Deconstructing risk: Separable encoding of variance and skewness in the brain

Abstract

Risky choice entails a need to appraise all possible outcomes and integrate this information with individual risk preference. Risk is frequently quantified solely by statistical variance of outcomes, but here we provide evidence that individuals’ choice behaviour is sensitive to both dispersion (variance) and asymmetry (skewness) of outcomes. Using a novel behavioural paradigm in humans, we independently manipulated these ‘summary statistics’ while scanning subjects with fMRI. We show that a behavioural sensitivity to variance and skewness is mirrored in neuroanatomically dissociable representations of these quantities, with parietal cortex showing sensitivity to the former and prefrontal cortex and ventral striatum to the latter. Furthermore, integration of these objective risk metrics with subjective risk preference is expressed in a subject-specific coupling between neural activity and choice behaviour in anterior insula. Our findings show that risk is neither monolithic from a behavioural nor neural perspective and its decomposition is evident both in distinct behavioural preferences and in segregated underlying brain representations.

The angular gyrus and visuospatial attention in decision-making under risk

“…Previous neuroimaging studies found that the AG is activated during decision-making (Ernst et al, 2004;Labudda et al, 2008;Vickery and Jiang, 2009) and moreover, showed that hemodynamic responses in this area during the choice process reflect the probability Berns et al, 2008;Studer et al, 2012) and variance (Symmonds et al, 2011) of potential outcomes. The AG is also thought to be a key area for visuospatial attention.…”

Predicting risky choices from brain activity patterns

“…A large network of regions that are sensitive to risk has been identified, including the insula, frontal cortices, striatum, cingulate cortex, thalamus, and parietal lobes (1)(2)(3)(4)(5)(6)(15)(16)(17)(18). However, these studies have left a related question largely unaddressed: When confronted with a decision with a given amount of risk, what key differences in neural activity predict whether the subject will go on to make the risky or safe choice?…”

The Relation of Steroid Hormones and Personality Factors to Financial Performance and Risk-Taking Behavior

“…Furthermore, the results are supported by medical studies showing that variance and skewness are processed by two different brain areas, both of which are known targets of cortisol (Symmonds et al 2011). …”