Determinants of Propranolol's Selective Effect on Loss Aversion

Abstract

Research on emotion and decision making has suggested that arousal mediates risky decisions, but several distinct and often confounded processes drive such choices. We used econometric modeling to separate and quantify the unique contributions of loss aversion, risk attitudes, and choice consistency to risky decision making. We administered the beta-blocker propranolol in a double-blind, placebo-controlled within-subjects study, targeting the neurohormonal basis of physiological arousal. Matching our intervention's pharmacological specificity with a quantitative model delineating decision-making components allowed us to identify the causal relationships between arousal and decision making that do and do not exist. Propranolol selectively reduced loss aversion in a baseline- and dose-dependent manner (i.e., as a function of initial loss aversion and body mass index), and did not affect risk attitudes or choice consistency. These findings provide evidence for a specific, modulatory, and causal relationship between precise components of emotion and risky decision making.

Keywords: decision making; emotion; loss aversion; open data; propranolol; risk attitudes.

Fig. 1

Task structure. Days were identical except for the order in which propranolol and placebo were received. Participants ate a standard meal to aid propranolol absorption. Blood pressure and heart rate were assessed four times each day.

Fig. 2

The effect of propranolol on loss aversion as identified by (A) regression coefficients, and (b) separated into the average effect of propranolol overall, and in the low- and high-BMI groups separately. Error bars are standard error of the mean, asterisks indicate one-sample t-tests against zero in all cases except the two-sample t-test examining differences between BMI groups (* = p < 0.05, *** = p < 0.001).