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on Neuroeconomics |
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Issue of 2012‒06‒25
eight papers chosen by |
| By: | Heckman, James J. (University of Chicago); Kautz, Tim (University of Chicago) |
| Abstract: | This paper summarizes recent evidence on what achievement tests measure; how achievement tests relate to other measures of "cognitive ability" like IQ and grades; the important skills that achievement tests miss or mismeasure, and how much these skills matter in life. Achievement tests miss, or perhaps more accurately, do not adequately capture, soft skills – personality traits, goals, motivations, and preferences that are valued in the labor market, in school, and in many other domains. The larger message of this paper is that soft skills predict success in life, that they causally produce that success, and that programs that enhance soft skills have an important place in an effective portfolio of public policies. |
| Keywords: | personality, achievement tests, IQ, cognition |
| JEL: | I20 D01 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6580&r=neu |
| By: | Kuhnen, Camelia M. |
| Abstract: | The goal of this study is to ask whether investors learn differently from gains (positive news) versus losses (negative news), whether learning performance is better or worse when people are actively investing in a security or passively observing the security’s payoffs, and whether there are personal characteristics that correlate with learning performance. The experimental evidence documented here indicates that the ability to learn from financial information is on average worse in the loss domain, in particular if the investor has personally experienced the prior outcomes of the financial asset considered. Within individual, learning from gains versus losses, or during active versus passive involvement, are not perfectly correlated, indicating that there exists heterogeneity across people with respect to the type of financial information or context to which they are the most sensitive. Learning performance is determined by acquired financial expertise as well as by genetic factors related to memory and cognitive control. |
| Keywords: | financial decision making; learning; gains; losses; genes; COMT; neuroeconomics |
| JEL: | G11 D83 C91 |
| Date: | 2012–06–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39412&r=neu |
| By: | McFadden, Brandon R.; Lusk, Jayson L.; Crespi, John M.; Cherry, J. Bradley C.; Martin, Laura E.; Bruce, Amanda S. |
| Abstract: | With new food technologies such as cloning or added artificial growth hormones, consumers face complex and conflicting information related to the quality, safety, nutrition, and ethical outcomes associated with food choices. Economics has partially addressed the challenge of predicting people’s choices and willingness-to-pay for new food technologies by using experimental methods, but thus far has offered little to explain why choices are made. The emerging field of neuroeconomics, which integrates the findings of economics, psychology, and neuroscience, can provide unique insights into consumer preferences. The purpose of this research is to enhance understanding of consumers’ preferences for new food technologies by capitalizing on recent developments in economics and neuroscience. Specifically, this research seeks to determine how the human brain responds to the controversial newer food technologies as compared to standard, “rational” food attributes such as product price. |
| Keywords: | Controversial Food Technology, Animal Cloning, Artificial Growth Hormones, Neuroeconomics, Food Consumption/Nutrition/Food Safety, Institutional and Behavioral Economics, Research and Development/Tech Change/Emerging Technologies, |
| Date: | 2012–05–29 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea12:124071&r=neu |
| By: | McFadden, Brandon R.; Lusk, Jayson L.; Crespi, John M.; Cherry, J. Bradley C.; Martin, Laura E.; Bruce, Amanda S. |
| Abstract: | Understanding how consumers respond to information about animal production systems is important both for animal activist groups and for agricultural producers alike. This is particularly true as information conveyed over platforms such as YouTube both decrease the cost of communication and increase the speed at which interested parties can communicate with the public. The emerging field of neuroeconomics, which integrates the findings of economics, psychology, and neuroscience, can provide unique insights into consumer responses. The purpose of this research is to enhance understanding of consumers’ perceptions of farm animal welfare by capitalizing on recent developments in economics and neuroscience. |
| Keywords: | Animal Welfare, Video Information, Neuroeconomics, Institutional and Behavioral Economics, Marketing, |
| Date: | 2012–05–29 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea12:124048&r=neu |
| By: | Menapace, Luisa; Colson, Gregory; Raffaelli, Roberta |
| Keywords: | Environmental Economics and Policy, Farm Management, |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea12:124770&r=neu |
| By: | Bonnefon, Jean-François (Centre national de la recherche scientifique); De Neys, Wim (Centre national de la recherche scientifique); Hopfensitz, Astrid (TSE) |
| Abstract: | The capacity to trust wisely is a critical facilitator of success and prosperity, and it has been conjectured that people of higher intelligence were better able to detect signs of untrustworthiness from potential partners. In contrast, this article reports five Trust Game studies suggesting that reading trustworthiness on the faces of strangers is a modular process. Trustworthiness detection from faces is independent of general intelligence (Study 1) and effortless (Study 2). Pictures that include non-facial features such as hair and clothing impair trustworthiness detection (Study 3) by increasing reliance on conscious judgments (Study 4), but people largely prefer to make decisions from this sort of pictures (Study 5). In sum, trustworthiness detection in an economic interaction is a genuine and effortless ability, possessed in equal amount by people of all cognitive capacities, but whose impenetrability leads to inaccurate conscious judgments and inappropriate informational preferences. |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:25848&r=neu |
| By: | Heller, Yuval |
| Abstract: | Experimental evidence suggest that people only use 1-3 iterations of strategic reasoning, and that some people systematically use less iterations than others. In this paper, we present a novel evolutionary foundation for these stylized facts. In our model, agents interact in finitely repeated Prisoner's Dilemma, and each agent is characterized by the number of steps he thinks ahead. When two agents interact, each of them has an independent probability to observe the opponent's type. We show that if this probability is not too close to 0 or 1, then the evolutionary process admits a unique stable outcome, in which the population includes a mixture of “naive” agents who think 1 step ahead, and “sophisticated” agents who think 2-3 steps ahead. |
| Keywords: | Indirect evolution; cognitive hierarchy; bounded forward-looking; Prisoner's Dilemma; Cooperation |
| JEL: | D03 C73 |
| Date: | 2012–06–13 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39429&r=neu |
| By: | Donja Darai; Silvia Grätz |
| Abstract: | Physical attractiveness is associated with goodness in the literature. In particular, people think of attractive ones as being more socially skillful, trustworthy, or likeable. This "beauty-is-good" stereotype can induce a beauty premium in various economic interactions. Cooperative behavior might be one more such attribute that is elicited by physical attractiveness. In this paper we analyze this potential relationship. We combine data from 211 episodes of a television game show, in which contestants play a face-to-face prisoner's dilemma game, with data from independent facial appearance ratings of these contestants. The main finding is that attractiveness is an important factor for cooperative behavior even in an environment of very high stakes, communication, and past behavior. Although there is no difference between facially attractive and unattractive contestants regarding the decision to cooperate, facing a facially attractive opponent increases cooperation significantly. Especially, in mixed-gender interactions males and females are more likely to cooperate with a facially attractive counterpart. The marginal beauty premium for a one standard deviation increase in facial attractiveness amounts to an increase of a contestant's expected earnings of £2 153. Moreover, the probability to obtain positive earnings increases by 5.9 percentage points for facially attractive contestants. |
| Keywords: | Beauty premium, stereotypes, cooperation, prisoner's dilemma |
| JEL: | C71 D83 Z13 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:082&r=neu |