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Decision-Making in Economics: Critical Lessons from Neurobiology

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posted on 2014-01-01, 00:00 authored by R Martins, K Kumar, A Mukherjee, Munirul NabinMunirul Nabin, Sukanto BhattacharyaSukanto Bhattacharya
In this chapter, the authors consider some of the issues regarding the rational choice decision framework in neoclassical economics and how it can particularly be found wanting in the absence of due consideration for some of the underlying critical neurobiological factors which govern decision making. They develop a critical decision problem and explore the scenario where the solution predicted by formal economic theory may be in conflict with the decision that actually occurs. Such conflict is especially relevant in the context of economic decision making in emerging markets where there can be a lack of trust in the system by the agents operating within it. Based on logically consistent arguments derived from the extant literature, the authors argue that non-consideration of underlying neurobiological factors is a direct cause of this conflict.

History

Title of book

Economic Behaviour, Game Theory, and Technology in Emerging Markets

Chapter number

4

Pagination

46 - 56

Publisher

IGI Global

Place of publication

Hershey, PA

ISBN-13

9781466647473

ISBN-10

1466647477

Language

eng

Publication classification

B1 Book chapter

Copyright notice

2014, IGI Global

Extent

20

Editor/Contributor(s)

B Christiansen, M Basilgan

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