Keynes's Animal Spirits Vindicated: An Analysis of Recent Empirical and Neural Data on Money Illusion

Posted: 10 Oct 2017

See all articles by Sacha Bourgeois-Gironde

Sacha Bourgeois-Gironde

École Normale Supérieure (ENS); Université Paris II

Marianne Guille

Independent

Date Written: 2010

Abstract

The tendency of people to think of money in nominal, rather than real, terms is now well documented by recent empirical data. In particular, experimental and neurobiological data provide new insights on the individual and subindividual (neurobiological processes) anchoring of money illusion. The sensitivity of the reward brain system to the nominal format of money may explain money illusion at a biological level and provide a sort of physical demonstration of Keynes animal spirits hypothesis. These findings make it more difficult to ignore the hedonic or emotional dimension of money, which lies outside the scope of homo economicus.

Keywords: animal spirits, experimental economics, money illusion, neuroeconomics, Keynes

JEL Classification: D87, E41, E71

Suggested Citation

Bourgeois-Gironde, Sacha and Guille, Marianne, Keynes's Animal Spirits Vindicated: An Analysis of Recent Empirical and Neural Data on Money Illusion (2010). Available at SSRN: https://ssrn.com/abstract=3033761

Sacha Bourgeois-Gironde (Contact Author)

École Normale Supérieure (ENS) ( email )

45 rue d’Ulm
Paris Cedex 05, F-75230
France

Université Paris II ( email )

12 place du Pantheon
Paris cedex 06, 75231
France

Marianne Guille

Independent

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