It's the biology, stupid! Proxy failures in economic decision making.

Utilitarian characterizations of economic decision making fail to capture the complex, conditional, and heterogeneous motivations underlying human behavior as shaped by the predictive, multicriterial drivers of biological regulation. Unless economic models start to acknowledge that humans have bodies and a biology with its own adaptive logic and tradeoffs, economic policies will be systematically exposed to, and systematic generators of, proxy failures.

Common neural dysfunction of economic decision-making across psychiatric conditions.

Adaptive decision-making, which is often impaired in various psychiatric conditions, is essential for well-being. Recent evidence has indicated that decision-making capacity in multiple tasks could be accounted for by latent dimensions, enlightening the question of whether there is a common disruption of brain networks in economic decision-making across psychiatric conditions. Here, we addressed the issue by combining activation/lesion network mapping analyses with a transdiagnostic brain imaging meta-analysis. Our findings indicate that there were transdiagnostic alterations in the thalamus and ventral striatum during the decision or outcome stage of decision-making. The identified regions represent key nodes in a large-scale network, which is composed of multiple heterogeneous brain regions and plays a causal role in motivational functioning. The findings suggest that disturbances in the network associated with emotion- and reward-related processing play a key role in dysfunctions of decision-making observed in various psychiatric conditions. This study provides the first meta-analytic evidence of common neural alterations linked to deficits in economic decision-making.

Impact of behavioral biases on investment decisions and the moderation effect of financial literacy; an evidence of Pakistan.

Th is study offers empirical insights into investor behavior and its correlation with various behavioral biases in the context of investment decisions in the Pakistan Stock Exchange (PSX). Data was collected through a structured questionnaire from 261 individual investors in Pakistan. The study employs hierarchical regression analysis to test the hypothesis. It considers several behavioral biases, and statistically, anchoring and adjustment, overconfidence, and herding show a significant impact. The study uses financial literacy to examine its moderating effects on these biases, and the result suggests that it significantly influences behavioral biases related to investment decisions. The results underscore the unique investment behaviors in emerging markets, contrasting with established norms in well-developed financial markets. These findings can inform policymakers and stock market authorities about investor decision-making in emerging economies.

Foraging in a non-foraging task: Fitness maximization explains human risk preference dynamics under changing environment.

Changes in risk preference have been reported when making a series of independent risky choices or non-foraging economic decisions. Behavioral economics has put forward various explanations for specific changes in risk preference in non-foraging tasks, but a consensus regarding the general principle underlying these effects has not been reached. In contrast, recent studies have investigated human economic risky choices using tasks adapted from foraging theory, which require consideration of past choices and future opportunities to make optimal decisions. In these foraging tasks, human economic risky choices are explained by the ethological principle of fitness maximization, which naturally leads to dynamic risk preference. Here, we conducted two online experiments to investigate whether the principle of fitness maximization can explain risk preference dynamics in a non-foraging task. Participants were asked to make a series of independent risky economic decisions while the environmental richness changed. We found that participants' risk preferences were influenced by the current and past environments, making them more risk-averse during and after the rich environment compared to the poor environment. These changes in risk preference align with fitness maximization. Our findings suggest that the ethological principle of fitness maximization might serve as a generalizable principle for explaining dynamic preferences, including risk preference, in human economic decision-making.

Dissecting Bayes: Using influence measures to test normative use of probability density information derived from a sample.

Bayesian decision theory (BDT) is frequently used to model normative performance in perceptual, motor, and cognitive decision tasks where the possible outcomes of actions are associated with rewards or penalties. The resulting normative models specify how decision makers should encode and combine information about uncertainty and value-step by step-in order to maximize their expected reward. When prior, likelihood, and posterior are probabilities, the Bayesian computation requires only simple arithmetic operations: addition, etc. We focus on visual cognitive tasks where Bayesian computations are carried out not on probabilities but on (1) probability density functions and (2) these probability density functions are derived from samples. We break the BDT model into a series of computations and test human ability to carry out each of these computations in isolation. We test three necessary properties of normative use of pdf information derived from a sample-accuracy, additivity and influence. Influence measures allow us to assess how much weight each point in the sample is assigned in making decisions and allow us to compare normative use (weighting) of samples to actual, point by point. We find that human decision makers violate accuracy and additivity systematically but that the cost of failure in accuracy or additivity would be minor in common decision tasks. However, a comparison of measured influence for each sample point with normative influence measures demonstrates that the individual's use of sample information is markedly different from the predictions of BDT. We will show that the normative BDT model takes into account the geometric symmetries of the pdf while the human decision maker does not. An alternative model basing decisions on a single extreme sample point provided a better account for participants' data than the normative BDT model.

Effort-cost decision-making associated with negative symptoms in schizophrenia and bipolar disorder.

Motivational deficits and reduced goal-directed behavior for external rewards have long been considered an important features of negative symptoms in patients with schizophrenia (SCZ). Negative symptoms have also a high prevalence in bipolar disorder (BP). We used a transdiagnostic approach in order to examine association between negative symptoms and effort allocation for monetary rewards. 41 patients with SCZ and 34 patients with BP were enrolled in the study along with 41 healthy controls (HC). Effort-Expenditure for Rewards Task (EEfRT) was used to measure subjects' effort allocation for monetary rewards. Generalized estimating equation models were used to analyze EEfRT choice behavior. Negative symptoms were assessed using the Brief Negative Symptom Scale (BNSS). SCZ and BP groups expended lower effort to obtain a monetary rewards compared to HC. Severity of negative symptoms was negatively correlated with EEfRT performance in both diagnostic groups. Each diagnostic group showed lower effort allocation for monetary rewards compared to HC suggesting reduced motivation for monetary rewards. In addition, our results suggest that abnormal effort-based decision-making might be a transdiagnostic factor underlying negative symptoms.

Everyday amnesia: Residual memory for high confidence misses and implications for decision models of recognition.

Despite studying a list of items only minutes earlier, when reencountered in a recognition memory test, undergraduate participants often say with total confidence that they have not studied some of the items before. Such high confidence miss (HCM) responses have been taken as evidence of rapid and complete forgetting and of everyday amnesia (Roediger & Tekin, 2020). We investigated (a) if memory for HCMs is completely lost or whether a residual memory effect exists and (b) whether dominant decision models predict the effect. Participants studied faces (Experiments 1a, 2, and 3) or words (Experiment 1b), then completed a single-item recognition memory task, followed by either (a) a two-alternative forced-choice recognition task, in which the studied and nonstudied alternatives on each trial were matched for their previous old/new decision and confidence rating (Experiments 1 and 2) or (b) a second single-item recognition task in which the targets and foils were HCMs and high confidence correct rejections, respectively (Experiment 3). In each experiment, participants reliably distinguished HCMs from high-confidence correct rejections. The unequal variance signal detection and dual-process signal detection models were fit to the single-item recognition data, and the parameter estimates were used to predict the memory effect for HCMs. The dual-process signal detection model predicted the residual memory effect (as did another popular model, the mixture signal detection theory model). However, the unequal variance signal detection model incorrectly predicted a negative, or no, effect, invalidating this model. The residual memory effect for HCMs demonstrates that everyday amnesia is not associated with complete memory loss and distinguishes between decision models. (PsycInfo Database Record (c) 2024 APA, all rights reserved).

Chronic high-dose testosterone impairs economic decision making, but has no effect on memory in male rats.

The goal is to understand consequences of anabolic-androgenic steroid (AAS) abuse on cognitive function, using rats as a model. Economic decision making was evaluated in an operant test of effort value discounting, where subjects choose between 2 levers that deliver large and small rewards differing in maximum value and reward contrast. The hypothesis is that chronic high-dose testosterone increases preference for large rewards. Male rats were treated chronically with testosterone (7.5 mg/kg) or vehicle. Initially, all rats preferred the large reward lever when large and small rewards remained fixed at 3 and 1 sugar pellets, respectively. When different reward values were introduced, and with increasing response requirements, testosterone-treated rats made fewer responses for the large reward, and increased omissions. They earned fewer rewards overall. To determine if testosterone impairs memory, rats were tested for recognition memory with the novel object recognition and social transmission of food preference tasks, and for spatial memory with the radial arm maze and Morris water maze. There was not effect of chronic high-dose testosterone on any memory task. These results suggest that testosterone shifts economic decision making towards larger rewards even when they are disadvantageous, but does not alter memory in rats.

Neural substrates of the interaction between effort-expenditure reward decision-making and outcome anticipation.

OBJECTIVE: Reward anticipation is important for future decision-making, possibly due to re-evaluation of prior decisions. However, the exact relationship between reward anticipation and prior effort-expenditure decision-making, and its neural substrates are unknown. METHOD: Thirty-three healthy participants underwent fMRI scanning while performing the Effort-based Pleasure Experience Task (E-pet). Participants were required to make effort-expenditure decisions and anticipate the reward. RESULTS: We found that stronger anticipatory activation at the posterior cingulate cortex was correlated with slower reaction time while making decisions with a high-probability of reward. Moreover, the substantia nigra was significantly activated in the prior decision-making phase, and involved in reward-anticipation in view of its strengthened functional connectivity with the mammillary body and the putamen in trial conditions with a high probability of reward. CONCLUSIONS: These findings support the role of reward anticipation in re-evaluating decisions based on the brain-behaviour correlation. Moreover, the study revealed the neural interaction between reward anticipation and decision-making.

Gradient boosted decision trees reveal nuances of auditory discrimination behavior.

Animal psychophysics can generate rich behavioral datasets, often comprised of many 1000s of trials for an individual subject. Gradient-boosted models are a promising machine learning approach for analyzing such data, partly due to the tools that allow users to gain insight into how the model makes predictions. We trained ferrets to report a target word's presence, timing, and lateralization within a stream of consecutively presented non-target words. To assess the animals' ability to generalize across pitch, we manipulated the fundamental frequency (F0) of the speech stimuli across trials, and to assess the contribution of pitch to streaming, we roved the F0 from word token to token. We then implemented gradient-boosted regression and decision trees on the trial outcome and reaction time data to understand the behavioral factors behind the ferrets' decision-making. We visualized model contributions by implementing SHAPs feature importance and partial dependency plots. While ferrets could accurately perform the task across all pitch-shifted conditions, our models reveal subtle effects of shifting F0 on performance, with within-trial pitch shifting elevating false alarms and extending reaction times. Our models identified a subset of non-target words that animals commonly false alarmed to. Follow-up analysis demonstrated that the spectrotemporal similarity of target and non-target words rather than similarity in duration or amplitude waveform was the strongest predictor of the likelihood of false alarming. Finally, we compared the results with those obtained with traditional mixed effects models, revealing equivalent or better performance for the gradient-boosted models over these approaches.

Slowing of Movements in Healthy Aging as a Rational Economic Response to an Elevated Effort Landscape.

Why do we move slower as we grow older? The reward circuits of the brain, which tend to invigorate movements, decline with aging, raising the possibility that reduced vigor is due to the diminishing value that our brain assigns to movements. However, as we grow older, it also becomes more effortful to make movements. Is age-related slowing principally a consequence of increased effort costs from the muscles, or reduced valuation of reward by the brain? Here, we first quantified the cost of reaching via metabolic energy expenditure in human participants (male and female), and found that older adults consumed more energy than the young at a given speed. Thus, movements are objectively more costly for older adults. Next, we observed that when reward increased, older adults, like the young, responded by initiating their movements earlier. Yet, unlike the young, they were unwilling to increase their movement speed. Was their reluctance to reach quicker for rewards due to the increased effort costs, or because they ascribed less value to the movement? Motivated by a mathematical model, we next made the young experience a component of aging by making their movements more effortful. Now the young responded to reward by reacting faster but chose not to increase their movement speed. This suggests that slower movements in older adults are partly driven by an adaptive response to an elevated effort landscape. Moving slower may be a rational economic response the brain is making to mitigate the elevated effort costs that accompany aging.

Double dissociation of dopamine and subthalamic nucleus stimulation on effortful cost/benefit decision making.

Deep brain stimulation (DBS) and dopaminergic therapy (DA) are common interventions for Parkinson's disease (PD). Both treatments typically improve patient outcomes, and both can have adverse side effects on decision making (e.g., impulsivity).1,2 Nevertheless, they are thought to act via different mechanisms within basal ganglia circuits.3 Here, we developed and formally evaluated their dissociable predictions within a single cost/benefit effort-based decision-making task. In the same patients, we manipulated DA medication status and subthalamic nucleus (STN) DBS status within and across sessions. Using a series of descriptive and computational modeling analyses of participant choices and their dynamics, we confirm a double dissociation: DA medication asymmetrically altered participants' sensitivities to benefits vs. effort costs of alternative choices (boosting the sensitivity to benefits while simultaneously lowering sensitivity to costs); whereas STN DBS lowered the decision threshold of such choices. To our knowledge, this is the first study to show, using a common modeling framework, a dissociation of DA and DBS within the same participants. As such, this work offers a comprehensive account for how different mechanisms impact decision making, and how impulsive behavior (present in DA-treated patients with PD and DBS patients) may emerge from separate physiological mechanisms.

The Impact of Patient Race, Patient Socioeconomic Status, and Cognitive Load of Physician Residents and Fellows on Chronic Pain Care Decisions.

Social stereotypes are more likely to influence decision-making under conditions of high cognitive load (ie, mental workload), such as in medical settings. We examined how patient race, patient socioeconomic status (SES), physician cognitive load, and physician implicit beliefs about race and SES differences in pain tolerance impacted physicians' pain treatment decisions. Physician residents and fellows (N = 120) made treatment decisions for 12 computer-simulated patients with back pain that varied by race (Black/White) and SES (low/high). Half of the physicians were randomized to be interrupted during the decision task to make hypertension medication conversion calculations (high cognitive load group), while the other half completed the task without interruptions (low cognitive load group). Both groups were given equal time to make pain care decisions (2.5 minutes/patient). Results of multilevel ordinal logistic regression analyses indicated that physicians prescribed weaker analgesics to patients with high vs. low SES (odds ratio = .68, 95% confidence interval [.48, .97], P = .03). There was also a patient SES-by-cognitive load interaction (odds ratio = .56, 95% confidence interval [.31, 1.01], P = .05) that is theoretically and potentially practically meaningful but was not statistically significant at P < .05. These findings shed light on physician cognitive load as a clinically-relevant factor in the context of pain care quality and equity. PERSPECTIVE: These findings highlight the clinical relevance of physician cognitive load (eg, mental workload) when providing pain care for diverse patients. This line of work can support the development of interventions to manage physician cognitive load and its impact on pain care, which may ultimately help reduce pain disparities.

A Double Hit of Social and Economic Stress in Mice Precipitates Changes in Decision-Making Strategies.

BACKGROUND: Economic stress can serve as a second hit for people who have already accumulated a history of adverse life experiences. How one recovers from a setback is a core feature of resilience but is seldom captured in animal studies. METHODS: We challenged mice in a novel 2-hit stress model by first exposing them to chronic social defeat stress and then testing adaptations to increasing reward scarcity on a neuroeconomic task. Mice were tested across months on the Restaurant Row task, during which they foraged daily for their primary source of food while on a limited time budget in a closed-economy system. An abrupt transition into a reward-scarce environment elicits an economic challenge, precipitating a drop in food intake and body weight to which mice must respond to survive. RESULTS: We found that mice with a history of social stress mounted a robust behavioral response to this economic challenge that was achieved through a complex redistribution of time allocation among competing opportunities. Interestingly, we found that mice with a history of social defeat displayed changes in the development of decision-making policies during the recovery process that are important not only for ensuring food security necessary for survival but also prioritizing subjective value and that these changes emerged only for certain types of choices. CONCLUSIONS: These findings indicate that an individual's capacity to recover from economic challenges depends on that person's prior history of stress and can affect multiple decision-making aspects of subjective well-being, thus highlighting a motivational balance that may be altered in stress-related disorders such as depression.

Effort Foraging Task reveals positive correlation between individual differences in the cost of cognitive and physical effort in humans.

Effort-based decisions, in which people weigh potential future rewards against effort costs required to achieve those rewards involve both cognitive and physical effort, though the mechanistic relationship between them is not yet understood. Here, we use an individual differences approach to isolate and measure the computational processes underlying effort-based decisions and test the association between cognitive and physical domains. Patch foraging is an ecologically valid reward rate maximization problem with well-developed theoretical tools. We developed the Effort Foraging Task, which embedded cognitive or physical effort into patch foraging, to quantify the cost of both cognitive and physical effort indirectly, by their effects on foraging choices. Participants chose between harvesting a depleting patch, or traveling to a new patch that was costly in time and effort. Participants' exit thresholds (reflecting the reward they expected to receive by harvesting when they chose to travel to a new patch) were sensitive to cognitive and physical effort demands, allowing us to quantify the perceived effort cost in monetary terms. The indirect sequential choice style revealed effort-seeking behavior in a minority of participants (preferring high over low effort) that has apparently been missed by many previous approaches. Individual differences in cognitive and physical effort costs were positively correlated, suggesting that these are perceived and processed in common. We used canonical correlation analysis to probe the relationship of task measures to self-reported affect and motivation, and found correlations of cognitive effort with anxiety, cognitive function, behavioral activation, and self-efficacy, but no similar correlations with physical effort.

Effort cost of harvest affects decisions and movement vigor of marmosets during foraging.

Our decisions are guided by how we perceive the value of an option, but this evaluation also affects how we move to acquire that option. Why should economic variables such as reward and effort alter the vigor of our movements? In theory, both the option that we choose and the vigor with which we move contribute to a measure of fitness in which the objective is to maximize rewards minus efforts, divided by time. To explore this idea, we engaged marmosets in a foraging task in which on each trial they decided whether to work by making saccades to visual targets, thus accumulating food, or to harvest by licking what they had earned. We varied the effort cost of harvest by moving the food tube with respect to the mouth. Theory predicted that the subjects should respond to the increased effort costs by choosing to work longer, stockpiling food before commencing harvest, but reduce their movement vigor to conserve energy. Indeed, in response to an increased effort cost of harvest, marmosets extended their work duration, but slowed their movements. These changes in decisions and movements coincided with changes in pupil size. As the effort cost of harvest declined, work duration decreased, the pupils dilated, and the vigor of licks and saccades increased. Thus, when acquisition of reward became effortful, the pupils constricted, the decisions exhibited delayed gratification, and the movements displayed reduced vigor.

Impact of financial literacy, mental budgeting and self control on financial wellbeing: Mediating impact of investment decision making.

The topic of financial wellbeing is a current concern within the realm of personal and household finance. This study aims to examine the influence of cognitive factors, specifically financial literacy, mental budgeting, and self-control, on subjective financial wellbeing. While there exist multiple determinants of financial wellbeing, this research focuses on these particular cognitive factors. The present study aims to examine the mediating role of investment decision-making behavior in the association between cognitive factors and financial well-being. The study employed Partial Least Squares Structural Equation Modeling (PLS-SEM) to analyze the data collected from a sample of 449 Chinese university students, with the aim of assessing the empirical associations. The results indicate that financial literacy, mental budgeting, and self-control exert a favorable and noteworthy influence on an individual's financial well-being. The results indicate that individuals with a greater degree of financial literacy are more prone to achieving superior financial well-being. Moreover, individuals who practice mental budgeting, a technique that entails mentally classifying and monitoring their expenditures, demonstrate elevated levels of financial well-being. Likewise, the exercise of self-regulation is identified as a pivotal element that impacts an individual's financial wellbeing. The findings indicate that there is evidence to support the mediator, investment decision-making behavior. This mediator partially mediates the association between the independent variables, namely financial literacy, mental budgeting, and self-control, and financial well-being. The results suggest that individuals with elevated levels of financial literacy, proficient mental budgeting skills, and self-regulatory abilities are inclined towards demonstrating favorable investment decision-making conduct. Consequently, this contributes to their general financial welfare. In general, the study's theoretical implications augment the current knowledge repository, while its practical implications provide feasible perspectives for policymakers, financial institutions, and individuals to foster financial wellness and enhance financial results.

Accounting for endogenous effects in decision-making with a non-linear diffusion decision model.

The Drift-Diffusion Model (DDM) is widely accepted for two-alternative forced-choice decision paradigms thanks to its simple formalism and close fit to behavioral and neurophysiological data. However, this formalism presents strong limitations in capturing inter-trial dynamics at the single-trial level and endogenous influences. We propose a novel model, the non-linear Drift-Diffusion Model (nl-DDM), that addresses these issues by allowing the existence of several trajectories to the decision boundary. We show that the non-linear model performs better than the drift-diffusion model for an equivalent complexity. To give better intuition on the meaning of nl-DDM parameters, we compare the DDM and the nl-DDM through correlation analysis. This paper provides evidence of the functioning of our model as an extension of the DDM. Moreover, we show that the nl-DDM captures time effects better than the DDM. Our model paves the way toward more accurately analyzing across-trial variability for perceptual decisions and accounts for peri-stimulus influences.

Prelimbic neuron assemblies with delayed activation encode the economic decision-making process in a bandit game.

The medial prefrontal cortex (mPFC) is critical to an animal's value-based decision-making process. However, due to heterogeneity of local mPFC neurons, which neuron group and how it contributes to the alteration of the animal's decision is yet to be explored. And the effect of empty reward in this process is often neglected. Here, we adopted a two-port bandit game paradigm for mice and applied synchronized calcium imaging to the prelimbic area of the mPFC. The results showed that neurons recruited in the bandit game exhibit three distinct firing patterns. Specially, neurons with delayed activation (deA neurons1) carried exclusive information on reward type and changes of choice value. We demonstrated that these deA neurons were essential for the construction of choice-outcome correlation and the trial-to-trial modification of decision. Additionally, we found that in a long-term gambling game, members of the deA neuron assembly were dynamically shifting while maintaining the function, and the importance of empty reward feedbacks were gradually elevated to the same level as reward. Together, these results revealed a vital role for prelimbic deA neurons in the gambling tasks and a new perspective on the encoding of economic decision-making.

More than a feeling: physiological measures of affect index the integration of effort costs and rewards during anticipatory effort evaluation.

The notion that humans avoid effortful action is one of the oldest and most persistent in psychology. Influential theories of effort propose that effort valuations are made according to a cost-benefit trade-off: we tend to invest mental effort only when the benefits outweigh the costs. While these models provide a useful conceptual framework, the affective components of effort valuation remain poorly understood. Here, we examined whether primitive components of affective response-positive and negative valence, captured via facial electromyography (fEMG)-can be used to better understand valuations of cognitive effort. Using an effortful arithmetic task, we find that fEMG activity in the corrugator supercilii-thought to index negative valence-1) tracks the anticipation and exertion of cognitive effort and 2) is attenuated in the presence of high rewards. Together, these results suggest that activity in the corrugator reflects the integration of effort costs and rewards during effortful decision-making.