Encoding of marginal utility across time in the human brain

Abstract

Marginal utility theory prescribes the relationship between the objective property of the magnitude of rewards and their subjective value. Despite its pervasive influence, however, there is remarkably little direct empirical evidence for such a theory of value, let alone of its neurobiological basis. We show that human preferences in an intertemporal choice task are best described by a model that integrates marginally diminishing utility with temporal discounting. Using functional magnetic resonance imaging, we show that activity in the dorsal striatum encodes both the marginal utility of rewards, over and above that which can be described by their magnitude alone, and the discounting associ..