How Dr. Michael Platt Decodes Decision-Making

Feb 18, 2025

Making Better Decisions Through Neuroscience

The neuroscience of decision-making reveals a complex interplay between our conscious thoughts and unconscious biological drivers. Our choices, from the mundane to the life-altering, are shaped by factors operating beneath our awareness.

Consider the process of selecting a watch or choosing a life partner. While we might believe we’re making purely rational decisions, our brain’s valuation systems are constantly processing hormonal signals, social hierarchies, and environmental cues that influence our judgments.

These neural mechanisms evolved to help us navigate social relationships and make rapid assessments of value. When we interact with others, we unconsciously evaluate their hormone levels, which affects our perception of their attractiveness, trustworthiness, and compatibility. This biological dance occurs whether we’re in a business meeting or on a first date.

Power dynamics and hierarchical structures within organizations significantly impact our decision-making processes. The brain responds differently to information depending on our perceived status and the status of those around us. This evolutionary adaptation continues to influence modern workplace dynamics and social interactions.

Understanding these underlying mechanisms can help us make more informed decisions. By recognizing the role of hormones and social contexts in our judgment, we can better account for these biological influences when making important choices.

The brain’s valuation systems are particularly susceptible to contextual factors. The same object or person might be perceived differently depending on the surrounding environment, other available options, or our current physiological state. This explains why our preferences can seem inconsistent or why we sometimes make choices that later puzzle us.

According to Platt’s research, successful decision-making requires balancing our intuitive biological responses with conscious analytical thinking. While we cannot completely override our evolutionary programming, awareness of these mechanisms allows us to better calibrate our choices.

Our neural circuitry for decision-making evolved in a world very different from today’s complex social environments. Yet these ancient systems continue to guide our choices in modern contexts, from corporate boardrooms to dating apps.

These insights from neuroscience suggest that improving our decision-making isn’t about suppressing our biological responses, but rather about understanding and accounting for them. This awareness can lead to more thoughtful choices in both personal and professional contexts.

Decision Making Mechanics and Time Pressure

Value-based decision making follows a consistent neural process, regardless of whether we’re choosing between a donut and an apple or contemplating marriage. The brain evaluates available options by weighing current evidence against stored information from past experiences, computing the expected value of different choices.

This computational process isn’t binary or deterministic – it operates on a statistical “soft max” function that includes inherent noise. When we make a choice, our brain forecasts the expected outcome and compares the actual result against this prediction. This feedback loop allows us to update our decision-making framework, theoretically improving future choices.

A fundamental principle in decision making is the speed-accuracy trade-off. The faster we make decisions, the more likely we are to make mistakes. This occurs because rapid decisions don’t allow sufficient time to accumulate evidence, leaving us more susceptible to noise in our neural processing. Sleep deprivation can exacerbate this effect, further degrading our decision-making capabilities.

For important decisions, we must deliberately choose between speed and accuracy. When accuracy is paramount, we need to consciously slow down and gather more information. Simple strategies like controlled breathing or maintaining perspective-giving mantras can help reduce arousal levels, which act like a volume knob for both signal and noise in our brain’s input processing.

Increased arousal can lead to both false positives and false negatives in our decision-making process. When we’re highly aroused, we might interpret noise as valid evidence, leading to poor choices. This is particularly relevant in today’s fast-paced digital environment, where the ability to publish or post immediately often conflicts with the need for careful consideration and verification.

The mantra “go as fast as you carefully can” provides a useful framework for balancing speed and accuracy. While we often believe we don’t have time to slow down and consider decisions carefully, in most cases, we do have more time than we think. However, this must be balanced against the reality that some opportunities have genuine time constraints – we are, after all, biological beings subject to aging and finite windows of opportunity.

Decision Making Under Physical and Mental Fatigue

Decision-making is a complex interplay between our physical state, mental fatigue, and the context in which choices are made. The stakes of our decisions—whether financial, relational, or professional—create varying levels of pressure that influence our judgment.

Recent research with Penn’s wrestling team revealed fascinating insights about decision-making under physical and mental strain. The study showed that as wrestlers became increasingly fatigued, their decision-making significantly deteriorated, particularly in the third period of matches. When exhausted, they prioritized speed over accuracy, making hasty choices without proper deliberation.

This led to an interesting solution: offloading critical decisions to a fresh mind—the coach—during periods of extreme fatigue. This strategy has broader implications beyond sports. In business settings, when team members are exhausted, delegating decision-making authority to someone with a clearer mental state could prove beneficial.

Laboratory studies of decision-making, while valuable, often fail to capture the full complexity of real-world choices. A student gambling for $10 in a controlled environment faces vastly different pressures than someone making decisions about fertility, relationships, or financial security.

The challenge lies in bridging this gap between controlled research and real-world application. While we understand individual factors affecting decision-making, we’re still learning how these elements interact in complex, natural environments. The key is studying decision-making—both individual and collective—in authentic contexts where multiple priorities and pressures coexist.

This understanding becomes particularly crucial in activities that combine physical and mental demands, such as combat sports or strategic physical competitions. Activities like fencing and Brazilian jiu-jitsu exemplify this intersection, where success depends on managing both physical exertion and strategic thinking simultaneously.

Testosterone Hormones and Decision Making

The interplay between hormones and decision-making reveals fascinating patterns about human behavior, particularly in high-stakes environments. When we examine the relationship between testosterone and decision-making, we find that it acts as an amplifier of existing behavioral tendencies rather than a personality transformer.

Research has consistently shown that testosterone doesn’t simply turn people aggressive or kind; instead, it intensifies their natural predispositions. This hormone makes effort feel rewarding, but the type of effort that feels good is deeply personal and rooted in complex individual characteristics that can’t be reduced to simple molecular explanations.

In the financial sector, this hormonal influence becomes particularly evident. Studies published in the Proceedings of the National Academy of Sciences have demonstrated a clear correlation between testosterone levels and aggressive decision-making among traders. Higher testosterone levels correspond with increased risk-taking behavior and more impulsive trading decisions.

The rise of testosterone replacement therapy (TRT) in professional settings adds another layer to this discussion. Platt notes a concerning trend where traders experiencing age-related testosterone decline turn to synthetic hormones to maintain their “edge.” This practice raises questions about market stability when multiple decision-makers are potentially operating under artificially elevated hormone levels.

However, Huberman emphasizes that testosterone is just one piece of a larger puzzle. While exogenous androgens can provide advantages in terms of recovery and performance, especially when sleep is compromised, quality decision-making relies on multiple factors. Good sleep, proper nutrition, and overall wellness form a committee of influences that shape our choices, rather than allowing a single hormone to dictate our decisions.

The relationship between oxytocin and testosterone further complicates this picture. While testosterone can heighten hierarchical tendencies, oxytocin – activated through touch and social affiliation – tends to flatten these hierarchies. This creates a complex interplay where our hormonal state influences not just our individual choices, but also our social dynamics and organizational structures.

These insights have crucial implications for both personal development and organizational design. Understanding how hormones influence decision-making can help us create better systems and processes that account for these biological factors while maintaining balanced and rational choice-making environments.

How Brands Use Celebrity Status to Influence Us

Status, celebrity, and sex have a peculiar hold on our decision-making process – one that runs far deeper than we might imagine. Recent research with primates reveals just how hardwired these influences are in our neural circuitry.

Consider how brands leverage celebrity endorsements. When George Clooney promotes Nespresso or Jennifer Aniston advocates for Smart Water, our rational minds might dismiss these associations as meaningless. After all, what special knowledge do these celebrities possess about coffee or water? Yet these marketing strategies persist because they tap into something fundamental about our brain’s architecture.

Platt’s fascinating experiment with monkeys demonstrates this principle in action. By simply pairing brand logos with images of high-status or attractive monkeys, researchers found that the subjects developed strong preferences for brands associated with “celebrity” monkeys – even though the actual reward (a banana pellet) remained identical regardless of their choice.

This phenomenon stems from how our brains process and value social information. The neural circuits responsible for attention and reward are specifically tuned to respond to indicators of status and attractiveness. When we encounter these signals – whether in monkeys or humans – they trigger automatic responses that influence our perceptions and choices.

The power of association runs so deep that we often merge unrelated concepts in our cognitive space merely because they appear together. This explains why viewers frequently speculate about romantic relationships between co-hosts who simply share screen time, or why we unconsciously attribute positive qualities to products endorsed by attractive celebrities.

These findings challenge our assumptions about rational decision-making. While we might believe our preferences are based on careful evaluation of product qualities, our brains are simultaneously processing a complex web of social signals and status markers that shape our choices in ways we don’t consciously recognize.

What’s particularly striking is how universal these mechanisms appear to be across primates. The same neural architecture that drives a monkey to prefer “celebrity-endorsed” Doritos also influences humans to reach for products promoted by high-status individuals. As Platt notes, “There’s a little monkey in all of us.”

This built-in susceptibility to status and attractiveness signals raises important questions about hierarchy and social comparison. While some might view this through the lens of competition – where one person’s rise necessitates another’s fall – we can alternatively frame it as inspiration for personal growth and achievement.

Social Influence on Investment Behavior

Social influence shapes our investment decisions far more than we’d like to admit. The evidence is clear: from meme stocks to cryptocurrency, our financial choices are deeply intertwined with what others around us are doing.

Consider the research conducted at Wharton Business School. MBA students participated in a simulated stock market game, identical to one developed for monkeys. The findings were remarkable – individuals who were more socially attuned were more likely to get caught in market bubbles and lose everything. Those with lower social sensitivity performed better, staying clear of the herd mentality that often drives market crashes.

The monkey experiments revealed an even more fascinating insight. When trading alone, monkeys made relatively sound decisions. However, introduce another monkey into the equation, and the behavior changed dramatically. They would watch each other’s trades, creating a feedback loop that inevitably led to bubbles and crashes. The larger the portfolio imbalance between monkeys, the more attention they paid to each other’s moves.

Platt’s research exposed the neural mechanisms behind this behavior. The brain circuit responsible for theory of mind – our ability to understand and predict others’ behavior – drives our attention to others’ investment decisions. This same circuit becomes increasingly active when we perceive ourselves falling behind others financially.

Celebrity endorsements compound this effect. Eye-tracking studies show that when people choose unfamiliar products endorsed by celebrities, their pupils don’t dilate as they normally would when making uncertain decisions. This indicates increased confidence and trust, even when that trust may be misplaced.

This phenomenon isn’t new. Even Sir Isaac Newton fell victim to it during the South Sea bubble, famously lamenting that while he could calculate the motion of heavenly bodies, he couldn’t predict the madness of people. He initially sold his positions for a profit, only to buy back in after seeing others continue to profit, ultimately losing his fortune.

The cryptocurrency market exemplifies these dynamics perfectly. When news breaks about major investors or institutions buying into crypto assets, it creates a social pressure cooker. However, as seasoned investors know, such announcements often reflect historical purchases rather than current market activity.

The same patterns emerge in real estate. When influential people start praising a particular neighborhood’s potential, it can create a self-fulfilling prophecy of rising prices. Often, those singing the loudest praises already own property in the area, positioning themselves to profit from the very surge they’re helping to create.

These social influences are hardwired into our decision-making processes. We’ve evolved to learn from others’ experiences – a generally adaptive trait that can backfire in modern financial markets. Understanding these psychological mechanisms doesn’t make us immune to them, but it does allow us to approach investment decisions with greater awareness of our inherent biases.

Read Andrew Huberman

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