NEUROPRICING AND THE FUTURE OF DEMAND: HOW BRAIN DATA COULD REDEFINE WILLINGNESS-TO-PAY AND ELASTICITY

The concept of neuropricing, which uses neural signals to set personalized prices, marks a significant change in economic theory and practice. Traditional microeconomics models assume that willingness-to-pay (WTP) is shown through observable choices. This allows economists to create demand curves and estimate elasticity.Neuromarketing challenges this idea by proposing that we can access consumer valuations directly through brain imaging, EEG (electroencephalography), eye-tracking, and other biometric tools.This paper looks at how neuropricing might change our understanding of demand. It focuses on the elimination of consumer surplus, the flattening of demand elasticity, and the ethical issues that arise.Drawing from research in neuroeconomics, behavioural economics, and the theory of price discrimination, it argues that neuropricing could lead to nearly perfect first-degree price discrimination. While this might improve efficiency, it could also harm fairness and consumer power. The paper ends by discussing potential policy responses and emphasizing the need to rethink elasticity in a world where companies can read the brain.