Fight or freeze? Individual differences in investors’ motivational systems and trading in experimental asset markets

We analyze investors’ trading behavior, particularly their coping with fundamental shocks in asset value, depending on individual differences in the sensitivity of two basic neurophysiological systems—the Behavioral Approach System (BAS), the ‘driving force’ of human behavior, and the Behavioral Inhibition System (BIS), its ‘braking system’. By analyzing 15 independent experimental asset markets with a total of 171 participants, we find that...