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Author Fehr, Ernst ♦ Fischbacher, Urs ♦ Kosfeld, Michael
Source CiteSeerX
Content type Text
File Format PDF
Language English
Subject Domain (in DDC) Computer science, information & general works ♦ Data processing & computer science
Subject Keyword Individual Belief ♦ Forschungsinstitut Zur Zukunft Der ♦ Strong Free-riding Incentive ♦ Preferred Action ♦ Different Way ♦ Sequential Sd ♦ Free Rider ♦ Social Preference ♦ Neuroeconomic Foundation ♦ Sd Game ♦ Recent Neuroeconomic Evidence ♦ Economic Model ♦ Rational Behavior ♦ Available Action ♦ Social Dilemma ♦ Mutual Cooperation ♦ Individual Decision-making ♦ Animal Study ♦ Neuroeconomics Merges Method ♦ Nonselfish Behavior ♦ Neuropeptide Oxytocin ♦ Trustworthy Behavior ♦ Actual Choice ♦ Different Frame ♦ Elicit Different Behavior ♦ Nonpecuniary Utility ♦ Human Brain Generates Decision ♦ General Quest ♦ Unfair Behavior ♦ Player Action ♦ Recent Study ♦ Social Context
Description Neuroeconomics merges methods from neuroscience and economics to better understand how the human brain generates decisions in economic and social contexts. Neuroeconomics is part of the general quest for microfoundations—in this case, the microfoundation of individual decision-making in social contexts. The economic model of individual decision-making is based on three concepts: the action set, preferences, and beliefs. Economists assume that an individual will choose his preferred action for a given set of available actions and a given belief about the states of the world and the other players ’ actions. Neuroeconomics provides a microfoundation for individual beliefs, preferences, and behavior; it does so by examining the brain processes associated with the formation of beliefs, the perception of the action set, and the actual choice. Moreover, since the set of available actions can be framed in different ways and different frames of the same action set sometimes elicit different behaviors, neuroeconomics may also contribute to a deeper understanding of framing effects. This paper discusses recent neuroeconomic evidence related to other-regarding (nonselfish) behaviors and the decision to trust in other people’s nonselfish behavior. As we will show, this evidence supports the view that people derive nonpecuniary utility (i) from mutual cooperation in social dilemma (SD) games and (ii) from punishing unfair behavior in these games. Thus, mutual cooperation that takes place despite strong free-riding incentives, and the punishment of free riders in SD games is not irrational, but better understood as rational behavior of people with corresponding social preferences. Finally, we report the results of a recent study that examines the impact of the neuropeptide oxytocin (OT) on trusting and trustworthy behavior in a sequential SD. Animal studies have identified OT as a hormone that induces
Educational Role Student ♦ Teacher
Age Range above 22 year
Educational Use Research
Education Level UG and PG ♦ Career/Technical Study
Learning Resource Type Article
Publisher Date 2005-01-01
Publisher Institution Arbeit, IZA (Institute for the Study of Labor