Modern Transformations of Economics: Neuroeconomics

Traditionally, economists have not been interested in the neural underpinnings of human behavior. According to the classical decision-making theory, a decision-maker is a perfectly rational cognitive agent ignoring the influence of emotions. However, in recent years this model has been challenged by prospect theory, which identifies heuristics and biases that influence human choice. A recent approach known as neuroeconomics is a transdisciplinary field that tries to shed light on the computational and neurobiological mechanisms underlying the decision-making process, integrating ideas and methods from the fields of psychology, neuroscience, economics and computer science. Neuroeconomics gives researchers an opportunity to look into the “black box” of the human brain, which will give an opportunity to investigate how people make choices, how the brain calculates gains and losses, the roles of emotions and cognition, etc. The aim of this paper is to survey findings from the neuroeconomic literature and investigate the implications of this knowledge for understanding human behavior in various contexts.