We have a new book chapter published in "Neuroeconomics and the firm" a book edited by Angela Stanton, Mellani Day and Isabell Welpe (browse the book here and download our chapter here).
This is what Nobel Laureate Vernon Smith wrote about the book:
"This volume brings together leading researchers from a variety of fields to investigate the concept of the firm from new perspectives arising from neuroeconomics. The traditional theory of the firm has focused on the strategic, operational and resource management objectives of the firm as an organization. This timely and informative book explores new horizons in the biology of human decision-making and behavior, including uncertainty, entrepreneurship and ethics as it affects the functioning of the organization.
The fascinating chapters cover a wide range of research fields, drawing on both the conscious and the unconscious mind, and how common hormonal cycles in the female and testosterone variations in the male affect each other in the workplace and its affect on the firm as an organization. The topics of entrepreneurship and the recent global financial crisis are discussed from the perspective of hormonal forces and the implications of those forces in the future. It is an enlightening selection of articles that scholars, students, business leaders, and managers will find a valuable read."
Our chapter, co-authored with Frédéric Basso and Laurent Guillou is entitled "Embodied entrepreneurship: A sensory theory of value" and introduces the reader to Frederic's theory. We discuss our sensory theory of value (STV) in the context of entrepreneurship. Our theory originates in Friedrich Hayek’s seminal work that brought together neurophysiology and political economics. Three main elements will be discussed in light of recent developments in economic, cognitive and brain sciences. First, we argue that STV is a theory of mind when applied to the behavior of the entrepreneur on the market. Indeed, as a person the entrepreneur is an innovator. He is therefore imitated by his peers –and by many other actors of the market‐ because of the intentions and beliefs they attribute to him. To analyze this specific process, we refer to Hayek’s views on imitation, more specifically the concepts of “sensory” and “spontaneous” orders. Second, we show that determining market prices, as a cognitive mechanism, provides information on the behavior of the entrepreneur himself since it results from (1) private information that he is the only one to possess, (2) beliefs that other people think he has and (3) implicit knowledge shared by all actors on the market. Finally, we discuss the relevance of considering (and studying) prices as sensory data through recent advances in the fields of motor cognition, social coordination dynamics and neuroeconomics.
- Browse the book here
- List of contributors to the book: D.B. Audretsch, N.A. Baglini, F. Basso, C.D. Beugré, E.S. Blair, M. Day, K.M. Durante, D.E. Gibson, L. Guillou, M.P. Haselhuhn, J.E. Joseph, L.J. Kray, X. Liu, C.C. Locke, J.F. McCarthy, T. Michl, A. Nadler, K.A. Nelson, O. Oullier, H. Pushkarskaya, G. Saad, C.A. Scheraga, R. Smith, M. Smithson, A.A. Stanton, S. Taing, D.T. Wargo, I.M. Welpe, P.J. Zak