We investigated behavioral and neurobiological mechanisms by which risk-averse advice,provided by an expert, affected risky decisions across three developmental groups [earlyadolescents (12-14 years), late adolescents (15-17 years), adults (18+ years)]. Using cumulativeprospect theory, we modeled choice behavior during a risky-choice task. Results indicate thatadvice had a significantly greater impact on risky choice in both adolescent groups than in adults.Using functional magnetic resonance imaging, we investigated the neural correlates of thisbehavioral effect. Developmental effects on correlations between brain activity and valuationparameters were obtained in regions that can be classified into (i) cognitive control regions, such asdorsolateral prefrontal cortex (DLPFC) and ventrolateral PFC; (ii) social cognition regions, such asposterior temporoparietal junction; and (iii) reward-related regions, such as ventromedial PFC(vmPFC) and ventral striatum. Within these regions, differential effects of advice on neuralcorrelates of valuation were observed across development. Specifically, advice increased thecorrelation strength between brain activity and parameters reflective of safe choice options inadolescent DLPFC and decreased correlation strength between activity and parameters reflective ofrisky choice options in adult vmPFC. Taken together, results indicate that, across development,distinct brain systems involved in cognitive control and valuation mediate the risk-reducing effectof advice during decision making under risk via specific enhancements and reductions of thecorrelation strength between brain activity and valuation parameters.
Human altruism shaped our evolutionary history and pervades social and political life. There are,however, enormous individual differences in altruism. Some people are almost completely selfish,while others display strong altruism, and the factors behind this heterogeneity are only poorlyunderstood. We examine the neuroanatomical basis of these differences with voxel-basedmorphometry and show that gray matter (GM) volume in the right temporoparietal junction (TPJ)is strongly associated with both individuals' altruism and the individual-specific conditions underwhich this brain region is recruited during altruistic decision making. Thus, individual differencesin GM volume in TPJ not only translate into individual differences in the general propensity tobehave altruistically, but they also create a link between brain structure and brain function byindicating the conditions under which indi
As the first, substantive contribution, this paper revisits the effectiveness of two widely used public sponsored training programs, the first one focusing on intensive occupational training and the second one on short-term activation and job entry. We use an exceptionally rich administrative data set for Germany to estimate their employment and earnings effects in the early 2000s. We employ a stratified propensity score matching approach to address dynamic selection into heterogeneous programs. As a second, methodological contribution, we carefully assess to what extent various aspects of our empirical strategy such as conditioning flexibly on employment and benefit histories, the availability of rich personal information, handling of later program participations, and further methodological and specification choices affect estimation results. Our results imply pronounced negative lock-in effects in the short run in general and positive medium-run effects on employment and earnings when job-seekers enroll after having been unemployed for some time. We find that data and specification issues can have a large effect on impact estimates.
van Honk and colleagues have taken our findings on the role of testosterone in ultimatum gamebargaining1 a step forward by showing that the hormone has important prosocial effects beyondthe ultimatum game by increasing cooperation in the public goods game (PGG)2. In contrast to theultimatum game, participants in the PGG decide simultaneously about their cooperation levels andare not confronted with a rejection threat from other participants, suggesting a much moreuniversal effect of testosterone on prosociality than revealed by our study1. As the PGG captures alarge class of evolutionarily and contemporaneously important situations, their findings are ofgreat interest, and considerably extend our knowledge about the causal effect of testosterone onsocial behaviour. In addition, their results raise intriguing questions regarding the motivationaland biological mechanisms through which testosterone increased cooperation levels, suggestingthat the study will trigger further important experiments.
Psychosocial stress precipitates a wide spectrum of diseases with major public-health significance.The fight-or-flight response is generally regarded as the prototypic human stress response, bothphysiologically and behaviorally. Given that having positive social interactions before beingexposed to acute stress plays a preeminent role in helping individuals control their stressresponse, engaging in prosocial behavior in response to stress (tend-and-befriend) might also be aprotective pattern. Little is known, however, about the immediate social responses followingstress in humans. Here we show that participants who experienced acute social stress, induced bya standardized laboratory stressor, engaged in substantially more prosocial behavior (trust,trustworthiness, and sharing) compared with participants in a control condition, who did notexperience socioevaluative threat. These effects were highly specific: Stress did not affect thereadiness to exhibit antisocial behavior or to bear nonsocial risks. These results show that stresstriggers social approach behavior, which operates as a potent stress-buffering strategy in humans,thereby providing evidence for the tend-and-befriend hypothesis.
We employ laboratory methods to study stability of competitive equilibrium in Scarf's economy (International Economic Review, 1960). Tatonnement theory predicts that prices are globally unstable for this economy, i.e. unless prices start at the competitive equilibrium they oscillate without converging. Anderson et al. (Journal of Economic Theory, 2004) report that in laboratory double auction markets, prices in the Scarf economy do indeed oscillate with no clear sign of convergence. We replicate their experiments and confirm that tatonnement theory predicts the direction of price changes remarkably well. Prices are globally unstable with adverse effects for the economy's efficiency and the equitable distribution of the gains from trade. We also introduce a novel market mechanism where participants submit demand schedules and prices are computed using Smale's global Newtonian dynamic (American Economic Review, 1976). We show that for the Scarf economy, submitting a competitive schedule, i.e. a set of quantities that maximize utility taking prices as given, is a weakly dominant strategy. The resulting outcome corresponds to the unique competitive equilibrium of the Scarf economy. In experiments that employ the schedule market, prices do not oscillate but instead converge quickly to the competitive equilibrium. Besides stabilizing prices, the schedule market is more efficient and results in highly egalitarian outcomes.
