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on Neuroeconomics |
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Issue of 2010‒01‒23
three papers chosen by |
| By: | Perez Truglia, Ricardo Nicolas |
| Abstract: | Some sensations, in addition to guide behavior, serve an extra and even more important role: as warning or defense mechanisms (e.g. pain, fever). Additionally, intense sensations are costly from a fitness point of view. With only these two biological facts we show that Nature must design utility functions with regulation mechanisms such as hedonic adaptation or expectation-based preferences. Even though they are rarely incorporated into economic models, such mechanisms are widely recognized and documented in many fields such as neuroscience and psychology. Using such utility functions economists will not only provide more accurate welfare predictions, but we will also increase the number of behavioral phenomena that we are able to explain. Finally, we provide as an application a model of the psychological defenses. |
| Keywords: | hedonic adaptation; evolution; expectations; decision utility; experienced utility |
| JEL: | B52 I00 |
| Date: | 2009–07–29 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:19929&r=neu |
| By: | Björn Frank (University of Kassel, Nora-Platiel-Straße 4, D-34127 Kassel) |
| Abstract: | Rubinstein (2007) has recently found that the frequency of (types of) decisions made in Internet experiments are related to the time taken for these decisions. Other authors have investigated this relationship by exerting some time pressure. In this paper, I report on an attempt to do the opposite, i.e., to enforce a longer reflection time. To ensure that subjects do not just wait but actually think for five minutes, they had to perform a five minutes focused free writing task. Free writing is a standard method adopted from creative writing courses; subjects are asked to write up everything that currently runs through their minds, without pausing. Enforced reflection significantly decreases the number chosen in beauty contest experiments, thus increasing the winning probability, and it increases the amount given in the solidarity game. For women, this increase is economically and statistically significant. The average amount offered in the ultimatum game is not higher for those who had performed the free writing task. However, after free writing, the share of 50:50 offers is significantly higher, which is in conflict with Rubinstein's conjecture that 50:50 offers take less time because they are instinctive (as opposed to cognitive). |
| Keywords: | free writing, decision time, beauty contest, solidarity game, ultimatum game |
| JEL: | C90 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201002&r=neu |
| By: | López-Pérez, Raúl (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.); Vorsatz, Marc (Fundación de Estudios de Economía Aplicada–FEDEA) |
| Abstract: | The literature on social norms stresses that compliance with norms is approved while deviance is disapproved. Based on this, we explore the content of social norms using experimental data from five dictator games with a feedback stage. Our data suggests that subjects either care about a reciprocity or an efficiency norm. |
| Keywords: | approval; disapproval; dictator game; experiment; social Norms. |
| JEL: | A13 C72 D64 Z13 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:uam:wpaper:201001&r=neu |