making and identify a possible neural basis for herd behavior

Considering evidence: the approach taken by the Hazardous Substances Advisory Committee in the UK

The Hazardous Substances Advisory Committee (HSAC) provides expert advice to UK officials, Ministers and other relevant bodies on the protection of the environment, and human health via the environment, from potentially hazardous substances and articles. Hazardous substances are often the subject of controversy, on which individuals, and different groups in society, hold divergent views. This paper details the approach taken by HSAC when considering the evidence to provide advice on hazardous substances. Firstly HSAC reviews the range of evidence and determines its quality considering: transparency of aims, the methodology and results, completeness, independent review and accessibility. HSAC does not follow one explicit methodology as the wide range of hazardous substances we consider means they need to be addressed on a case by case basis. Most notably HSAC considers the evidence in the wider context, being aware of factors that influence individuals in their decision making when receiving a HSAC opinion e.g. trust in the source of the evidence, defensibility, conformity to a ‘world view’ and framing. HSACs also reflects on its own perspectives with the aim of addressing bias by the diversity of its membership. The Committee’s intention, in adopting this rounded approach, is to reach opinions that are robust, relevant and defensible