Preference Heterogeneity And Consistency

In this paper, through an integrated use of theoretical modeling, neuroscience experimenting, and economic thoughts exploring, I probed the theme about consistency and heterogeneity of preferences. Firstly, I proposed a neuroeconomics theory of preferences and constructed a rough formal model of content-dependent preference, then run two brain-stimulating neuroscience experiments to test this theory. As a foreshadowing of these moves, I had briefly studied the history of economic theory of preferences, in a unique perspective of "human being, the lost".The overall content of the paper might be seen as two blocks. The first one is a theoretical construct, and its natural start point is the intrinsic nature of preferences. Inner preferences, as emergency phenomena in the process of decision-making, are results of neural computation. In order to analyze inner preferences, we should delve into the decision-making process. The rapid progress of modern science and technology, and the enormous growing neural data, provide us with a great opportunity to study the preferences from the perspective of neuroeconomics.This paper presents a new model of the decision-making process, which is divided into 4 phases:perception, valuation, choice, and evaluation. In each stage, the neural computation processes are context-dependent, which is the neural basis of preference context-dependency. This new decision-making process model provides us with a framework for neuroeconomics research of preferences. Then, some new concepts, such as neural correlates of preference, multi-drafts of preference and neural revealed preferences are developed. Expanding this theme, the multi-drafts of preferences form in the perception phase, which is very important, although not many neuroeconomists fully aware it. This paper emphasizes the importance of the context identification and classification in perception phase. In the valuation phase, by the competing presence of three categories of valuation systems, Pavlovian systems, habitual systems and goal-directed systems, a lot of kinds of actions are assigned values, and thus serve to instantiate the inner preferences. Context-dependency of preferences in the valuation phase is largely endowed by the emotional systems’ modulation of the three categories of valuation systems. The choice from actions occurs in the frontal-parietal choice circuit, which is the final common path of action and choice. The driving value signals from valuation systems induces the choice, either through a winner-take-all "argmax" operation, or through an evidence-accumulating-to-a-threshold process and thus gives rise to the neural revealed preferences. The final phase is the evaluation of outcomes, which the experience utility experienced. Evaluation gives rise to another kind of important value signals, not directly for decision making, but act as input to learning processes, and the latter serve to adjust and update all other decision-making phases. One advantage of this framework lies in its inclusiveness. Some people think that there are two or more types of decision-making systems/processes, but it is not the case, they might wrongly treat some phase (or even some subsystems of a phase) of a decision-making as a distinctive decision-making.Secondly, in this paper, the context-dependency of neuronal coding is revealed, which is bottle deep neural basis of the context-dependency of preferences. Due to natural constraint of firing rate (neither negative nor too high), the neuronal consistent coding can be implemented only through gain control, which is instantiated by two specific mechanisms:normalization and adaptation. The former reflects special context, and the latter temporal context.Based on the above points, the paper develops a formal model of context-dependent preferences. The essence of the model is built on the concept of preference over binary group consists of context and value. Although still very rough, but it may become the fist step of a unified, simple, testable neuroeconomics preference model.Another focus of this paper is experimental tests. To verify the context-dependency of preferences, we use transcranial direct current stimulation (tDCS) to run 2 brain stimulation experiments. The first is to test risk preference, and tDCS stimulation target is the right dorsal lateral prefrontal cortex (rDLPFC), because previous studies have shown that this brain area closely related to risky decision-making. And the second experiment is to test moral preferences, and the target is temporal parietal junction (TPJ), which is the hot points of theory of mind network and closely related to the belief attribution in moral judgment. Experimental results show that, due to the context-dependency, in decision-making process, human preferences show significant heterogeneity, but when faced with the same context, their preferences consistently satisfy the Preference consistency axiom. Thus, given their preferences, coupled with the contextual information, it is plausible to maintain consistency of preference. Thus, using the empirical data from behavioral experiments and neuroscience experiments, we should able to generalize a general premise, that is, the "context-dependent preferences consistency axiom".