Remember the axiom that “a bird in the hand is worth two in the bush?” Whether through experience, games theory, or shortsightedness, that homespun cultural wisdom impacts most people’s decisions which affect their present and future economic well-being. Like Homer Simpson, they would rather eat their donuts now than enjoy twice as many in the future.
That conflict formed the crux of MIT anthropology professor Natasha Schull’s presentation “Neuroeconomics and the Governance of Choice” at the University of Minnesota’s Cowles Auditorium Thursday noon. Along with University of Minnesota law professor Francis X. Shen, she addressed the issue of whether people are purely rational actors in their economic decisions and the impact their decisions can have on public policy.
For most of America’s history, public policy was based on economists’ conceptions of people’s dual brain nature. They were either impulsive like Homer or rational like Star Trek’s Mister Spock, and public policy reflected the traditional notion that people always employed their rational selves to maximize their well-beings. But substantial evidence shows that people often act impulsively and overvalue the present; consequently, neuroscientists replaced the “dual hypothesis [of the brain as] a vulgar simplification” with the “unified brain” where emotion and rationality conjoin to form “an integrated set of systems” that informs decision-making.
But the “one-brain” concept“dilutes the capacity of rationality and destabilizes the long-standing tenet of liberal governance” that has impacted decision-making through the application of education, coaching, and pharmaceuticals. New approaches, such as Richard Thaler’s libertarian paternalism, could be employed “to motivate the inner Vulcan in all of us,” according to Dr. Schull
Government policy based on such new concepts is difficult to imagine, however. Dr. Shen voiced his own reservations by asking the audience “What does this brain stuff get you?” Terms such as “shortsighted” and “brain analytics” tend to load the debate when an analysis of people’s behavior “gets us pretty darn far” in terms of decision-making. Though “neurolaw” is now part of the legal lexicon, Shen doubted whether neuroscience has “anything to do with law and policy.”
The question-and-answer session that followed reflected audience members’ misgivings about real world applications. Though they appreciated the new-found complexity neuroeconomics added to their inner lives, they remained skeptical about how these new concepts impacted issues like the sequestration of the federal budget. Better than anything stated yesterday, our national representatives’ indecisiveness exemplifies the Homer that dominates everyone’s behavior.