The Neuroeconomics of Environmental Decision-Making: Individual Differences and Behavior

Abstract:
Human decisions are equally capable of creating and mitigating severe global and local environmental challenges. How do we best understand that decision process, in order to facilitate choices that are better for the environment? Advances in neuroimaging over the last two decades permit the visualization and quantification of the complex brain activity which gives rise to our decisions and behaviors. This dissertation utilizes FMRI and behavioral economics experiments as well as psychometric and econometric national surveys to examine environmental decision-making, and the factors which motivate individual differences in the decision process. The studies focus on two main areas: how we value natural resources, and the implications for environmental philanthropy, as well as consumer purchasing behavior on items with eco-labeled and energy-efficient options.

The first pair of studies on environmental philanthropy asked participants to donate their own money to protect park lands threatened by new land uses, which provided the answers to a number of questions: How do we process environmental threats and iconic landscapes? Which neural responses can predict donations, or predict keeping the money for one's self? Do those responses change in more pro-environmental individuals?

The studies on consumer behavior focused on purchases of CFL light bulbs, using a nationwide stated choice survey of 1,550 homeowners as well as an FMRI purchasing task. Individual differences (e.g., numeracy, pro-environmental attitudes) associated with the undervaluation and overvaluation of savings on energy costs were identified, as well as the degree to which an Energy Star eco-label could influence this investment in energy efficiency. The subsequent FMRI study found that CFL purchasing was predicted by distinct regions in different types of consumers (e.g., individuals with high versus low discount rates). Across the study population, CFL purchases were positively predicted by activity in the ventral striatum (associated with positive emotions); this activity increased when the Energy Star label was present. 

This research represents the first encouraging foray into using neuroscience to study environmental decisions. By understanding the neural regions which predict decision-making, the response of those regions to behavioral nudges such as the Energy Star, and the individual differences associated with those responses, it presents a more nuanced view of the motivations underlying our environmental choices.