From cognitive science to cognitive neuroscience to neuroeconomics

As an emerging discipline, neuroeconomics faces considerable methodological and practical challenges. In this paper, I suggest that these challenges can be understood by exploring the similarities and dissimilarities between the emergence of neuroeconomics and the emergence of cognitive and computational neuroscience two decades ago. From these parallels, I suggest the major challenge facing theory formation in the neural and behavioural sciences is that of being under-constrained by data, making a detailed understanding of physical implementation necessary for theory construction in neuroeconomics. Rather than following a top-down strategy, neuroeconomists should be pragmatic in the use of available data from animal models, information regarding neural pathways and projections, computational models of neural function, functional imaging and behavioural data. By providing convergent evidence across multiple levels of organization, neuroeconomics will have its most promising prospects of success

Bayesian priors are encoded independently from likelihoods in human multisensory perception

It has been shown that human combination of crossmodal information is highly consistent with an optimal Bayesian model performing causal inference. These findings have shed light on the computational principles governing crossmodal integration/segregation. Intuitively, in a Bayesian framework priors represent a priori information about the environment, i.e., information available prior to encountering the given stimuli, and are thus not dependent on the current stimuli. While this interpretation is considered as a defining characteristic of Bayesian computation by many, the Bayes rule per se does not require that priors remain constant despite significant changes in the stimulus, and therefore, the demonstration of Bayes-optimality of a task does not imply the invariance of priors to varying likelihoods. This issue has not been addressed before, but here we empirically investigated the independence of the priors from the likelihoods by strongly manipulating the presumed likelihoods (by using two drastically different sets of stimuli) and examining whether the estimated priors change or remain the same. The results suggest that the estimated prior probabilities are indeed independent of the immediate input and hence, likelihood

The Right and the Good: Distributive Justice and Neural Encoding of Equity and Efficiency

Distributive justice concerns how individuals and societies distribute benefits and burdens in a just or moral manner. We combined distribution choices with functional magnetic resonance imaging to investigate the central problem of distributive justice: the trade-off between equity and efficiency. We found that the putamen responds to efficiency, whereas the insula encodes inequity, and the caudate/septal subgenual region encodes a unified measure of efficiency and inequity (utility). Notably, individual differences in inequity aversion correlate with activity in inequity and utility regions. Against utilitarianism, our results support the deontological intuition that a sense of fairness is fundamental to distributive justice but, as suggested by moral sentimentalists, is rooted in emotional processing. More generally, emotional responses related to norm violations may underlie individual differences in equity considerations and adherence to ethical rules

Separate encoding of model-based and model-free valuations in the human brain

Behavioral studies have long shown that humans solve problems in two ways, one intuitive and fast (System 1, model-free), and the other reflective and slow (System 2, model-based). The neurobiological basis of dual process problem solving remains unknown due to challenges of separating activation in concurrent systems. We present a novel neuroeconomic task that predicts distinct subjective valuation and updating signals corresponding to these two systems. We found two concurrent value signals in human prefrontal cortex: a System 1 model-free reinforcement signal and a System 2 model-based Bayesian signal. We also found a System 1 updating signal in striatal areas and a System 2 updating signal in lateral prefrontal cortex. Further, signals in prefrontal cortex preceded choices that are optimal according to either updating principle, while signals in anterior cingulate cortex and globus pallidus preceded deviations from optimal choice for reinforcement learning. These deviations tended to occur when uncertainty regarding optimal values was highest, suggesting that disagreement between dual systems is mediated by uncertainty rather than conflict, confirming recent theoretical proposals

Neural Differentiation of Expected Reward and Risk in Human Subcortical Structures

In decision-making under uncertainty, economic studies emphasize the importance of risk in addition to expected reward. Studies in neuroscience focus on expected reward and learning rather than risk. We combined functional imaging with a simple gambling task to vary expected reward and risk simultaneously and in an uncorrelated manner. Drawing on financial decision theory, we modeled expected reward as mathematical expectation of reward, and risk as reward variance. Activations in dopaminoceptive structures correlated with both mathematical parameters. These activations differentiated spatially and temporally. Temporally, the activation related to expected reward was immediate, while the activation related to risk was delayed. Analyses confirmed that our paradigm minimized confounds from learning, motivation, and salience. These results suggest that the primary task of the dopaminergic system is to convey signals of upcoming stochastic rewards, such as expected reward and risk, beyond its role in learning, motivation, and salience

Reason, emotion and decision-making: risk and reward computation with feeling

Many models of judgment and decision-making posit distinct cognitive and emotional contributions to decision-making under uncertainty. Cognitive processes typically involve exact computations according to a cost-benefit calculus, whereas emotional processes typically involve approximate, heuristic processes that deliver rapid evaluations without mental effort. However, it remains largely unknown what specific parameters of uncertain decision the brain encodes, the extent to which these parameters correspond to various decision-making frameworks, and their correspondence to emotional and rational processes. Here, I review research suggesting that emotional processes encode in a precise quantitative manner the basic parameters of financial decision theory, indicating a reorientation of emotional and cognitive contributions to risky choice