Using Experts to Avoid Critical Thinking?


All advisors and professionals working in wealth management and retirement need to be careful of this effect since they may be culpable when their clients executes harmful decisions. 


from the Neuronarrative blog 26, 2009…5:01 PM

“What Does Expert Advice Really Do to Our Brains?

.…expert advice causes the brain to “offload” calculations of expected utility (loss or gain) when making a financial decision under risk. 

  • The brain defers to the expert when first given expert advice
  • If then immediately challenged to make a decision, we’d also expect someone to go ahead with the expert’s advice
  • The expert’s advice gets folded into a more lengthy process of figuring out the right way to go
  • That process will probably include information from other sources, perhaps other experts, family members impacted by the decision, associates who have faced similar decisions, etc.

To sum up – immediately upon receiving expert advice, the brain appears to offload value calculations and the words of the expert carry the day.

Driven by Dopamine: Inherited Brain Basis of "Success"


We are looking very closely at dopamine because it appears to be the basis for bad investment decision making and many other life problems.  We were surprised, however, to see this.


Brain Dopamine Receptor Density Correlates with Social Status 
Philadelphia, February 3, 2010

“People have typically viewed the benefits that accrue with social status primarily from the perspective of external rewards. A new paper in the February 1st issue of  Biological Psychiatry, published by Elsevier suggests that there are internal rewards as well.

Dr. Martinez and colleagues found that increased social status and increased social support correlated with the density of dopamine D2/D3 receptors in the striatum, a region of the brain that plays a central role in reward and motivation, where dopamine plays a critical role in both of these behavioral processes.

This data suggests that people who achieve greater social status are more likely to be able to experience life as rewarding and stimulating because they have more targets for dopamine to act upon within the striatum.

Dr. Martinez explains their findings: “We showed that low levels of dopamine receptors were associated with low social status and that high levels of dopamine receptors were associated with higher social status.

The same type of association was seen with the volunteer’s reports of social support they experience from their friends, family, or significant other.” 

Dr. John Krystal, Editor of Biological Psychiatry commented, “These data shed interesting light into the drive to achieve social status, a basic social process. It would make sense that people who had higher levels of D2 receptors, i.e., were more highly motivated and engaged by social situations, would be high achievers and would have higher levels of social support.”

These data also may have implications for understanding the vulnerability to alcohol and substance abuse, as the work of Dr. Nora Volkow, the Director of the National Institute on Drug Abuse, and colleagues

…suggests that low levels of D2/D3 receptors may contribute to the risk for alcoholism among individuals who have family members who abuse alcohol. The current data suggest that vulnerable individuals with low D2/D3 receptors may be vulnerable to lower social status and social supports, and these social factors have previously been suggested as contributors to the risk for alcohol and substance use.

These findings are particularly exciting because they put human neurobiology into a social context, and we humans are fundamentally social creatures. It is in these social contexts that the biological effects on behavior obtain their real meaning.”

Stanford Study: Aging Investors Make More Mistakes -It’s not memory loss or senility


Stanford Study: Aging Investors Make More Mistakes -It’s not memory loss or senility that leads to mistakes, but increased “noise” in parts of seniors’ brains, Stanford psychologists say.