a basic assumption of rational choice theory, empirical evidence shows that humans are not good intuitive calculators of risk and benefit. Second, there is considerable individual variation in human decision making, mediated not only by biases such as risk aversion, ambiguity aversion, and choice blindness, but by variations in numeracy—all neural operations potentially subject to genetic and epigenetic variation. Both intra- and interindividual variation occurs in emotional biasing of decisions. Emotional framing, for instance, makes brains process moral options with different tissue and outcomes. Innate and acquired variation may alter decision calculus. Fourth, recent research has identified systematic cultural-bound differences in punishment decisions. These recent findings may be especially relevant to the analysis of Islamist extremist behaviors; compared with most Westerners, those in some Middle Eastern societies appear more willing to engage in costly and irrational “antisocial punishment,” which may take the form of vengeance even when such actions are self-defeating.
All these real-world violations of economic prediction are sometimes excused as so-called bounded rationality—the claim that hominids simply lack the calculating capacity for reliable self-interested choice (Simon, 1955). It is possible that one major conceptual error underlying the misguided enthusiasm for rational choice models is the untenable assumption that human brains are serial processors (Simon, 1967). Although some authorities cling to the framework of quantitative predictive validity by calling their new calculus “neuroeconomics,” far too many deviations from rational economic predictions have been observed to sustain a hypothesis that economic balancing of expected risks and benefits plays a major role in the occurrence of most human actions. Newer models of decision making at least acknowledge an element of random or stochastic choice that only slowly drifts toward reward maximization (Soltani et al., 2006). Revising the rational choice/econometric theories of the past, a new generation of scholars is exploring the interaction between emotions and decision making.
The deep philosophical issue that lurks beneath these investigations is the popular assumption of free will. That issue cannot be addressed adequately in this brief essay. Suffice it to say that, from the biologist’s perspective, the evidence for human free will is just as robust as the evidence for precognition. The illusion of free will is perhaps best regarded as a curious adaptation, perhaps confined to species with cortices, the value of which remains to be elucidated.
Still, rather than considering the overwhelming evidence of rationality violations as debunking a myth of rational man, I propose that such discoveries open the door to refinements that will lead to a better, wiser, biologically informed psychoneuroeconomics. Human actions on this earth are determined by actions in brains. Actions in brains are determined by physical laws, the investigation of which remains in its early infancy. That