Dopamine, reward prediction error, and economics

Andrew Caplin, Mark Dean

    Research output: Contribution to journalArticle

    Abstract

    The neurotransmitter dopamine has been found to play a crucial role in choice, learning, and belief formation. The best-developed current theory of dopaminergic function is the "reward prediction error" hypothesis-that dopamine encodes the difference between the experienced and predicted "reward" of an event. We provide axiomatic foundations for this hypothesis to help bridge the current conceptual gap between neuroscience and economics. Continued research in this area of overlap between social and natural science promises to overhaul our understanding of how beliefs and preferences are formed, how they evolve, and how they play out in the act of choice.

    Original languageEnglish (US)
    Pages (from-to)663-701
    Number of pages39
    JournalQuarterly Journal of Economics
    Volume123
    Issue number2
    DOIs
    StatePublished - May 1 2008

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    ASJC Scopus subject areas

    • Economics and Econometrics

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