Essays on the neurobiology of economic and financial risk taking

This thesis investigated the influence of neurobiological mechanisms in economic and financial risk taking, and their possible roles in understanding market stability. The evidences about risk preferences, trading behaviours and physiological responses, which were found in our laboratory and field experiments, supported a feedback theory. Our physiological responses under certain circumstances may exaggerate the emotions of exuberance and pessimism during market boom and bust times, reducing our abilities to engage in rational decisions