Thursday, September 14, 2006

The Trust Game: Welcome to Neuroeconomics

For a good introduction to neuroeconomics, which seeks to understand oddities of human behavior by scanning brain activity, see John Cassidy's current New Yorker article, Mind Games.

You probably remember one experimental finding: People with brain damage that limits their ability to process emotion tend to make better investment decisions.

The Trust Game? Oddy enough, it seems to be something of a love match:

In the simplest version of the trust game, one player gives some money to another player, who invests it on his behalf and then decides how much to return to him and how much to keep. The more the first player invests, the more he stands to gain, but the more he has to trust the second player. If the players trust each other, both will do well. If they don’t, neither will end up with much money.

Fehr and his collaborators divided a group of student volunteers into two groups. The members of one group were each given six puffs of the nasal spray Syntocinon, which contains oxytocin, a hormone that the brain produces during breast-feeding, sexual intercourse, and other intimate types of social bonding. The members of the other group were given a placebo spray.

Scientists believe that oxytocin is connected to stress reduction, enhanced sociability, and, possibly, falling in love. The researchers hypothesized that oxytocin would make people more trusting, and their results appear to support this claim. Of the twenty-nine students who were given oxytocin, thirteen invested the maximum money allowed, compared with just six out of twenty-nine in the control group.http://www.newyorker.com/archive/2006/09/18/060918fa_fact

No comments: