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Jan B. Engelmann, Manon Mulckhuyse and Chih-Chung Ting

Economic decisions are fundamentally linked to our biology and it is therefore essential to investigate the biological mechanisms underlying economic decision-making. Neuroeconomics applies neuroscientific methods to questions that are relevant for the field of economics, with the goal of providing mechanistic explanations about how neural processes give rise to the cognitive and emotional processes that support economic decision-making. This chapter introduces the methods commonly used in neuroeconomics, using recent experiments to illustrate how neuroscientific techniques can be applied to questions that are important for economics. We provide an overview of neuroimaging and brain stimulation techniques, focusing on functional magnetic resonance imaging (fMRI) and transcranial magnetic stimulation (TMS). Advantages and limitations of neuroscientific techniques are discussed, stressing the importance of converging evidence from multiple methods. Integrating research findings that use the neuroscientific methodologies outlined in this chapter will pave the way for neurobiologically plausible economic theories of human decision-making.