Previous research has identified a component of the event-related brain potential (ERP), the feedback-related negativity, that is elicited by feedback stimuli associated with unfavourable outcomes. In the present research we used event-related functional magnetic resonance imaging (fMRI) and electroencephalographic (EEG) recordings to test the common hypothesis that this component is generated in the caudal anterior cingulate cortex. The EEG results indicated that our paradigm, a time estimation task with trial-to-trial performance feedback, elicited a large feedback-related negativity (FRN). Nevertheless, the fMRI results did not reveal any area in the caudal anterior cingulate cortex that was differentially activated by positive and negative performance feedback, casting doubt on the notion that the FRN is generated in this brain region. In contrast, we found a number of brain areas outside the posterior medial frontal cortex that were activated more strongly by positive feedback than by negative feedback. These included areas in the rostral anterior cingulate cortex, posterior cingulate cortex, right superior frontal gyrus, and striatum. An anatomically constrained source model assuming equivalent dipole generators in the rostral anterior cingulate, posterior cingulate, and right superior frontal gyrus produced a simulated scalp distribution that corresponded closely to the observed scalp distribution of the FRN. These results support a new hypothesis regarding the neural generators of the FRN, and have important implications for the use of this component as an electrophysiological index of performance monitoring and reward processing.

Functional neuroimaging research in humans has identified a number of brain areas that are activated by the delivery of primary and secondary reinforcers. The present study investigated how activity in these reward-sensitive regions is modulated by the context in which rewards and punishments are experienced. Fourteen healthy volunteers were scanned during the performance of a simple monetary gambling task that involved a bwinQ condition (in which the possible outcomes were a large monetary gain, a small gain, or no gain of money) and a bloseQ condition (in which the possible outcomes were a large monetary loss, a small loss, or no loss of money). We observed reward-sensitive activity in a number of brain areas previously implicated in reward processing, including the striatum, prefrontal cortex, posterior cingulate, and inferior parietal lobule. Critically, activity in these reward-sensitive areas was highly sensitive to the range of possible outcomes from which an outcome was selected. In particular, these regions were activated to a comparable degree by the best outcomes in each condition-a large gain in the win condition and no loss of money in the lose condition-despite the large difference in the objective value of these outcomes. In addition, some rewardsensitive brain areas showed a binary instead of graded sensitivity to the magnitude of the outcomes from each distribution. These results provide important evidence regarding the way in which the brain scales the motivational value of events by the context in which these events occur. D