New Developments in Neuroeconomics:

Psychophysical Neuroeconomcis

Abstract

This review article explains that in order to further develop the emerging field of neuroeconomics, it is important to incorporate discoveries from psychophysics (a discipline which examines the relationship between physical inputs and psychological responses to them) into modelling strategies in neuroeconomics. Firstly, temporal discounting, one of the most important economic decisions, is introduced, and then it is analyzed, by utilizing the framework of psychophysical neuroeconomics (an approach combining psychophysics and neuroeconomics). Secondly, the article illustrates the roles of neurobiological substrates (e.g., neurotransmitters and neurosteroids) in temporal discounting. In addition, findings in our neurogenetic studies on the modulation of temporal discounting behavior by stress and reward systems are introduced, and how these neuroeconomic studies can help us develop biomedical treatments for problematic behaviors (e.g., addiction and suicide) are addressed. Lastly, the article discusses topics in management sciences (e.g., allocation of time, work leisure balance and business ethics), by employing the analytical frameworks of probability and social discounting.