The Neurobiology of Context-Dependent Valuation and Choice

Neuroeconomics: Decision Making and the Brain: Second Edition

Volumn , Issue , 2013, Pages 455-476

  Louie, Kenway ^a   De Martino, Benedetto ^b,c  

^a NEW YORK UNIVERSITY   (United States)

^b UNIVERSITY COLLEGE LONDON   (United Kingdom)

^c CALIFORNIA INSTITUTE OF TECHNOLOGY   (United States)

Author keywords

Context dependence; Decision making; Efficient coding; Neuroeconomics; Reward

Indexed keywords

EID: 84902420655     PISSN: None     EISSN: None     Source Type: Book    
DOI: 10.1016/B978-0-12-416008-8.00024-3     Document Type: Chapter

References (120)

1. Abeler J., Falk S., Goette L., Huffman D. Reference points and effort provision. Am. Econ. Rev. 2011, 101:470-492.
2. Adrian E.D. The impulses produced by sensory nerve endings: Part I. J. Physiol. 1926, 61:49-72.
3. Albrecht D.G., Geisler W.S. Motion selectivity and the contrast-response function of simple cells in the visual cortex. Vis. Neurosci. 1991, 7:531-546.
4. Albright T.D., Stoner G.R. Contextual influences on visual processing. Annu. Rev. Neurosci. 2002, 25:339-379.
5. Anstis S., Verstraten F.A., Mather G. The motion aftereffect. Trends Cogn. Sci. 1998, 2:111-117.
6. Arnold S.J., Oum T.H., Tigert D.J. Determinant attributes in retail patronage - seasonal, temporal, regional, and international comparisons. J. Mark. Res. 1983, 20:149-157.
7. Barbour D.L., Wang X. Contrast tuning in auditory cortex. Science 2003, 299:1073-1075.
8. Barlow H.B. Possible principles underlying the transformation of sensory messages. Sensory Communication 1961, MIT Press, Cambridge, MA. W.A. Rosenblith (Ed.).
9. Basso M.A., Wurtz R.H. Modulation of neuronal activity by target uncertainty. Nature 1997, 389:66-69.
10. Basso M.A., Wurtz R.H. Modulation of neuronal activity in superior colliculus by changes in target probability. J. Neurosci. 1998, 18:7519-7534.
11. Basten U., Biele G., Heekeren H.R., Fiebach C.J. How the brain integrates costs and benefits during decision-making. Proc. Natl. Acad. Sci. U.S.A. 2010, 107:21767-21772.
12. Bateson M., Healy S.D., Hurly T.A. Context-dependent foraging decisions in rufous hummingbirds. P. Roy. Soc. Lond. B Bio. 2003, 270:1271-1276.
13. Bertrand M., Karlan D., Mullainathan S., Shafir E., Zinman J. What's advertising content worth? Evidence from a consumer credit marketing field experiment. Q. J. Econ. 2010, 125:263-306.
14. Boatwright P., Nunes J.C. Reducing assortment: an attribute-based approach. J. Mark. 2001, 65:50-63.
15. Bonin V., Mante V., Carandini M. The suppressive field of neurons in lateral geniculate nucleus. J. Neurosci. 2005, 25:10844-10856.
16. Bonin V., Mante V., Carandini M. The statistical computation underlying contrast gain control. J. Neurosci. 2006, 26:6346-6353.
17. Brenner N., Bialek W., de Ruyter van Steveninck R. Adaptive rescaling maximizes information transmission. Neuron 2000, 26:695-702.
18. Britten K.H., Heuer H.W. Spatial summation in the receptive fields of MT neurons. J. Neurosci. 1999, 19:5074-5084.
19. Busemeyer J.R., Townsend J.T. Decision field theory: a dynamic-cognitive approach to decision-making in an uncertain environment. Psychol. Rev. 1993, 100:432-459.
20. Carandini M., Heeger D.J. Summation and division by neurons in primate visual cortex. Science 1994, 264:1333-1336.
21. Carandini M., Heeger D.J. Normalization as a canonical neural computation. Nat. Rev. Neurosci. 2011, 13:51-62.
22. Carandini M., Heeger D.J., Movshon J.A. Linearity and normalization in simple cells of the macaque primary visual cortex. J. Neurosci. 1997, 17:8621-8644.
23. Chernev A. Product assortment and individual decision processes. J. Pers. Soc. Psychol. 2003, 85:151-162.
24. Churchland A.K., Kiani R., Shadlen M.N. Decision-making with multiple alternatives. Nat. Neurosci. 2008, 11:693-702.
25. Coase R.H. The problem of social cost. J. Law. Econ. 1960, 3:1-44.
26. Dayan P., Niv Y., Seymour B., Daw N.D. The misbehavior of value and the discipline of the will. Neural Netw. 2006, 19:1153-1160.
27. De Martino B., Camerer C.F., Adolphs R. Amygdala damage eliminates monetary loss aversion. Proc. Natl. Acad. Sci. U.S.A. 2010, 107:3788-3792.
28. De Martino B., Kumaran D., Holt B., Dolan R.J. The neurobiology of reference-dependent value computation. J. Neurosci. 2009, 29:3833-3842.
29. De Martino B., Kumaran D., Seymour B., Dolan R.J. Frames, biases, and rational decision-making in the human brain. Science 2006, 313:684-687.
30. DeShazo J.R., Fermo G. Designing choice sets for stated preference methods: the effects of complexity on choice consistency. J. Environ. Econ. Manage. 2002, 44:123-143.
31. Dean I., Harper N.S., McAlpine D. Neural population coding of sound level adapts to stimulus statistics. Nat. Neurosci. 2005, 8:1684-1689.
32. Dhar R., Glazer R. Similarity in context: cognitive representation and violation of preference and perceptual invariance in consumer choice. Organ. Behav. Hum. Dec. 1996, 67:280-293.
33. Dorris M.C., Glimcher P.W. Activity in posterior parietal cortex is correlated with the relative subjective desirability of action. Neuron 2004, 44:365-378.
34. Eisenberger R. Learned industriousness. Psychol. Rev. 1992, 99:248-267.
35. Friedrich A.M., Zentall T.R. Pigeons shift their preference toward locations of food that take more effort to obtain. Behav. Process. 2004, 67:405-415.
36. Guitart-Masip M., Talmi D., Dolan R. Conditioned associations and economic decision biasewcs. Neuroimage 2010, 53(1):206-214.
37. Hare T.A., O'Doherty J., Camerer C.F., Schultz W., Rangel A. Dissociating the role of the orbitofrontal cortex and the striatum in the computation of goal values and prediction errors. J. Neurosci. 2008, 28:5623-5630.
38. Hariri A.R., Mattay V.S., Tessitore A., Fera F., Smith W.G., Weinberger D.R. Dextroamphetamine modulates the response of the human amygdala. Neuropsychopharmacology 2002, 27(6):1036-1040.
39. Hasenstaub A., Otte S., Callaway E., Sejnowski T.J. Metabolic cost as a unifying principle governing neuronal biophysics. Proc. Natl. Acad. Sci. U.S.A. 2010, 107:12329-12334.
40. Heeger D.J. Normalization of cell responses in cat striate cortex. Vis. Neurosci. 1992, 9:181-197.
41. Huber J., Payne J.W., Puto C. Adding asymmetrically dominated alternatives - violations of regularity and the similarity hypothesis. J. Consum. Res. 1982, 9:90-98.
42. Huber J., Puto C. Market boundaries and product choice - illustrating attraction and substitution effects. J. Consum. Res. 1983, 10:31-44.
43. Hurly T.A., Oseen M.D. Context-dependent, risk-sensitive foraging preferences in wild rufous hummingbirds. Anim. Behav. 1999, 58:59-66.
44. Iyengar S.S., Jiang W., Huberman G. How much choice is too much: determinants of individual contributions in 401K retirement plans. Pension Design and Structure: New Lessons from Behavioral Finance 2004, 83-97. Oxford University Press, Oxford. O.S. Mitchell, S. Utkus (Eds.).
45. Iyengar S.S., Lepper M.R. When choice is demotivating: can one desire too much of a good thing?. J. Pers. Soc. Psychol. 2000, 79:995-1006.
46. Kable J.W., Glimcher P.W. The neural correlates of subjective value during intertemporal choice. Nat. Neurosci. 2007, 10:1625-1633.
47. Kahneman D. Reference points, anchors, norms, and mixed feelings. Organ. Behav. Hum. Dec. 1992, 51:296-312.
48. Kahneman D., Knetsch J.L., Thaler R.H. Experimental tests of the endowment effect and the Coase theorem. J. Polit. Econ. 1990, 98:1325-1348.
49. Klein J.T., Deaner R.O., Platt M.L. Neural correlates of social target value in macaque parietal cortex. Curr. Biol. 2008, 18:419-424.
50. Kobayashi S., Pinto de Carvalho O., Schultz W. Adaptation of reward sensitivity in orbitofrontal neurons. J. Neurosci. 2010, 30:534-544.
51. Kohn A. Visual adaptation: physiology, mechanisms, and functional benefits. J. Neurophysiol. 2007, 97:3155-3164.
52. Koszegi B., Rabin M. A model of reference-dependent preferences. Q. J. Econ. 2006, 121:1133-1165.
53. Koszegi B., Rabin M. Reference-dependent risk attitudes. Am. Econ. Rev. 2007, 97(4):1047-1073.
54. Lehmann D., Pan Y. Context effects, new brand entry, and consideration sets. J. Mark. Res. 1994, 364-374.
55. Lesch K.P., Bengel D., Heils A., et al. Association of anxiety-related traits with a polymorphism in the serotonin transporter gene regulatory region. Science 1996, 274(5292):1527-1531.
56. Louie K., Glimcher P.W. Separating value from choice: delay discounting activity in the lateral intraparietal area. J. Neurosci. 2010, 30:5498-5507.
57. Louie K., Grattan L.E., Glimcher P.W. Reward value-based gain control: divisive normalization in parietal cortex. J. Neurosci. 2011, 31:10627-10639.
58. Louie K., Khaw M.W., Glimcher P.W. Normalization is a general neural mechanism for context-dependent decision making. Proc. Natl. Acad. Sci. USA 2013, 110:6319-6344.
59. Luce R.D. Individual Choice Behavior: a Theoretical Analysis 1959, Wiley, New York.
60. Maravall M., Petersen R.S., Fairhall A.L., Arabzadeh E., Diamond M.E. Shifts in coding properties and maintenance of information transmission during adaptation in barrel cortex. PLoS Biol. 2007, 5:e19.
61. McFadden D. Conditional logit analysis of qualitative choice behavior. Frontiers of Econometrics 1974, Academic Press, New York. P. Zarembka (Ed.).
62. McGuire J.T., Botvinick M.M. Prefrontal cortex, cognitive control, and the registration of decision costs. Proc. Natl. Acad. Sci. U.S.A. 2010, 107:7922-7926.
63. McNeil B.J., Pauker S.G., Sox H.C., Tversky A. On the elicitation of preferences for alternative therapies. N. Engl. J. Med. 1982, 306:1259-1262.
64. Morrison S.E., Salzman C.D. Re-valuing the amygdala. Curr. Opin. Neurobiol. 2010, 20:221-230.
65. Nagel K.I., Doupe A.J. Temporal processing and adaptation in the songbird auditory forebrain. Neuron 2006, 51:845-859.
66. Nieuwenhuis S., Heslenfeld D.J., von Geusau N.J., Mars R.B., Holroyd C.B., Yeung N. Activity in human reward-sensitive brain areas is strongly context dependent. Neuroimage 2005, 25(4):1302-1309.
67. Noonan M.P., Walton M.E., Behrens T.E., Sallet J., Buckley M.J., Rushworth M.F. Separate value comparison and learning mechanisms in macaque medial and lateral orbitofrontal cortex. Proc. Natl. Acad. Sci. USA. 2010, 107:20547-20552.
68. Ohshiro T., Angelaki D.E., DeAngelis G.C. A normalization model of multisensory integration. Nat. Neurosci. 2011, 14:775-782.
69. Ohzawa I., Sclar G., Freeman R.D. Contrast gain control in the cat visual cortex. Nature 1982, 298:266-268.
70. Ohzawa I., Sclar G., Freeman R.D. Contrast gain control in the cat's visual system. J. Neurophysiol. 1985, 54(3):651-667.
71. Olsen S.R., Bhandawat V., Wilson R.I. Divisive normalization in olfactory population codes. Neuron 2010, 66:287-299.
72. Ortoleva P. The price of flexibility: towards a theory of thinking aversion. J. Econ. Theory 2013, 148:903-934.
73. Padoa-Schioppa C. Range-adapting representation of economic value in the orbitofrontal cortex. J. Neurosci. 2009, 29:14004-14014.
74. Padoa-Schioppa C. Neurobiology of economic choice: a good-based model. Annu. Rev. Neurosci. 2011, 34:333-359.
75. Padoa-Schioppa C., Assad J.A. Neurons in the orbitofrontal cortex encode economic value. Nature 2006, 441:223-226.
76. Padoa-Schioppa C., Assad J.A. The representation of economic value in the orbitofrontal cortex is invariant for changes of menu. Nat. Neurosci. 2008, 11:95-102.
77. Pastor-Bernier A., Cisek P. Neural correlates of biased competition in premotor cortex. J. Neurosci. 2011, 31:7083-7088.
78. Paton J.J., Belova M.A., Morrison S.E., Salzman C.D. The primate amygdala represents the positive and negative value of visual stimuli during learning. Nature 2006, 439:865-870.
79. Payne J.W., Bettman J.R., Johnson E.J. The Adaptive Decision-Maker 1993, Cambridge, University Press, Cambridge; New York, NY, USA.
80. Plassmann H., O'Doherty J., Rangel A. Orbitofrontal cortex encodes willingness to pay in everyday economic transactions. J. Neurosci. 2007, 27:9984-9988.
81. Plassmann H., O'Doherty J., Shiv B., Rangel A. Marketing actions can modulate neural representations of experienced pleasantness. Proc. Natl. Acad. Sci. USA 2008, 105(3):1050-1054.
82. Platt M.L., Glimcher P.W. Neural correlates of decision variables in parietal cortex. Nature 1999, 400:233-238.
83. Plott C.R., Zeiler K. The willingness to pay-willingness to accept gap, the "endowment effect," subject misconceptions, and experimental procedures for eliciting valuations. Am. Econ. Rev. 2005, 95(3):530-545.
84. Rabinowitz N.C., Willmore B.D., Schnupp J.W., King A.J. Contrast gain control in auditory cortex. Neuron 2011, 70:1178-1191.
85. Ray P. Independence of irrelevant alternatives. Econometrica 1973, 41:987-991.
86. Reynolds J.H., Heeger D.J. The normalization model of attention. Neuron 2009, 61:168-185.
87. Rieke F., Rudd M.E. The challenges natural images pose for visual adaptation. Neuron 2009, 64:605-616.
88. Roesch M.R., Olson C.R. Neuronal activity related to reward value and motivation in primate frontal cortex. Science 2004, 304:307-310.
89. Roiser J.P., de Martino B., Tan G.C., Kumaran D., Seymour B., Wood N.W., et al. A genetically mediated bias in decision-making driven by failure of amygdala control. J Neurosci 2009, 29:5985-5991.
90. Roitman J.D., Brannon E.M., Platt M.L. Monotonic coding of numerosity in macaque lateral intraparietal area. PLoS Biol. 2007, 5:e208.
91. Rorie A.E., Gao J., McClelland J.L., Newsome W.T. Integration of sensory and reward information during perceptual decision-making in lateral intraparietal cortex (LIP) of the macaque monkey. PLoS One 2010, 5:e9308.
92. Rust N.C., Mante V., Simoncelli E.P., Movshon J.A. How MT cells analyze the motion of visual patterns. Nat. Neurosci. 2006, 9:1421-1431.
93. Salgano, M., 2006. Choosing to have less choice. Working Paper, Northwestern University.
94. Schwartz O., Hsu A., Dayan P. Space and time in visual context. Nat. Rev. Neurosci. 2007, 8:522-535.
95. Shadlen M.N., Newsome W.T. The variable discharge of cortical neurons: implications for connectivity, computation, and information coding. J. Neurosci. 1998, 18:3870-3896.
96. Shafir S., Waite T.A., Smith B.H. Context-dependent violations of rational choice in honeybees (Apis mellifera) and gray jays (Perisoreus canadensis). Behav. Ecol. Sociobiol. 2002, 51:180-187.
97. Shapley R.M., Enroth-Cugell C. Visual adaptation and retinal gain control. Prog. Ret. Res. 1984, 3:263-346.
98. Shapley R.M., Victor J.D. The effect of contrast on the transfer properties of cat retinal ganglion cells. J. Physiol. 1978, 285:275-298.
99. Shulman R.G., Rothman D.L., Behar K.L., Hyder F. Energetic basis of brain activity: implications for neuroimaging. Trends Neurosci. 2004, 27:489-495.
100. Simoncelli E.P., Olshausen B.A. Natural image statistics and neural representation. Annu. Rev. Neurosci. 2001, 24:1193-1216.
101. Simonson I., Tversky A. Choice in context - tradeoff contrast and extremeness aversion. J. Mark. Res. 1992, 29:281-295.
102. Smirnakis S.M., Berry M.J., Warland D.K., Bialek W., Meister M. Adaptation of retinal processing to image contrast and spatial scale. Nature 1997, 386:69-73.
103. Smith V.L., Walker J.M. Monetary rewards and decision cost in experimental economics. Econ. Inq. 1993, 31:245-261.
104. Soltani A., De Martino B., Camerer C.F. A range-normalization model of context-dependent choice: a new model and evidence. PLOS Comput. Biol 2012, 8:e1002607.
105. Sugrue L.P., Corrado G.S., Newsome W.T. Matching behavior and the representation of value in the parietal cortex. Science 2004, 304:1782-1787.
106. Thaler R. Toward a positive theory of consumer choice. J. Econ. Behav. Organ. 1980, 1(1):39-60.
107. Thaler R.H., Johnson E.J. Gambling with the house money and trying to break even: the effects of prior outcomes on risky choice. Manage. Sci. 1990, 36:643-660.
108. Tolhurst D.J., Movshon J.A., Dean A.F. The statistical reliability of signals in single neurons in cat and monkey visual cortex. Vis. Res. 1983, 23:775-785.
109. Tom S.M., Fox C.R., Trepel C., Poldrack R.A. The neural basis of loss aversion in decision-making under risk. Science 2007, 315:515-518.
110. Tremblay L., Schultz W. Relative reward preference in primate orbitofrontal cortex. Nature 1999, 398:704-708.
111. Tversky A. Elimination by aspects - a theory of choice. Psychol. Rev. 1972, 79:281-299.
112. Tversky A., Kahneman D. The framing of decisions and the psychology of choice. Science 1981, 211:453-458.
113. Tversky A., Shafir E. Choice under conflict - the dynamics of deferred decision. Psychol. Sci. 1992, 3:358-361.
114. Tversky A., Simonson I. Context-dependent preferences. Manage. Sci. 1993, 39:1179-1189.
115. Usher M., McClelland J.L. Loss aversion and inhibition in dynamical models of multialternative choice. Psychol. Rev. 2004, 111:757-769.
116. von Neumann J., Morgenstern O. Theory of Games and Economic Behavior 1944, Princeton University Press, Princeton.
117. Wallis J.D., Miller E.K. Neuronal activity in primate dorsolateral and orbital prefrontal cortex during performance of a reward preference task. Eur. J. Neurosci. 2003, 18:2069-2081.
118. Weber B., Rangel A., Wibral M., Falk A. The medial prefrontal cortex exhibits money illusion. Proc. Natl. Acad. Sci. USA 2009, 106(13):5025-5028.
119. Webster M.A., Kaping D., Mizokami Y., Duhamel P. Adaptation to natural facial categories. Nature 2004, 428:557-561.
120. Zoccolan D., Cox D.D., DiCarlo J.J. Multiple object response normalization in monkey inferotemporal cortex. J. Neurosci. 2005, 25:8150-8164.