Volume 29, Issue 2
DOI: 10.24205/03276716.2020.269
INFLUENCE OF PREFERENCE EFFECT ON ECONOMIC DECISION-MAKING: AN ANALYSIS OF ELECTROENCEPHALOGRAM SIGNALS
Abstract
This paper mainly explores the influence of preference effect on economic decision-making based on the analysis of electroencephalogram (EEG) signals. First, two experiments were carried out, including a preference behavior experiment and an event related potential (ERP) experiment. During the experiments, two EEG components that are sensitive to economic feedback information were recorded, namely, feedback-related negativity (FRN) wave and P300 wave. Next, the influence law of preference effect on economic decision-making was analyzed based on the recorded data. The results show that the difference in preference behavior in the economic field is significantly higher than that in social, entertainment, and ethical fields; decision-makers are highly sensitive to feedback information about economic returns and losses, and the sensitivity to losses is higher than that to economic returns; the FRN waves mainly appear in the forehead area, while P300 waves mainly appear in the back of the scalp; there is a significant difference between the amplitudes of the FRN and P300 EEG signals induced by economic returns and losses, which are far from the preference values, and the inverse is also true. The research results provide new insights to the rationality of economic decision-making.
Keywords
Preference Effect, Electroencephalogram (EEG) Signals, Economic Decision, Feedback-Related Negativity (FRN) wave, P300 Wave.