October 29, 2008 Brain imaging uncovers why people overbid at auctions New York University neuroscientists and economists have combined functional MRI with behavioral economic research to discover why people tend to overbid for products sold at auction: fear of losing a social competition. The next step may be explaining irrational Wall Street behavior. Functional MRI was used to examine brain activation patterns while volunteers played either an auction game with a partner or a lottery game. In both instances, participants could either win or lose money. Winning the auction game, however, depended on outbidding a partner, a key social difference that could be seen in variations of activation in the striatum. Past fMRI studies have linked the striatum with reward-related brain activity.
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