Motivational system modulates brain responses during exploratory decision-making

Managers face risk in explorative decision-making and those who are better at such decisions can achieve future viability. To understand what makes a manager effective at explorative decision-making requires an analysis of the manager’s motivational characteristics. The behavioral activation/inhibition system (BAS/BIS), fitting the motivational orientation of “approach” or “avoidance,” can affect individual decision-making. However, very little is known about the neural correlates of BAS/BIS orientation and their interrelationship with the mental activity during explorative decision-making. We conducted an fMRI study on 111 potential managers to investigate how the brain responses of explorative decision-making interact with BAS/BIS. Participants were separated into high- and low-performance groups based on the median exploration-score. The low-performance group showed significantly higher BAS than that of the high-performance group, and its BAS had significant negative association with neural networks related to reward-seeking during explorative decision-making. Moreover, the BIS of the low-performance group was negatively correlated with the activation of cerebral regions responding to risk-choice during explorative decision-making. Our finding showed that BAS/BIS was associated with the brain activation during explorative decision-making only in the low-performance group. This study contributed to the understanding of the micro-foundations of strategically relevant decision-making and has an implication for management development.

Review of “Risk, Choice, and Uncertainty: Three Centuries of Economic Decision-Making” by George G. Szpiro

Review of “Risk, Choice, and Uncertainty: Three Centuries of Economic Decision-Making” by George G. Szpiro

Overtime risk preference and its determinants: Evidence from Indonesia

<p>This research aims at examining the potential determinants of overtime risk preference in Indonesia–one of the most diverse countries in the world. We used household and individual data as well, taken from the fourth and fifth wave of the Indonesia Family Life Survey (IFLS). The risk aversion of the individual was observed and elicited using hypothetical gambling questions. From the result of Ordinary Least Square (OLS) estimation, we find preliminary evidence that there is a decrease in risk-aversion among individuals over time. However, there is little evidence that catastrophe will alter risk choice as a proxy for a significant life event. Furthermore, our empirical finding also revealed that risk tolerance is motivated not only by demographic factors but also by the education level and individual’s time preference.</p><p> </p><p> </p><div id="gtx-anchor" style="position: absolute; visibility: hidden; left: 278px; top: 80px; width: 27px; height: 12px;"> </div><div class="jfk-bubble gtx-bubble" style="visibility: visible; left: -131px; top: 102px; opacity: 1;"> </div><div id="gtx-anchor" style="position: absolute; visibility: hidden; left: 278px; top: 80px; width: 27px; height: 12px;"> </div><div class="jfk-bubble gtx-bubble" style="visibility: visible; left: -131px; top: 102px; opacity: 1;"> </div>