Behavioral financial planning research is focused on the assessment and evaluation of psychological and physiological events as they pertain to economic behavior. Behavioral financial planners use a number of traditional economic, psychological, and psychophysiological theories to guide their work. A working assumption is that behavior and cognitive processing are indivisible and that behavioral, cognitive, and physiological tools and techniques can be combined to create interventions that improve the economic well-being of individuals and households.
One area of behavioral financial planning of interest to those working the Lab is the role of the peripheral nervous system as it relates to economic behavior. The peripheral nervous system includes the spinal and cranial nerves. Of specific relevance to behavioral financial planning researchers is the Autonomic Nervous System (ANS). ANS regulates glands and other internal organs—what are known as visceral structures. Together, these structures control involuntary physiological activities and behavior. Rather than base behavioral interventions entirely on observations of human behavior or on activities within the brain, the behavioral financial planning approach allows researchers to directly measure the sympathetic nervous system as a person responds to stressors within the environment. It is precisely how someone reacts physiologically to specific economic stressors, rather than how they plan to react, that likely shapes the person’s present and future behavior.