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RESEARCH PRODUCT

Emotions in Economic Decision Making: A Multidisciplinary Approach

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AbstractAccording to classical and neoclassical economics, decisions are made based on information and cost-benefit analysis. In reality, the decision making process is much more complex than previously thought, because it also involves psychological factors. Decision making is interdisciplinary, researched by psychologists, sociologists, economists, philosophers, neuroscientists and others. These fields have distinctive and common concepts about decision making. The aim of this paper is to identify what role emotions play in the economic decision making process. The paper focuses on describing and explaining the interconnection of sciences, such as economics, psychology and neuroscience, by researching the effect of emotions on the economic decision making process. Behavioural economics researches the psychological foundations of economic behaviour, and neuroeconomics researches brain activities related to economic behaviour. Evidences from behavioural economics, psychology and neuroeconomics show the importance and necessity of emotions in the economic decision making process. The findings of the paper reveal that economics, by incorporating the research results of other sciences, in the economic theory of the decision making process, may gain a more accurate and realistic understanding of this complex field of research.