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25INTERNATIONAL JOURNAL OF THEORETICAL AND PRACTICAL RESEARCH
DOI 10.5281/zenodo. 5731674
International journal of theoretical and practical research
Scientific Journal
Year: 2021 Issue: 1 Published:
Volume: 1 01.11.2021
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Citation.
Horska, E., Lajdova, Z., Kapsdorferova, Z. (2021). Bioeconomics, neuroeconomics and neuromarketing. new approaches to customers and businesses. SJ
International journal of theoretical and practical research, 1 (1),13-21.
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Doi: https://dx.doi.org/10.5281/zenodo.5730952
DOI 10.5281/zenodo. 57309 52
Horska Elena
PhD in economics, Faculty of Economics and Management, Slovak University of Agriculture in Nitra, Slovakia
Lajdova Zuzana
PhD, Faculty of Economics and Management, Slovak University of Agriculture in Nitra, Slovakia
Kapsdorferova Zuzana
PhD, Faculty of Economics and Management, Slovak University of Agriculture in Nitra, Slovakia
BIOECONOMICS, NEUROECONOMICS AND NEUROMARKETING: NEW APPROACHES TO CUSTOMERS AND BUSINESSES
Abstract: New approaches that integrate several disciplines such as economics, biology, psychology, neuroscience etc. are considered appropriate for providing better explanation of economic events and complex economies of today. Bioeconomics, originated from the synthesis of economics and biology, intends to explain economic events using a biological basis and vice versa and this discipline is important to the protection of environment and life support system. Bio-economic modeling provides the assessment of the impacts of environmental management changes based on evaluation of the costs and benefits linked with environmental resource usage and it
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determines the optimal level of resource extraction to maximize economic profits. Neuroeconomics is a natural extension of bioeconomics focusing on behavioral dispositions and behavioral patterns of evolutionary processes. Neuromarketing crosses traditional boundaries between neuroscience, neuroeconomics and marketing research. The aim of the paper is to provide a theoretical framework for bioeconomics, neuroeconomics and neuromarketing based on the recent empirical studies and describes different techniques used in these new progressive approaches.
Keywords: bioeconomics, decision-making, neuroeconomics, neuromarketing.
Елена Хорская
PhD, Факультет экономики и менеджмента, Словацкий сельскохозяйственный университет в Нитре, Словакия
Зузана Лайдова
PhD, Факультет экономики и менеджмента, Словацкий сельскохозяйственный университет в Нитре, Словакия
Зузана Капсдорферова
PhD, Факультет экономики и менеджмента, Словацкий сельскохозяйственный университет в Нитре, Словакия
БИОЭКОНОМИКА, НЕЙРОЭКОНОМИКА И НЕЙРОМАРКЕТИНГ: НОВЫЕ ПОДХОДЫ К КЛИЕНТАМ И БИЗНЕСУ
Аннотация: Новые подходы, объединяющие несколько дисциплин, таких как экономика, биология, психология, нейробиология и т.д., считаются подходящими для лучшего объяснения экономических событий и сложных экономик сегодняшнего дня. Биоэкономика, возникшая из синтеза экономики и биологии, призвана объяснять экономические события с использованием биологической основы и наоборот, и эта дисциплина важна для защиты окружающей среды и системы жизнеобеспечения. Биоэкономическое моделирование обеспечивает оценку последствий изменений в управлении окружающей средой на основе оценки затрат и выгод, связанных с использованием экологических ресурсов, и определяет оптимальный уровень добычи ресурсов для максимизации экономической прибыли. Нейроэкономика является естественным продолжением биоэкономики, фокусирующейся на поведенческих установках и поведенческих моделях эволюционных процессов. Нейромаркетинг пересекает традиционные границы между нейронаукой, нейроэкономикой и маркетинговыми исследованиями. Цель статьи - дать теоретическую основу для биоэкономики, нейроэкономики и нейромаркетинга на основе недавних эмпирических исследований и описать различные методы, используемые в этих новых прогрессивных подходах.
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INTERNATIONAL JOURNAL OF THEORETICAL AND PRACTICAL RESEARCH
DOI 10.5281/zenodo. 5731674
Ключевые слова: биоэкономика, принятие решений, нейроэкономика, нейромаркетинг.
Introduction
New approaches that integrate several disciplines such as economics, biology, psychology, neuroscience etc. are considered to provide better explanation of economic events and complex economies of today. Economic concept based on biological materials and resources is aimed to create the economy with low emissions in line with requirements of sustainable agriculture and fisheries, food safety and better utilization of renewable energy for industrial processes in ensuring biodiversity and environmental protection. Another new approach in comparison to conventional economic theory is neuroeconomics that studies the impact of emotional, social, psychological and other factors on the various economic decisions and explains the principles of decision-making process and behavioural strategies of consumers based on the neurobiological and psychological aspects. Additionally, marketing theory and practice use the application of neuroscience for better understanding of consumer choice and for influencing consumers' behaviour.
The paper provides a theoretical framework for bioeconomics, neuroeconomics and neuromarketing based on the recent empirical research and describes different techniques used in these new progressive approaches.
The paper is the result of the primary and secondary research in the national research project VEGA 1/0874/14 Using Neuromarketing in Visual Merchandising and International Food Educational Project Erasmus+ Strategic partnership Food Quality and Consumer Studies Nr. 2014-1-SK01-KA203-000464. Also, this work was co-funded by European Community under project no 26220220180: Building Research Centre "AgroBioTech"
Methods
The main aim of the paper is to summarize and discuss the key topics: bioeconomics, neuroeconomics and neuromarketing and to provide an overview of the research techniques and models used in these fields. Recently published international literature dealing with the selected topic has been examined. In order to fulfill the main aim, the comparative method is used for comparing the researcher's opinions on the chosen disciplines and for explaining differences between neuroeconomics and neuromarketing.
Result and Discussion
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DOI 10.5281/zenodo. 5731674
Nowadays, a new and more central role is given to the more sustainable direction of the development of the economy based on the production and usage of biological resources (forestry, fisheries, agriculture, biomass-based industries etc.). [Sundar, 2012] explains that the traditional branch of economics does not link economics with biology, however, a progressive branch of social science called bioeconomics, originated from the synthesis of economics and biology, intends to explain economic events using a biological basis and vice versa. More specifically, it is a change in the development of the economy-environment disciplines such as natural resource economics, environmental economics and ecological economics. Bioeconomics is important to the protection of environment and life support system. The health status of the people can be increased by the production of goods and services through bio-economic method that develops green products and promotes green consumerism. Furthermore, the economics knowledge on utilization of biological resource is needed for achieving sustainable development.
[Boncoeur and Thebaud, 2011]point out that the interaction of biological and economic processes is represented by bio-economic model and it is usually made up of three components: Biological component describes the bio-ecological processes at work; Technical component describes the way human activities interact with the bio-ecological processes; Economic component describes the results of these activities in term of (market or non-market) costs, benefits and the consequences of these results on human behaviour. Bio-economic modeling provides the assessment of the impacts of environmental management changes based on evaluation of the costs and benefits linked with environmental resource usage and it determines the optimal level of resource extraction to maximize economic profits. Various bio-economic models have been developed and tested on different farming systems and under heterogeneous agro-ecological conditions; for example, bio-econometric modeling of fisheries are used to determine the optimal levels of effort under different fisheries management regimes (harvest levels, season length etc.). Agro-economic models predict the impact of changes in environmental resources (water and soil quality etc.) on agricultural production and the following approaches could be used for bioeconomic modelling of agricultural systems: accounting (descriptive book-keeping systems e.g. gross margin analysis), regression (statistical estimates of site-, or region-specific agro-economic production functions based on observed relationships between prices, farm inputs, policies, and physical characteristics of the land) and mathematical programming aimed to optimise and simulate the optimal demand for environmental inputs that maximise farm profits depending on input/output prices, available capital or labour and environmental conditions (e.g. MIDAS). In case of forest models, mathematical programming to maximise net present value of forest biomass volume or Faustmann
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Pressler-Ohlin model for determination of optimal rotation age maximising net present value of timber production for a forest stand are used [Kragt, 2012].
[J.J., 2007] claims that neuroeconomics is a natural extension of bioeconomics focusing also on behavioral dispositions and behavioral patterns of evolutionary processes. Neuroeconomics identifies evolved mechanisms and processes that are at work in decision-making at the neural level of the brain. [Vlasceanu, 2014] states that neuroeconomics and neuromarketing are new emerging interdisciplinary fields that offer a new vision of the decision-making process and both are established on various disciplines and have borrowed a number of methods, techniques and tools of neuroscience.; neuroeconomics is based on e.g. neuroscience, economics, mathematics, statistics and cognitive sciences and neuromarketing is based on fields such as neuroscience, economics and psychology. Neuroeconomics focuses on the activity of our brains when we are in the evaluation process of reward (deci-sion making process about money) or fear e.g. if we calculate risks. [Neumarker, 2007] points out that neuroeconomists believe that the study of neural mechanism behind human decision-making process is essential for finding right and unique decision mechanism for the accurate prediction of behaviour and economic outcomes. Neuroeconomics rediscovers the research of the classical contributors to the economic theory of human behavior by adding and specifying important components of human behavior (many of which are ignored in standard economics), by arguing on the unity of behavioural sciences and by drawn the economist's attention to the brain processes of human decision-making. Furthermore, neuroeconomics discover final causes of human decision-making together with bioeconomic studies. According to [Bickel, 2006], the brain function can be examined in decision making and choice by brain imaging techniques such as functional magnetic resonance imaging (fMRI) or position emission tomography (PET). These techniques determine areas of relative brain activation, and deduce the specific portions of brain used during decision making tasks in various circumstances (e.g. under uncertainty, in social situations). Functional magnetic resonance imaging is non-invasive method and it works due to different magnetic properties of oxyhemoglobin! and deoxyhemoglobin. For example, Montague et al. examine neuronal responses associated with preferences for soft drinks by performing fMRI. Subjects are more likely to prefer Coke over Pepsi during informed testing in comparison to blind testing, and this preference is reflected in increased neuronal activation in brain regions assumed to be involved in reward. This research makes clear the neuronal underpinnings of brand effects, which can strongly influence consumer choices [Braeutigam, 2005].
"Neuromarketing is a recent interdisciplinary field which crosses traditional boundaries between neuroscience, neuroeconomics and marketing research" say
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[Ulman and Yildiz, 2015]. [Hubert, 2010] explains that neuromarketing is a consumer neuroscience and a sub-area of neuroeconomics that investigates marketing-relevant problems. The discipline provides better understanding of how unconscious mind processing influences the decision to purchase and it helps to understand the consumers' thoughts, emotions, feelings, needs and motivation in relation to the marketing products. Neuromarketing could also help buyers and marketing experts to understand each other better, but also to understand better the products they want, which leads to a win/win situation for both sides [Wilson, 2008]. Häusel (as cited in [Gentner, 2012]) describes the possibilities of neuromarketing as follows:
Understanding of the unconscious decision-making processes and neural mechanisms; Identification of the various emotional systems in the human brain and investigation of their functions;
■ Research of how various channels of perception can be used effectively; Analysis of the attention and cognitive processes in the brain;
■ Optimization of text and language; Identification of certain consumer types and their better and more successful segmentation;
■ Determination of effects of differences in thinking style, emotional structure and behavior for marketing purposes;
■ Development of effective and efficient strategies in order to reach aging consumers.
[Javor, 2013] consider neuromarketing as a term often used in the media in recent years, however, on-going debate have been focused on potential ethical aspects and the public fear of negative consequences for society, more specifically for consumers. Nevertheless, other researchers and journalists believe that neuromarketing is considered to be beneficial for consumers due to the fact that it would lead to product improvement. Therefore, authors warn that it is important to distinguish academic studies using neuroscientific methods with focus on the consumer's point of view from commercial marketing aimed to apply findings in order to sell product. Additionally, neuromarketing research techniques (represented by electroencephalography, magnetoencephalography, functional magnetic resonance imaging, eyetracking glasses and the galvanic-skin response) are essential for gathering valuable insights in connection with the neural substrates of emotional intelligence and allow researchers to seize short-lived interaction between different brain structures during the decision making process [Pop, 2013]. More specifically, the electroencephalography (EEG) belong to the most widespread instruments aimed to measure brainwaves' activity and it helps to understand the way the brain responds to various stimuli, say [Pradeep, 2010]. Lewis (as cited in [Krajnovic, 2012]) considers EEG method to be the most practical, the most cost-effective and the most suitable among the currently developed
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methods while taking into consideration the simplicity of use and compactness of the apparatus. The functional magnetic resonance imaging measures the increase of the oxygen level in the brain's blood flow; magnetoencephalography records the magnet fields generated by the brain's electrical activity and it helps to notice changes in the brain's electrical activity; and eye tracking is aimed to observe the way the print influences the subject's attention and cognitive processing.
[Breiter, 2015] explain differences between neuroeconomics and neuromarketing. Neuroeconomics generally explains how the individuals make their choices and represents distribution of choices. There are four steps in the process of making a choice (Figure 1 (A)). On the other hand, neuromarketing focuses on how individuals and groups can be shifted or altered from one pattern of decisions to another pattern, or to change their distribution of choices. One potential model for the effect of influence on behaviour is shown in Figure 1 (B) where influence can be considered the difference in gradients for preference inside a person and outside a person and behaviour feeds back onto these internal and external gradients of preference as experienced utility of expressed behaviour.
Figure 1: Comparison of neuroeconomics and neu- romarketing.
Conclusion
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The paper presented recent findings from studies of bioeconomics, neuroeconomics and neuromarketing with the emphasis on their features, techniques and models for gathering valuable outcomes. A progressive branch of social science called bioeconomics, originated from the synthesis of economics and biology, intends to explain economic events using a biological basis and vice versa. Various bio-economic models have been developed and tested on different farming systems and under heterogeneous agro-ecological conditions e.g. bio-economic modelling of fisheries, forest and agro-economic models. Neuroeconomics is a natural extension of bioeconomics and it explains how the individuals make their choices and represents distribution of choices. On the other hand, neuromarketing focuses on how individuals and groups can be shifted from one pattern of decisions to another pattern, or to change their distribution of choices. Neuroeconomics uses brain imaging techniques such as functional magnetic resonance imaging or position emission tomography to explore brain function in decision making and choice. Electroencephalography, magnetoencephalography, functional magnetic resonance imaging, eye-tracking glasses and the galvanic-skin response belong to the neuromarketing research techniques that are essential for understanding short-lived interaction between different brain structures during the decision-making process.
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