WEBVTT - Ep8 "How does your brain decide what to buy?" 0:00:05.519 --> 0:00:08.840 So what's happening in your brain When you stand at 0:00:08.840 --> 0:00:11.720 the ice cream aisle at the store and you stare 0:00:11.800 --> 0:00:14.720 at all the different options. It doesn't look like there's 0:00:14.760 --> 0:00:18.599 a lot going on there, but inside there is a 0:00:18.920 --> 0:00:21.480 war of brain networks. 0:00:20.960 --> 0:00:21.760 That are raging. 0:00:22.280 --> 0:00:25.320 So how does your brain make its decision about what 0:00:25.440 --> 0:00:29.440 it's going to buy? And how is that influenced by price, 0:00:29.600 --> 0:00:33.440 by your emotions, by your group of friends. How do 0:00:33.520 --> 0:00:37.159 you decide whether you'd rather have a chocolate bar in 0:00:37.200 --> 0:00:41.120 the shape of a computer keyboard or a nice candle? 0:00:41.240 --> 0:00:44.080 Was an integrated match tickholder? And what does this have 0:00:44.120 --> 0:00:47.120 to do with Starbucks or Tiger Woods or Burger King. 0:00:49.520 --> 0:00:54.200 Welcome to Inner Cosmos with me David Eagleman. I'm a 0:00:54.240 --> 0:00:58.920 neuroscientist and an author at Stanford University, and in these 0:00:58.960 --> 0:01:02.959 episodes we say fail deeply into our three pound universe 0:01:03.280 --> 0:01:06.559 to understand why and how our lives look the way 0:01:06.560 --> 0:01:17.160 they do. Today's episode is the second part of a 0:01:17.240 --> 0:01:18.360 three part series. 0:01:19.000 --> 0:01:20.399 We're looking at how the. 0:01:20.360 --> 0:01:25.640 Brain is a machine built of networks that live in conflict. 0:01:25.760 --> 0:01:28.800 In the last episode, we saw that your brain is 0:01:28.880 --> 0:01:34.240 a team of rivals. You have different networks with potentially 0:01:34.280 --> 0:01:38.480 opposing opinions, and they all compete to steer the ship 0:01:38.560 --> 0:01:41.720 of state. And today we're going to see how these 0:01:41.959 --> 0:01:46.840 rivaling networks determine how we decide what to buy, like 0:01:46.959 --> 0:01:50.520 which ice cream brand or which car brand, how much 0:01:50.800 --> 0:01:55.160 should something cost? How do you get steered or manipulated 0:01:55.200 --> 0:01:58.400 by emotions? And does it matter if your friends think 0:01:58.640 --> 0:02:01.560 something is cool or lame. We're going to see how 0:02:01.560 --> 0:02:05.680 an understanding of the brain exposes how we make our 0:02:05.800 --> 0:02:09.880 daily decisions. As we found out in the last episode, 0:02:10.240 --> 0:02:13.960 different networks in your brain care about different things, and 0:02:14.040 --> 0:02:18.200 brain scientists all over the world have used imaging technologies 0:02:18.280 --> 0:02:21.240 to see what the brain is up to when we 0:02:21.320 --> 0:02:26.960 are faced with decisions like decisions about which fast food 0:02:27.000 --> 0:02:30.160 restaurant you're going to choose on the block, or which 0:02:30.600 --> 0:02:33.920 shirt to buy, or which internet service provider you're going 0:02:34.000 --> 0:02:36.880 to sign up with. So let's start with the field 0:02:37.160 --> 0:02:41.160 of economics. All of us who studied some economics in 0:02:41.200 --> 0:02:45.639 college learned how humans make decisions, or that's what we 0:02:45.800 --> 0:02:49.120 thought we were learning, But what we were actually learning 0:02:49.320 --> 0:02:55.560 was an idealized version. We learned about Homo economicus, which 0:02:55.600 --> 0:02:59.840 is a rational decision maker, and that decision maker always 0:02:59.840 --> 0:03:06.200 works to maximize gain and minimize loss, and he's objective, 0:03:06.280 --> 0:03:11.440 he's able to delay gratification. His decisions about what to 0:03:11.520 --> 0:03:15.919 buy are unswayed by his emotions. And by the way, 0:03:15.919 --> 0:03:18.880 if you put him in the same situation twice, he'll 0:03:18.919 --> 0:03:24.640 behave consistently. But imagine I offer you two generic courts 0:03:24.680 --> 0:03:27.720 of Rocky Road ice cream, and for one, I'm charging 0:03:27.760 --> 0:03:30.640 you two dollars fifty cents. For the other one, I'm 0:03:30.720 --> 0:03:33.920 charging you three dollars twenty five cents. As far as 0:03:33.960 --> 0:03:36.600 you can tell, it's the same ice cream inside. So 0:03:36.680 --> 0:03:41.760 if you're an economist, if you're homoeconomicist, the choice is easy. 0:03:41.960 --> 0:03:46.880 It's straightforward. But now imagine that I rotate the courts 0:03:46.960 --> 0:03:50.040 so you can see the labels, and one says Ben 0:03:50.080 --> 0:03:53.520 and Jerry's and one says Hoggen Dawes. So which one 0:03:53.520 --> 0:03:53.960 do you take? 0:03:54.040 --> 0:03:59.960 Now, Well, it's not so straightforward for real humans, because 0:04:00.080 --> 0:04:04.960 suddenly there's branding and the emotions that you anticipate from 0:04:05.040 --> 0:04:08.880 eating these and what your friends think of these brands, 0:04:08.920 --> 0:04:12.560 and all your past experience with these brands, and all 0:04:12.600 --> 0:04:15.200 this has led, in the last thirty years or so. 0:04:15.520 --> 0:04:20.080 To a new field called neuroeconomics. It's also known as 0:04:20.160 --> 0:04:23.680 behavioral economics, and it comes down to the fact that 0:04:23.760 --> 0:04:29.400 we have generally misunderstood how humans actually make decisions. So 0:04:29.560 --> 0:04:34.719 psychologists and neuroscientists have been running experiments for decades now 0:04:35.240 --> 0:04:39.839 to get a realistic understanding of the way people actually 0:04:39.920 --> 0:04:43.560 behave rather than the way they're supposed to behave. And 0:04:43.640 --> 0:04:47.120 what has emerged from this field is that real humans 0:04:47.279 --> 0:04:54.800 are irrational. We care about immediate gratification, We ignore consequences. 0:04:55.200 --> 0:04:58.599 Our decisions are massively swayed by our emotions. 0:04:59.080 --> 0:05:00.080 We behave and. 0:05:00.240 --> 0:05:04.480 Consistently not making the same decision each time. We're easily 0:05:04.560 --> 0:05:09.480 confused by calculations about risk. We're always influenced by branding. 0:05:10.080 --> 0:05:12.120 So this is what we're going to talk about today. 0:05:12.560 --> 0:05:15.560 How an understanding of the team of rivals in the 0:05:15.560 --> 0:05:21.279 brain gives a clearer picture of how we behave. As 0:05:21.279 --> 0:05:24.599 we talked about in the previous episode, you are not 0:05:24.960 --> 0:05:29.280 an individual. In other words, you're not a single program 0:05:29.320 --> 0:05:34.360 that's running. Instead, your brain is made of competing pieces 0:05:34.440 --> 0:05:38.800 and parts, a society of mind, and these are always 0:05:38.880 --> 0:05:42.960 battling to control your decisions. The outcome of the battle 0:05:43.360 --> 0:05:46.440 determines what you do in the world. So, for example, 0:05:46.480 --> 0:05:49.240 if I take some warm chocolate chip cookies out of 0:05:49.279 --> 0:05:51.960 the oven and place them in front of you, part 0:05:51.960 --> 0:05:55.159 of your brain says, great, that's a good source of energy. 0:05:55.400 --> 0:05:57.839 Another part of your brain says, don't eat them, you'll 0:05:57.839 --> 0:06:01.480 get fat. Another says, Okay, I'll eat them this time, 0:06:01.480 --> 0:06:03.960 but I promise I'll go to the gym tonight. And 0:06:04.000 --> 0:06:07.040 you can argue with yourself and eventually get mad at 0:06:07.080 --> 0:06:11.280 yourself for your decision. You can curse at yourself, cajole yourself, 0:06:11.839 --> 0:06:13.680 and as we'll see in the next episode, you can 0:06:13.720 --> 0:06:15.520 even make contracts with yourself. 0:06:16.000 --> 0:06:19.479 But who is talking with whom? Here? It's all you, right, 0:06:19.560 --> 0:06:21.080 but it's different parts of you. 0:06:21.839 --> 0:06:27.080 And this is the sense in which humans can be conflicted. Now, 0:06:27.160 --> 0:06:30.400 there are lots of drives that you have, but today 0:06:30.400 --> 0:06:33.040 we're just going to concentrate on three of the main 0:06:33.279 --> 0:06:36.600 networks that have come out of the last couple of 0:06:36.680 --> 0:06:41.240 decades of brain scanning experiments. And these three networks are 0:06:41.279 --> 0:06:45.360 among the biggest drivers of your decision making when you're 0:06:45.360 --> 0:06:48.480 standing in the store. The first network that we're going 0:06:48.520 --> 0:06:52.680 to talk about cares about the price of something. It's 0:06:52.720 --> 0:06:55.120 made of a couple regions that sit on the side 0:06:55.120 --> 0:06:58.640 of your brain in the northern part here above where 0:06:58.680 --> 0:07:04.080 your ears are. The second network cares about the emotional experience, 0:07:04.320 --> 0:07:09.640 or more specifically, the anticipated emotional experience. This is located 0:07:10.040 --> 0:07:12.520 on the part of your brain just above your eyeballs. 0:07:12.600 --> 0:07:15.280 This is called the orbitofrontal cortex. 0:07:14.840 --> 0:07:18.000 Because it's just above the orbits of the eye and 0:07:18.080 --> 0:07:21.040 the frontal lobe. And this network cares about things like 0:07:21.160 --> 0:07:23.960 what will these chips taste like compared to these Will 0:07:24.000 --> 0:07:25.480 they be delicious or gross? 0:07:25.560 --> 0:07:29.720 Will this make me happy? Regretful? And the third network. 0:07:29.480 --> 0:07:34.320 Responds to social context, as in do my friends think 0:07:34.400 --> 0:07:37.400 this is cool or lame? And these regions right along 0:07:37.440 --> 0:07:40.800 the midline of your brain between the two hemispheres near 0:07:40.840 --> 0:07:44.880 the top. So I'm going to tell you this story 0:07:45.000 --> 0:07:49.800 in three acts, one about each of these networks. So 0:07:49.920 --> 0:07:53.400 let's start with the first, which is about how much 0:07:53.480 --> 0:07:57.920 you think something is worth. A great book that summarizes 0:07:58.000 --> 0:08:01.320 the psychology of this is predict to Be Irrational by 0:08:01.400 --> 0:08:04.960 my colleague Dan Arieli, and I'll use some examples from that. 0:08:05.720 --> 0:08:08.040 So let's say you're in the market for a pair 0:08:08.080 --> 0:08:12.360 of Bluetooth headphones and you find it at a local 0:08:12.440 --> 0:08:15.760 store and they're charging twenty nine dollars, so you think great. 0:08:16.320 --> 0:08:19.000 So right when you're about to buy it, I ring 0:08:19.040 --> 0:08:21.840 you up on your phone and I say, hey, I'm 0:08:21.880 --> 0:08:24.480 two blocks away and I just found that headset you've 0:08:24.480 --> 0:08:28.880 been looking for for nineteen dollars, so it's ten dollars cheaper. 0:08:29.240 --> 0:08:32.280 The question is will you walk over to where I 0:08:32.360 --> 0:08:35.440 am to buy the nineteen dollar headset instead of the 0:08:35.600 --> 0:08:39.680 completely overpriced twenty nine dollars. Now, let's say you're in 0:08:39.720 --> 0:08:43.320 the market for a new cell phone and you find 0:08:43.360 --> 0:08:45.800 the one that you want at this store and it's 0:08:45.880 --> 0:08:49.679 for five hundred and sixty seven dollars, and right when 0:08:49.679 --> 0:08:52.840 you're about to purchase it, I call you and I say, hey, 0:08:52.880 --> 0:08:55.360 I'm two blocks away and I found that phone you're 0:08:55.360 --> 0:08:59.559 looking for for five hundred and fifty seven dollars, ten 0:08:59.600 --> 0:09:03.160 dollars cheaper. The question is are you going to walk 0:09:03.360 --> 0:09:06.400 all the way over two blocks to save ten dollars 0:09:06.520 --> 0:09:09.400 five hundred sixty seven dollars versus five hundred and fifty 0:09:09.400 --> 0:09:12.559 seven dollars. Now, the thing to notice is that these 0:09:12.559 --> 0:09:16.800 two scenarios are exactly the same. I'm asking is ten 0:09:16.880 --> 0:09:20.839 dollars worth the walk, or isn't it. It's the same 0:09:20.920 --> 0:09:24.959 ten dollars either way. But in the first case, most 0:09:24.960 --> 0:09:28.080 people will do it to pay nineteen instead of twenty nine. 0:09:28.120 --> 0:09:31.120 And in the second case, almost nobody's gonna make that 0:09:31.240 --> 0:09:34.040 walk two blocks just to pay five point fifty seven 0:09:34.040 --> 0:09:37.080 instead of five to sixty seven. And this illustrates an 0:09:37.080 --> 0:09:40.840 important point, which is that nothing is judged by itself. 0:09:40.920 --> 0:09:47.560 Everything is judged in context. You are not homo economicus. Okay, 0:09:47.600 --> 0:09:49.880 Now I'm gonna make you an offer. You can have 0:09:49.960 --> 0:09:52.679 one of two things. I'm either gonna give you a 0:09:53.120 --> 0:09:58.240 chocolate bar shaped like a computer keyboard or a candle 0:09:58.320 --> 0:10:01.199 with a little drawer built into it that holds magticks. 0:10:01.679 --> 0:10:04.000 So which one are you going to take? This is 0:10:04.040 --> 0:10:08.040 a difficult decision, right because how do you translate these 0:10:08.080 --> 0:10:11.640 into a common currency so you know which one has 0:10:11.840 --> 0:10:15.000 more value to you. The reason this is a challenge 0:10:15.040 --> 0:10:19.720 is because everything has to be converted into a common 0:10:19.760 --> 0:10:23.280 currency to make a comparison, and this has to happen 0:10:23.640 --> 0:10:27.199 at the level of neural activity, and that's tough when 0:10:27.240 --> 0:10:30.199 you have such different items. This is the same if 0:10:30.240 --> 0:10:33.320 I give you some other comparison like I'll give you 0:10:33.679 --> 0:10:38.840 three apples, or a case for your sunglasses that shaped 0:10:38.840 --> 0:10:41.560 like a hot dog? How do you convert that into 0:10:41.600 --> 0:10:45.360 a common currency to make a direct comparison. So what 0:10:45.400 --> 0:10:49.520 the brain is always looking for is context. It can't 0:10:49.559 --> 0:10:53.200 make a decision about the value of something unless it 0:10:53.240 --> 0:10:56.839 can do a direct head to head comparison. And this 0:10:56.920 --> 0:11:00.440 ends up being an important clue for people who are 0:11:00.440 --> 0:11:03.240 trying to sell you something because none of us know 0:11:03.320 --> 0:11:07.360 how to price something, so we need to be told. 0:11:07.800 --> 0:11:11.640 So here's an example. This happened with Williams Sonoma some 0:11:12.320 --> 0:11:16.760 years ago. They introduced a home bread bakery. It's like 0:11:16.800 --> 0:11:19.800 a large toast drub in that makes a loaf of 0:11:19.840 --> 0:11:22.040 bread for you. And they put a price tag on 0:11:22.120 --> 0:11:25.120 it around two hundred and seventy five dollars and it 0:11:25.160 --> 0:11:29.559 was a perfectly good product, but sales wise, it failed completely. 0:11:29.920 --> 0:11:31.760 No one was buying it. Why. 0:11:31.880 --> 0:11:34.760 It's because people saw it on the shelf and they thought, 0:11:35.120 --> 0:11:36.840 what is a home bread bakery anyway? 0:11:36.920 --> 0:11:38.640 Is this a good one? Do I need it? 0:11:39.160 --> 0:11:42.720 So Williams Sonoma took on a research firm who advised 0:11:42.760 --> 0:11:46.640 them to get a hold of a second homebread bakery 0:11:46.679 --> 0:11:49.960 a slightly bigger one that was more expensive and put 0:11:50.000 --> 0:11:51.559 it on the shelves next to. 0:11:51.520 --> 0:11:55.080 The first one. So they did that, and you know what, 0:11:55.160 --> 0:11:59.000 the first bread bakery started selling. Why. 0:11:59.080 --> 0:12:01.480 It's because people did have to make a decision in 0:12:01.559 --> 0:12:05.400 a vacuum. Now, now they could think, okay, well, I 0:12:05.440 --> 0:12:08.600 don't know much about home breadmakers, but this one seems 0:12:08.640 --> 0:12:11.960 to take up less counter space and it's less expensive, 0:12:12.040 --> 0:12:14.080 so that seems like it's the right choice. 0:12:14.559 --> 0:12:17.480 So the customer's brains were given something that they. 0:12:17.320 --> 0:12:21.640 Could compare and that allowed them to secure a decision. 0:12:22.400 --> 0:12:24.520 And this trick of giving context, by the way, is 0:12:24.559 --> 0:12:27.360 an old trick in real estate. So let's say you're 0:12:27.720 --> 0:12:31.200 an agent and you're trying to sell someone a medium 0:12:31.240 --> 0:12:32.440 sized traditional home. 0:12:32.800 --> 0:12:34.439 But the prospective buyers. 0:12:34.040 --> 0:12:38.280 Are torn between that one and some modern home, and 0:12:38.320 --> 0:12:42.080 they're stuck because these two homes are as different as 0:12:42.160 --> 0:12:45.480 the chocolate keyboard and the candlestick. So what do you 0:12:45.640 --> 0:12:48.920 do as the real estate agent to get them unstuck. 0:12:49.280 --> 0:12:52.000 What you do is you show them another mid sized 0:12:52.040 --> 0:12:55.440 traditional home, one that's a little bit worse. Maybe the 0:12:55.520 --> 0:12:58.760 kitchen is outdated, or it's covered in wood paneling. So 0:12:59.360 --> 0:13:02.760 This is known is the decoy effect, because you don't 0:13:02.800 --> 0:13:05.320 expect them to buy this other home you've just shown them. 0:13:05.679 --> 0:13:09.320 But what you're doing is you're giving their valuation systems 0:13:09.440 --> 0:13:13.640 something it can understand. The brain can now compare the 0:13:13.720 --> 0:13:17.240 slightly worse traditional home against the slightly better traditional home, 0:13:17.400 --> 0:13:19.200 the one where the kitchen doesn't need an update. 0:13:19.760 --> 0:13:22.600 So they see this in context. 0:13:22.120 --> 0:13:25.560 Now and it allows them to lock down a decision. 0:13:30.000 --> 0:13:33.959 In general, everything in your brain is priced by comparison 0:13:34.360 --> 0:13:36.640 to other things that are like it, and this is 0:13:36.679 --> 0:13:41.600 because the brain stores its knowledge by association what is 0:13:41.640 --> 0:13:44.439 related to what and how. So you're not going to 0:13:44.520 --> 0:13:47.440 pay twenty five dollars for a bag of chips because 0:13:47.480 --> 0:13:50.440 you have lots of experience with bags of chips and 0:13:50.440 --> 0:13:54.120 they're not supposed to cost that much. But interestingly, there 0:13:54.240 --> 0:13:58.080 is a way that companies can change where an item 0:13:58.200 --> 0:14:02.679 sits in your network of associations. So, for example, some 0:14:02.720 --> 0:14:04.760 of you may remember a time where you could drive 0:14:05.000 --> 0:14:07.480 anywhere the na should and get a cup of coffee 0:14:07.520 --> 0:14:11.480 for fifty cents. But when Starbucks launched, they didn't want 0:14:11.520 --> 0:14:14.560 to sell their coffee for fifty cents, so they built 0:14:14.600 --> 0:14:20.080 Starbucks to feel like a continental European coffee house, and 0:14:20.160 --> 0:14:24.240 they had the place filled with the smell of roasted beans, 0:14:24.280 --> 0:14:28.760 and they sold coffee presses and piscatti and croissants, and 0:14:28.960 --> 0:14:34.160 they were creating a different experience, so different that we 0:14:34.200 --> 0:14:38.880 wouldn't use the prices of the diners as an anchor 0:14:38.960 --> 0:14:42.160 anymore for the price of coffee. So yeah, they even 0:14:42.400 --> 0:14:45.920 changed the sizes they sold, so small, medium, and large 0:14:45.960 --> 0:14:50.240 became tall, grande, and venti. And this made it so 0:14:50.280 --> 0:14:54.479 that in your network of associations, you didn't link Starbucks 0:14:54.560 --> 0:14:59.680 coffee with diner coffee, but instead with something different and fancier, 0:15:00.160 --> 0:15:04.920 and therefore your valuation of the cup of coffee doesn't 0:15:04.960 --> 0:15:09.080 feel off. So I was in Seattle a while ago, 0:15:09.120 --> 0:15:12.280 and I saw a McDonald's billboard that was taking a 0:15:12.320 --> 0:15:16.240 shot at Starbucks. The sign said four dollars for a 0:15:16.320 --> 0:15:19.760 coffee is done. And what struck me as funny is 0:15:19.800 --> 0:15:24.760 that homoeconomicists totally gets McDonald's message supply and demand and 0:15:24.760 --> 0:15:28.600 so on, but real humans simply don't care. We get 0:15:28.640 --> 0:15:31.920 something out of our experience with Starbucks, and therefore we're 0:15:32.000 --> 0:15:52.680 willing to value a blonde vanilla latte differently. So now 0:15:52.720 --> 0:15:55.800 I've told you how the brain thinks about value, how 0:15:55.880 --> 0:15:58.520 much is something worth? But as I said at the beginning, 0:15:58.560 --> 0:16:02.280 this is only part how the brain makes decisions. There 0:16:02.320 --> 0:16:06.440 are other competing areas involved, and we turn to the 0:16:06.560 --> 0:16:12.160 second act now, which is about emotions. Economists used to 0:16:12.160 --> 0:16:15.480 think that all decision making in humans was a rational 0:16:15.640 --> 0:16:19.600 process ua costs and benefits, and that tips your decision. 0:16:20.040 --> 0:16:23.680 But recently the importance of emotions has come into the 0:16:23.800 --> 0:16:29.120 spotlight because emotions are a critical part of the language 0:16:29.160 --> 0:16:33.640 of the unconscious. It's not all about logic irrationality. We're 0:16:33.640 --> 0:16:38.480 not just information processing devices. Our lives are richly painted 0:16:38.520 --> 0:16:43.400 by emotion, and these influence decision making. So one basic 0:16:43.440 --> 0:16:48.440 example is that you will make harsher moral judgments when 0:16:48.440 --> 0:16:51.920 you're in a room that smells bad. This shows the 0:16:52.040 --> 0:16:56.840 role of emotions like discuss in decision making about things 0:16:56.920 --> 0:17:00.560 that you might think are higher level concepts. Okay, now 0:17:00.600 --> 0:17:03.880 I'll give you another example, one that's been making the 0:17:04.000 --> 0:17:07.840 rounds in philosophy for a little while. In part one 0:17:07.880 --> 0:17:11.040 of this series, I mentioned the trolley dilemma. 0:17:11.440 --> 0:17:12.560 Here's a quick reminder. 0:17:12.880 --> 0:17:16.240 A trolley is barreling down the train tracks out of control. 0:17:16.680 --> 0:17:20.280 Five workers are making repairs way down the track, and you, 0:17:20.480 --> 0:17:23.639 a bystander, quickly realize that they're all going to be 0:17:23.760 --> 0:17:27.359 killed by the trolley. But you also notice there's a 0:17:27.480 --> 0:17:30.800 lever nearby that you can throw, and that will divert 0:17:30.880 --> 0:17:33.959 the trolley down a different track where only a single 0:17:34.000 --> 0:17:35.080 worker will be killed. 0:17:35.640 --> 0:17:36.440 So what do you do? 0:17:36.880 --> 0:17:40.200 If you're like most people, you pull the lever, because 0:17:40.200 --> 0:17:43.240 it's better to have one person killed than five. Now, 0:17:43.280 --> 0:17:46.400 in the second scenario of the trolley dilemma, the same 0:17:46.440 --> 0:17:49.600 trolley's barreling down the tracks. The same five workers are 0:17:49.640 --> 0:17:53.840 in harm's way, But this time you are a bystander 0:17:53.880 --> 0:17:57.080 on a footbridge that goes over the tracks, and you 0:17:57.200 --> 0:18:00.000 notice that there's a large man standing on the footbridge, 0:18:00.560 --> 0:18:02.840 and you realize that if you were to push him 0:18:02.920 --> 0:18:06.880 off the bridge, his bulk would be sufficient to stop 0:18:06.960 --> 0:18:09.040 the train and save the five workers. 0:18:09.680 --> 0:18:14.800 Do you push him off? Now? 0:18:14.840 --> 0:18:18.040 Most people here just won't do it. Even now, the 0:18:18.200 --> 0:18:21.600 math is exactly the same. You're trading one life for 0:18:21.720 --> 0:18:25.880 five lives. The only difference is the issue of touching 0:18:25.920 --> 0:18:28.880 the person with your bare hands or not. And as 0:18:28.920 --> 0:18:31.800 I mentioned last time, when my colleagues did brain scanning. 0:18:31.840 --> 0:18:34.680 They found that in the first case, the networks that 0:18:34.840 --> 0:18:39.920 come online are just those involved with doing math problems essentially. 0:18:40.200 --> 0:18:43.840 But in the second case, you've got these emotional networks 0:18:43.880 --> 0:18:47.320 coming online too, these networks in the orbit of frontal cortex, 0:18:47.800 --> 0:18:54.520 and that entirely changes your decision. So the networks involved 0:18:54.560 --> 0:18:59.080 in emotion are very powerful drivers of decision making, and 0:18:59.119 --> 0:19:02.720 this plays a bit role in how we select products, 0:19:02.720 --> 0:19:06.920 how we make economic decisions. So when companies are interested 0:19:06.960 --> 0:19:10.639 in plugging into these networks, they don't use terms like 0:19:11.359 --> 0:19:14.959 we have an integrated approach or we give a comprehensive solution. 0:19:15.359 --> 0:19:19.720 Those things don't talk to these orbital frontal networks at all. Instead, 0:19:20.400 --> 0:19:24.440 companies say things like don't hate me because I'm beautiful, 0:19:25.240 --> 0:19:29.240 or are you man enough to eat this burger? And 0:19:29.280 --> 0:19:32.840 the idea is to plug right into the emotional networks 0:19:32.920 --> 0:19:36.800 to steer your decision making. And it doesn't have to 0:19:36.840 --> 0:19:41.120 be big and explicit, but also includes everything you've ever. 0:19:40.960 --> 0:19:42.320 Seen in any ad. 0:19:42.880 --> 0:19:48.679 Beautiful people loving the product being advertised, They smile beautifully 0:19:48.720 --> 0:19:52.440 when they touch or look at the product. If it's cereal, 0:19:52.520 --> 0:19:55.199 it's a family that's so happy and attractive and they 0:19:55.200 --> 0:19:58.560 don't have any problems if it's for an adult audience. 0:19:58.680 --> 0:20:01.920 The stars of the commercial are smiling at each other. 0:20:02.119 --> 0:20:05.320 The camera lingers for just a moment longer to make 0:20:05.359 --> 0:20:08.280 it clear that this is all a prelude to something 0:20:08.320 --> 0:20:12.560 that's inevitably going to happen between them. In other words, 0:20:12.600 --> 0:20:16.720 the appeal isn't to these networks that are concerned with valuation, 0:20:17.200 --> 0:20:21.920 but instead the networks that drive primitive emotions. 0:20:22.000 --> 0:20:24.199 These have tremendous. 0:20:23.440 --> 0:20:32.080 Power in the neural parliament that drives your decisions. So 0:20:32.200 --> 0:20:36.520 now I've mentioned the brain networks involved in valuation and 0:20:36.560 --> 0:20:40.119 those involved in emotion, and there's one more which brings 0:20:40.160 --> 0:20:44.200 us to Act three. Traditionally, we study the brain by 0:20:44.280 --> 0:20:47.520 looking at different regions and mapping what they're involved in, 0:20:47.680 --> 0:20:50.040 like this is the region for vision, and over here 0:20:50.160 --> 0:20:52.760 is where hearing takes place, and this area is involved 0:20:52.760 --> 0:20:55.879 in touch and so on. But an enormous amount of 0:20:55.920 --> 0:21:00.439 the circuitry of the brain has to do with other people, 0:21:00.720 --> 0:21:04.880 understanding other people. We have an enormous amount of circuitry 0:21:05.280 --> 0:21:11.760 devoted towards issues of trust or integrity, or the reputation 0:21:11.920 --> 0:21:14.879 of other people in our tribe or in modern life, 0:21:14.880 --> 0:21:17.080 it's others we meet all over the world, as well 0:21:17.119 --> 0:21:21.639 as celebrities we've never even met. Bizarrely, so much of 0:21:21.680 --> 0:21:26.080 our circuitry is devoted to social concerns. I can even 0:21:26.119 --> 0:21:30.000 ask you, hey, does that person in your thousand contacts 0:21:30.040 --> 0:21:33.840 that you know know this other person? And you'll pretty 0:21:33.880 --> 0:21:36.879 much know immediately whether they know each other? And how 0:21:37.440 --> 0:21:40.159 think about that? It's like a thousand by a thousand 0:21:40.280 --> 0:21:43.800 matrix of data that's being stored there that you can 0:21:43.880 --> 0:21:46.879 just call up in an instant And these sorts of 0:21:47.640 --> 0:21:52.440 considerations about how much our brains care about other people 0:21:53.119 --> 0:21:58.760 has led to a new subfield called social neuroscience. Now, 0:21:58.880 --> 0:22:02.040 something quite amazing, it's surprising that I studied in my 0:22:02.240 --> 0:22:07.240 lab with brain imaging, is that to the brain, companies 0:22:07.880 --> 0:22:11.520 are just like people. We evolved in small groups and 0:22:11.560 --> 0:22:15.280 developed this very rich social circuitry to understand each other 0:22:15.320 --> 0:22:18.639 and to understand issues of trust and integrity and reputation 0:22:19.240 --> 0:22:22.800 of every person in the group. But companies came along 0:22:23.040 --> 0:22:26.959 just in the last second of our evolutionary history, and 0:22:27.080 --> 0:22:31.480 obviously Mother Nature hasn't had time to rewrite the brain 0:22:31.760 --> 0:22:35.920 to understand companies, so we use exactly the same circuitry, 0:22:36.040 --> 0:22:39.800 as we do when we think about other people. So 0:22:39.840 --> 0:22:42.520 we study this in my lab by having people read 0:22:42.600 --> 0:22:46.440 a vignette about a person that does something something either 0:22:46.640 --> 0:22:49.960 good or bad or suspicious, and we measure how different 0:22:50.080 --> 0:22:54.479 brain regions respond to a person behaving this way. And 0:22:54.520 --> 0:22:58.199 then we show these same vignettes to other people, but 0:22:58.280 --> 0:23:01.119 we swapped out the name of the person with the 0:23:01.200 --> 0:23:04.840 name of a company, and the brain regions that respond 0:23:04.840 --> 0:23:10.359 are exactly the same. Evolutionarily, companies are something new and 0:23:10.400 --> 0:23:14.359 we haven't evolved new circuitry to understand them. So we 0:23:14.560 --> 0:23:17.680 understand a company exactly the same way with the same 0:23:17.680 --> 0:23:21.480 circuitry that we use to understand other people. Is that 0:23:21.640 --> 0:23:26.000 company trustworthy? Does the company have integrity? What is that 0:23:26.080 --> 0:23:33.840 company's social reputation? And you see this on Facebook where 0:23:33.840 --> 0:23:38.240 people are friends with people and they're friends with companies. 0:23:39.119 --> 0:23:41.520 And by the way, in the legal system, there's a 0:23:42.000 --> 0:23:46.879 legal fiction in which we treat corporations like individuals. So 0:23:46.920 --> 0:23:49.400 the corporation can be guilty of a crime, can be 0:23:49.640 --> 0:23:52.320 liable of a crime, and so on. In fact, the 0:23:52.359 --> 0:23:58.359 word corporation means body. Now it might seem hard to 0:23:58.440 --> 0:24:03.560 believe that companies and social reputation are tied so closely. 0:24:04.200 --> 0:24:07.800 But let's take a typical example. Look at what happened 0:24:07.840 --> 0:24:13.200 when one major company tied their reputation to a clean cut, 0:24:13.280 --> 0:24:16.439 admirable young man and they got all the benefits from that. 0:24:16.960 --> 0:24:19.760 I'm talking about Nike, who tied themselves to Tiger Woods. 0:24:19.840 --> 0:24:24.480 He was in their advertising and his superstar power directly 0:24:24.560 --> 0:24:27.840 lifted their economics because he was awesome, and so people 0:24:27.880 --> 0:24:31.439 felt like cool, Nike is awesome and same way. But 0:24:31.560 --> 0:24:34.520 then one day in two thousand and nine, the news 0:24:34.600 --> 0:24:37.600 hit Twitter that he was cheating on his wife. Now 0:24:37.680 --> 0:24:39.600 you can go back and look at a chart of 0:24:39.720 --> 0:24:44.240 Nike stock that day. The news of his infidelity hit 0:24:44.240 --> 0:24:47.560 Twitter at eleven forty am, and you can see the 0:24:47.720 --> 0:24:52.119 immediate effect on the Nike stock price, which continued to 0:24:52.280 --> 0:24:55.639 drop precipitously for the rest of the day and for 0:24:55.680 --> 0:24:56.880 the next six months. 0:24:57.440 --> 0:24:58.520 Even though Tiger. 0:24:58.200 --> 0:25:02.040 Woods has nothing to do with the manufacturing or distribution 0:25:02.240 --> 0:25:06.760 or the quality of the shoes, his infidelity soiled the 0:25:06.760 --> 0:25:10.520 company's reputation in the social brain. If he didn't have 0:25:10.560 --> 0:25:15.480 integrity at that moment, then something becomes wrong with the shoes. Now, 0:25:15.480 --> 0:25:16.960 what I want to point out is this is not 0:25:17.000 --> 0:25:21.400 just an economic phenomenon, it's a social phenomenon, and fundamentally, 0:25:21.680 --> 0:25:28.639 it's a neuroscientific phenomenon. These social circuits evolved when we 0:25:28.720 --> 0:25:32.200 operated in small tribes. They weren't really built to operate 0:25:32.240 --> 0:25:36.240 at the level of multinational companies, and as a result, 0:25:36.800 --> 0:25:40.159