The Wall Street Journal

October 12, 2007


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-- by Robert Lee Hotz
[Recommended Reading]
In the first full-length book on neuroeconomics,4 "Decisions, Uncertainty, and the Brain: The Science of Neuroeconomics," New York University's Paul Glimcher argues that economic theory may provide a new way to think about the brain and behavior.
* * *
In the Journal of Economic Literature, economists Colin Camerer, George Loewenstein and Drazen Prelec lay out the case for using neuroscience to revolutionize traditional economics.5
* * *
In "Nature: An Economic History," Geerat Vermeij, an evolutionary biologist at the University of California at Davis, explores biology, economics and geology to show how processes common to all economic systems govern evolution.6
* * *
The "Handbook of Functional Neuroimaging of Cognition," edited by neuroscientists Roberto Cabeza7 and Alan Kingstone,8 explains the imaging techniques used to study the neural basis of cognition.9
* * *
Until the 17th century, people thought the human brain was a curious lump of animate curds. Its discovery as the seat of human consciousness is a whodunit of science history10 told by Carl Zimmer in "Soul Made Flesh."
* * *
The Web site for the Canaan Children's Home11 in Uganda.
* * *
The web site for the Caltech Imaging Center.12

Charting the Agony
Of a Brain as It
Struggles to Be Fair
October 12, 2007; Page B1

At the Canaan Children's Home in southern Uganda, the orphans had no idea that a woman inside a brain scanner 9,400 miles away was playing mind games with their food.

The children were the focus of a brain experiment under way at the California Institute of Technology to explore the neural anatomy of indecision. With the push of a button, the woman in the Caltech scanner could distribute meals at the orphanage more fairly, but only by taking food off the table, not by serving more portions.

While she pondered, the 12-ton fMRI scanner at the university's brain-imaging center traced the synaptic patterns of equity, remorse and reward in her brain. In these riptides of neural currents, the researchers sought clues to human variables missing from the mathematics of conventional economics.

Ever wonder why you make such bad investment decisions?2 What happens in your head when logic and rationality take a backseat? Share your thoughts with Robert Lee Hotz and other readers on the Science forum3.

The quirky experiment exemplifies the new field of neuroeconomics. Behavioral economist Ming Hsu and his Caltech colleagues combined financial-decision theories and medical brain-imaging tools to analyze the brain as a living engine of economics, one fine-tuned by evolution through eons of foraging for scarce resources. These scientists studied hard choices, documenting how competing networks of neurons unconsciously shape the way we buy, sell, risk and trust.

During this test, the scientists wanted to see how synapses valued fairness against the desire to avoid harming others. The dilemma can arise when a limited resource is distributed unequally, and the only way to help one person comes at another's expense -- whether in profit sharing, setting affirmative-action policy, or rationing health care.

In the summer of 2006, when they organized the test, Dr. Hsu and his colleagues could imagine no more agonizing choice, within the constraints of medical ethics, than to ask people to take food away from orphans in a war-torn African country.

An online search led them to the Web site for the Canaan Children's Home, a one-story green building with a clinic next door, set amid the trees and chicken coops a half hour's drive from Jinja, Uganda. As of April, 100 children were living there, many of them orphaned by AIDS, said Frank P. Crane in Richmond, Va., chairman of the Uganda Missions Action Committee, which monitors the home's finances.

It was the winsome faces of those children -- whose photographs had been posted on the Web site to solicit charitable donations -- that caught Dr. Hsu's science eye. Here was the perfect experimental device for stirring the turmoil of indecision, the researchers agreed.

The team next contacted Tom Roberts, an attorney in Richmond, who created the Web site. He gave consent for the photos to be used. Because there would be no contact with the children and no actual consequences of the experiment to the orphanage, "I said help yourself," Mr. Roberts recalled.

Dr. Hsu wanted the pictures to heighten the realism of the experiment.

In the scanner, each volunteer could equalize how a fixed amount of donated meals was shared between orphans -- but only by taking away meals from those who had more than others and thereby reducing the total number of meals given to the orphanage. The allocation of meals was sometimes fair, sometimes not. "We manipulated the allocations and how much could be taken away," Dr. Hsu said.

To trigger the brain behavior, the 26 volunteers had to believe their decisions really would affect orphans being denied their seat at a groaning board of plenty where others feasted. So, the experimenters made them all study a 10-page brochure with pictures of 60 orphans.

In 36 rounds of testing, each subject had 10 seconds to choose the lesser of two evils: Allow some children to keep more than their fair share of meals or take away their food to eliminate inequity.

It was a measure of the economics of morality. Dr. Hsu made the inequities more or less severe by changing the number of meals donated to different groups of children. That provoked patterns of neural activation that revealed the brain's distaste for injustice and its willingness if the disparity was wide enough -- in one case, one child receiving five times more than another -- to punish the rich by putting them on short rations. To redress the extremes, people were willing to confiscate meals even when it hurt the orphanage as a whole, Dr. Hsu, now at the University of Illinois, reported recently at a meeting of the Society for Neuroeconomics in Nantasket, Mass.

As a test of economic theory against the benchmark of the brain, the Uganda experiment is one subtle brushstroke in an emerging self-portrait of the mind, generated by floods of new brain data. Indeed, neuroeconomics itself is still so new that cultural anthropologists from the Massachusetts Institute of Technology and New York University are documenting the folkways of this nascent network of scholars.

"The payout for this in economics may not come for 20 years," said University of Zurich economist Ernst Fehr. "Economics is a slow science."

 Email me at sciencejournal@wsj.com13. For a discussion on this column, go to the Science Journal forum14.
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