The Neurobiological Foundations of Valuation in Human Decision Making under Uncertainty

This chapter focuses on valuation in the context of choice under uncertainty. When valuation is a pursuit distinct from choice, values revealed through choice may be different from the valuations that emerge from the (choice-independent) computations. In many human endeavors, valuation is performed even in the absence of any immediate necessity to choose. Again, finance is a case in point, in part because financial valuation is often complex and time-consuming, while good choice opportunities are rare and short-lived. The cost of computing values provides a normative rationale for why valuation may be done in the absence of free choice. In fact, the neurobiological choice model predicts choices better than a utility-index-based model estimated from the choices themselves. This demonstrates not only that valuation is done during imperative trials, but that the resulting values are relevant for choice in free-choice trials as well. Although brain activation during imperative trials reflects valuations that are compatible with the values revealed in free-choice trials, and hence that brain activation in imperative trials can be used to predict choice in free-choice trials, the fit is not 100%. These neurobiological data suggest that there are two value signals: one revealed through activation in brain regions, not directly involved in the physical implementation of choice, and a second one revealed through activation of the neurons controlling the physical act of choice.