Risky business: the neuroeconomics of decision making under uncertainty.
Many decisions involve uncertainty, or imperfect knowledge about how choices lead to outcomes. Colloquial notions of uncertainty, particularly when describing a decision as 'risky', often carry connotations of potential danger as well. Gambling on a long shot, whether a horse at the racetrack or a foreign oil company in a hedge fund, can have negative consequences, but the impact of uncertainty on decision making extends beyond gambling. Indeed, uncertainty in some form pervades nearly all our choices in daily life. Stepping into traffic to hail a cab, braving an ice storm to be the first at work, or dating the boss's son or daughter also offer potentially great windfalls, at the expense of surety. We continually face trade-offs between options that promise safety and others that offer an uncertain potential for jackpot or bust. When mechanisms for dealing with uncertain outcomes fail, as in mental disorders such as problem gambling or addiction, the results can be disastrous. Thus, understanding decision making-indeed, understanding behavior itself-requires knowing how the brain responds to and uses information about uncertainty.
Platt
Michael L
ML
Center for Neuroeconomic Studies, Room B243F LSRC Building, Duke University, Durham, North Carolina 27708-0999, USA. platt@neuro.duke.edu
Huettel
Scott A
SA
D000818:Animals; D001921:Brain / Q000502:physiology*; D002755:Choice Behavior; D003657:Decision Making; D005260:Female; D006801:Humans; D008297:Male; D011337:Probability Learning; D012054:Reinforcement, Psychology; D012309:Risk-Taking; D012737:Sex Factors; D035501:Uncertainty