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Decision-making, Risk and Uncertainty
The question of how
humans make decisions continues to pose important challenges. Historically,
disciplines such as Psychology, Philosophy, Economics and Biology have
approached the problem using different assumptions and different
nomenclature. However, the field of Neuroeconomics has begun to develop as an
inter-disciplinary effort to unify a theoretical framework for understanding
human behavior. Neuroeconomics could be defined as the study of how the
embodied brain interacts with its external environment to produce behavior.
In recent years, fMRI (functional Magnetic Resonance Imaging) and modeling
has developed to a point where neural activity in specific regions of the
brain can be observed while executing a process. In vivo brain activity is
currently being studied as individuals perform a variety of functions, such
as solving problems, making choices between alternatives, forming
expectations about the future, carrying out plans and routine tasks,
interacting, cooperating and negotiating with others.
Patterns of behavior and response have been identified through cognitive science
and confirmed through psycho-physiological methods. It has been well
documented how subjects make decisions and by what mechanisms they do so in a
wide range of conditions. What neuroscience can add to the efforts of
Psychologists, however: Is reinforcement of hypotheses formed in Psychology.
Perhaps of even more value to the effort, is neuroscience’s ability to allow
for the separation of one condition from another as part of the protocol for
testing hypotheses developed in Psychology.
Economists have used Rational Choice Theory, included in which are Game
Theory and Decision Theory, to explain the logic behind optimal human action.
The assumption of rationality is both one of the most important and most
controversial assumptions of modern economics. Current experimental
economics, as well as neuroscience research, informs us about the
relationship between rationality and the mechanisms of human decision-making.
Neuroeconomics can therefore illuminate ecological notions of rationality as
potentially better descriptors of neural mechanisms of the brain in
coordination with behavior.
Philosophers have delved into the subjects of belief, desires and intentions
in relation to human life for nearly the whole of recorded history. However,
for centuries, the study of human behavior has been distinct from the study
of the natural world. The tendency has been for researchers to separate
reason from emotion and for the mind to be considered separately from the
body. In recent years, the orollaries of these approaches have been
recognized as having unnecessarily limited the field of inquiry.
Neuroeconomics can shed light on questions of free will and determinism,
among many others, by examining the neural mechanisms of decision making.
Neuroeconomics can help to illuminate discussion of these questions, each of
which is a potential monograph:
- How
are the mechanisms that direct automatic forms of behavior similar to or
different from the mechanisms that direct deliberative processes?
- Can
externally irrational choices be internally rational? What structures of
the brain inform the discussion?
- Is
there a way to describe preferences from a behavioral and a mechanistic
perspective?
- Do
structures of the brain have the same level of activity in moral versus
non-moral decision-making scenarios?
- Why
are we so good at changing our minds? Is belief revision theory a
mechanism of homeostasis? What structures of the brain could provide a
biological basis for belief and are different structures implicated in
belief revision? What are the cognitive mechanisms that underlie the
human capacity to form and revise beliefs?
- Is
there a neural distinction between risk and ambiguity when subjects make
decisions under conditions of uncertainty? How does emotion impact our
choice among alternatives when outcome is uncertain?
- Are
different areas of the brain active in present versus future oriented
decision making? If so, how do structures of the brain that are active
in present scenarios requiring immediate decisions and actions interact
with structures of the brain that are active when addressing decisions
and actions in future scenarios?
- What
parts of the brain are active during prediction activities and are they
different from those parts that are active when experiencing utility? If
a forecast does not match a result, is part of the brain unhappy? Does
this hold true in scenarios of both positive and negative predicted
utility?
Conceptual Outline of What is to be
Accomplished
1.
To
survey the insights that various disciplines have to offer in understanding
human decision-making.
2.
To
discuss, analyze and criticize the different approaches from the various
disciplines.
3.
To
identify an interdisciplinary problem statement.
4.
To
identify further opportunity for academic pursuits and research in the area
of
5.
Neuroeconomics.
The Value and Usefulness of the
Concept
Knowledge of how the
brain interacts with its environment to produce behavior will allow social
scientists to better understand the variety both within and between
individuals’ decision making. In addition, understanding how the brain
process information can facilitate the development of a unified theoretical
framework for understanding human behavior.
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