Neuroeconomics

Here are some interesting findings from the field of Neuroeconomics:
* Money provides direct reinforcement of the same brain circuitry as a wide variety of reinforcers such as attractive faces, funny cartoons, sports cars, and drugs!
* Our brain gets a kick out of earning high returns for their own sake, and presumably feels pain with the experience of parting with it.
* This might explain why we have a preference for prepayment for certain items, even where prepayment is financially irrational. Our brain seems to be choosing to enjoy consumption and avoid the pain-of-paying.
* According to brain research we are not even consciously aware of the moment of decision, giving rise to self-deception and self-manipulation.

Good Decision

How do you make a good decision without too much emotional bias? There are two decision making strategies, vigilant and hypervigilant. Under a vigilant decision making process the decision maker:
* Thoroughly scans all available information,
* Scans information in a systematic and sequential manner,
* Devotes a consistent amount of attention to each data point, and
* Reviews all alternatives before making a decision.

Research suggests that in the real world a hypervigilant decision making process is actually more effective. The decision maker:
* Scans only that information needed to make an assessment,
* Scans information in any sequence,
* Rapidly attends to selected data points, and
* Reviews needed information only when required.

The idea is to get more flexible in your decision making strategies. Work out when it’s best to use a simpler, hypervigilant strategy, and when the situation and available time allows you to apply a more analytical vigilant decision making process.