What Decision Neuroscience Teaches Us About Financial Decision Making

Peter Bossaerts ()
Additional contact information
Peter Bossaerts: Division of the Humanities and Social Sciences, California Institute of Technology, Pasadena, California 91125; Ecole Polytechnique Fédérale, CH-1015 Lausanne, Switzerland

Annual Review of Financial Economics, 2009, vol. 1, issue 1, pages 383-404

Abstract: Financial decision making is the outcome of complex neurophysiological processes involving, among others, constant re-evaluation of the statistics of the problem at hand, balancing of the various emotional aspects, and computation of the very value signals that are at the core of modern economic thinking. The evidence suggests that emotions play a crucial supporting role in the mathematical computations needed for reasoned choice, rather than interfering with it, even if emotions (and their mathematical counterparts) may not always be balanced appropriately. Decision neuroscience can be expected in the near future to provide a number of effective tools for improved financial decision making.

Keywords: neuroeconomics; experimental finance; risk; emotions (search for similar items in EconPapers)
JEL-codes: D87 G11 (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.annualreviews.org/doi/abs/10.1146/annurev.financial.102708.141514 (application/pdf)
Full text downloads are only available to subscribers. Visit the abstract page for more information.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:anr:refeco:v:1:y:2009:p:383-404

Ordering information: This journal article can be ordered from
http://www.annualreviews.org/action/ecommerce

Access Statistics for this article

More articles in Annual Review of Financial Economics from Annual Reviews
Address: Annual Reviews 4139 El Camino Way Palo Alto, CA 94306, USA
Series data maintained by http://www.annualreviews.org ().