Abstract:Humans can be motivated not only by material (monetary) payoffs but also by morals, feelings, emotions or social norms in their daily decision-makings, thus exhibit deviations from the material self-interested maximizing behaviors. Psychological game theory, based on belief-dependent motivations, has led to research fervor onemotional decision-makings. In Psychological games, players’ utilities depend not only on the terminal material payoffs, but also directly depend on their psychological state triggered by their beliefs. This paper systematically reviews researches focused on belief-dependent motivations. After briefly presenting the fundamental framework of belief and psychological game theory, this paper summarizes and evaluates belief-dependent essential human motivations such as intention-based reciprocity, disappointment and guilt aversion, self-image and social image, anxiety and utility from anticipation, etc. We also discuss the main experimental and neuroscience evidences related to this topic. It is expected that as the research of belief andpsychological games moves along, researches on emotional decision-makings, trust, institution, and non-market decisions will be greatly influenced, as well as the issue of multi-disciplinary uniﬁcation.
Key Words:Belief-Dependent Motivations; Psychological Game Theory; Emotions; Belief-Elicitation Experiments
JEL Classification:C72, C91, D01