Efficiently Irrational: Twenty-Five Years of Neuroeconomics

Dr. Glimcher currently serves as the chair of the Department of Neuroscience and the Director of the Institute for Translational Neuroscience at New York University’s Grossman School of Medicine. He also holds the Julius Silver Professorship of Neural Science and holds professorial appointments at the departments of Economics, Psychology, Psychiatry and Neural Science at New York University. He is the founding director of NYU’s Institute for the Study of Decision Making, and a cofounder and past CEO of Datacubed health.

Abstract:

Cognitive and social scientists have struggled with the irrationalities of human choice behavior; people consistently make choices that are logically inconsistent. Is human choice behavior evolutionarily, as widely assumed, an inefficient patchwork of competing mechanisms? Twenty-five years of research connecting neurobiological, psychological and economic findings suggests that choice behavior reflects a precisely optimized trade-off between the biological costs of increasing the choice mechanism’s precision and the declining benefits that come as precision increases. Under these constraints a “rationally imprecise” strategy emerges that accounts for many of the idiosyncrasies of choice behavior. This new approach rationalizes many of the puzzling inconsistencies of human choice behavior, explaining why these inconsistencies arise as an optimizing solution in biological choosers.