Kahneman and Frederick (2007)
Human choices are remarkably susceptible to the manner in which options are presented. This so-called "framing effect" represents a striking violation of standard economic accounts of human rationality, although its underlying neurobiology is not understood. We found that the framing effect was specifically associated with amygdala activity, suggesting a key role for an emotional system in mediating decision biases. Moreover, across individuals, orbital and medial prefrontal cortex activity predicted a reduced susceptibility to the framing effect. This finding highlights the importance of incorporating emotional processes within models of human choice and suggests how the brain may modulate the effect of these biasing influences to approximate rationality.
De Martino: Frames, Biases, and Rational Decision-Making in the Human Brain
The Kahneman 'Trends' article demonstrates the cross-talk between several areas of psychology and how they can relate to economic decision-making. In general we are talking again about dual-systems models of human behaviour. This is a given at this stage in the research and different versions have been proposed by Loewenstein in a working paper with Ted O'Donoghue, in several neuroeconomics papers, and most comprehensively in the Reflective-Impulsive model of Social Behaviour proposed by Strack and Deutsch in '04.
The model of the brain that is suggested is an emotional/impulsive system which primes motivational tendencies of approach or avoidance. These responses are monitored largely through the anterior cingulate cortex which recognises conflict between the emotional/impulsive system and the more reflective/deliberate system. Self-regulatory resources have been proposes as the source of the power for the deliberate system.
In relation to framing effects, we must be able to monitor our emotional reactions (ACC monitoring amygdala) in order to inhibit an impulsive tendency (the action of the prefrontal) and we must have societally induced standards to work from in order to do this (no specific brain area to my knowledge). Some specific words are likely to prime motivational tendencies of approach or avoidance (e.g. 'keep' or 'lose'). If we have a good reflective system and our regulatory resources are available we should be able to use deliberation to come to a mathematically rational conclusion.
Framing effects, like the implicit association test, are a good way of testing the influence of an automatic system. Introducing response time pressure would probably have similar effects as would depleting self-regulatory resources prior to economic decision-making.
An interesting finding which is touched on in the Kahneman paper is that the concordance of a response action with a motivational tendency evoked by a stimulus is important. So pulling a lever towards oneself is easier if you are responding to a positive word (e.g. gain) where as pushing a lever away is easier if you are responding to a negative word (e.g. loss). If we compare response times of people doing this and those forced to do the opposite we have a measure of the magnitude of the active component of the framing effect which would be a good accompaniment to an economic decision-making task involving framing.
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