What Decision Neuroscience Teaches Us About Financial Decision Making
Financial decision making is the outcome of complex neurophysiological processes involving, among others, constant re-evaluation of the statistics of the problem at hand, balancing of the various emotional aspects, and computation of the very value signals that are at the core of modern economic thinking. The evidence suggests that emotions play a crucial supporting role in the mathematical computations needed for reasoned choice, rather than interfering with it, even if emotions (and their mathematical counterparts) may not always be balanced appropriately. Decision neuroscience can be expected in the neat future to provide a number of effective tools for improved financial decision making.
Keywords: neuroeconomics ; experimental finance ; risk ; emotions ; Risk-Taking Behavior ; Normal-Form Games ; Orbitofrontal Cortex ; Prefrontal Cortex ; Prediction Errors ; Human Brain ; Dopamine Neurons ; Monetary Rewards ; Neural Response ; Choice Behavior
Record created on 2010-11-30, modified on 2016-08-09