Research in behavioural economics focuses on how people make decisions rather than normatively describing optimal decision making of a fictitious “homo oeconomicus”. In recent years one could observe a rising interest among economists in psychological and neurobiological mechanisms underlying economic decision making, but environmental or internal conditions of decision makers have been largely ignored. Psychological research indicates that one such factor that can strongly influence decision making (and cognitive processes in general) is stress. Economic decisions indeed often have to be taken under stress, e.g., under time pressure, high job demands, competition, or threat of job loss. Stress, both acute and chronic, has been found to influence working memory functioning, feedback learning, and other higher cognitive functions that are important for decision making, suggesting that stress should also influence economic decision making. This project will systematically investigate the effects of acute and chronic stress on economic decision making, using laboratory experiments. Given that gender differences in stress responsiveness are well documented, we furthermore hypothesize that differences in stress responses can help explaining some of the heterogeneities found in economic research.
DFG Programme
Research Grants
