2 Decision Making 2 different types of models for decision making Prescriptive modelsModels describing the best way to make a decisionDescriptive modelsModels describing the way decisions are actually madeCognitive psychologists are interested in how people actually make decisions
3 Classical Decision Theory Assumed decision makersKnew all the options availableUnderstood pros and cons of each optionRationally made their final choiceGoal was to maximize value of decision
4 Howard’s Dilemma Thagard & Milgram (1995) “An eminent philosopher of science once encountered a noted decision theorist in a hallway at their university. The decision theorist was pacing up and down, muttering, ‘What shall I do? What shall I do?’‘What's the matter, Howard?’ asked the philosopher.Replied the decision theorist, ‘It's horrible, Ernest - I've got an offer from Harvard and I don't know whether to accept it.’‘Why Howard,’ reacted the philosopher, ‘you're one of the world's great experts on decision making. Why don't you just work out the decision tree, calculate the probabilities and expected outcomes, and determine which choice maximizes your expected utility?’With annoyance, the other replied, ‘Come on, Ernest. This is serious.’ ”Howard Dilemma text taken from: Thagard, P. and Millgram, E. (1995) Inference to the best plan: A coherence theory of decision. In A. Ram & D. B. Leake (Eds.), Goal-driven learning: (pp ). Cambridge, MA: MIT Press.
5 Subjective Utility Theory GoalSeek pleasure and avoid painActual judgment of pleasure and pain is made by each decision maker (subjective)
6 Subjective Expected Utilities Consider all possible alternativesUse all information currently knownWeigh potential costs and benefitsSubjective weighing of various outcomesSound reasoning consider above factors
7 Satisficing To obtain an outcome that is good enough Term introduced by Herbert A. Simon in his Models of Man 1957Simon noted that humans are rational but within limits (bounded rationality)
8 Elimination by Aspects Tversky (1972)Begin with a large number of optionsDetermine the most important attribute and then select a cutoff value for that attributeAll alternatives with values below that cutoff are eliminatedThe process continues with the most important remaining attribute(s) until only one alternative remains
9 Group Decision Making Can enhance decision making More ideas Better memory of events
10 Disadvantage of Group Decisions GroupthinkPremature decision made by members trying to avoid conflict
11 Symptoms of Groupthink Closed-mindednessRationalizationSquelching of dissentFormation of “mindguard”Feeling invulnerable
12 Heuristics Influencing Decision Making RepresentativenessAvailabilityAnchoring & adjustmentOverconfidenceIllusory correlationHindsight biasDiscuss how these factors influence decision making, sometimes leading us to the correct decision and sometimes leading us astray.
13 Making DecisionsChris is 6’7”, 300 pounds, has 12 tattoos, was a champion pro wrestler, owns nine pit bulls and has been arrested for beating a man with a chain.Is Chris more likely to be a man or a woman?A motorcycle gang member or a priest?How did you make your decision?
14 Making DecisionsSteve is meek and tidy, has a passion for detail, is helpful to people, but has little real interest in people or real-world issues.Is Steve more likely to be a librarian or a salesperson?How did you come to your answer?
15 Making DecisionsLinda is a 31-year-old, single, outspoken, and very bright person. She majored in philosophy. As a student, she was deeply concerned with issues of discrimination and social justice, and also participated in antinuclear demonstrations.What is the probability that Linda is a bank teller?What is the probability that Linda is a feminist bank teller?
16 Representativeness Heuristic Judge probability of an event based on how it matches a stereotypeCan be accurateCan also lead to errorsMost will overuse representativenessi.e. Steve’s description fits our vision of a librarian, Linda seems to be more of a feminist
17 Representativeness Heuristic Gambler’s FallacyMistaken belief that a random event is affected by previous random eventsBelieve that “your turn to win” has comeIn reality, probability to win is still same probability
18 Base rate Information The actual probability of an event How many bank tellers are there in the world?How many feminists are there?Much research in the 1970’s &1980’s seemed to indicate that base rate information in these type of problems were ignoredCurrent research focuses on when participants do pay attention to base ratesKoehler, J.J. (1996). The base rate fallacy reconsidered: Descriptive, normative, and methodological challenges. Behavioral and Brain Sciences 19 (1): 1-53.
19 Koehler (1996) Base rates are used when Problems are written in ways that sensitize decision-makers to the base rateProblems are conceptualized in relative frequency termsProblems contain cues to base rate diagnosticityProblems invoke heuristics that focus attention on the base rateKoehler, J.J. (1996). The base rate fallacy reconsidered: Descriptive, normative, and methodological challenges. Behavioral and Brain Sciences 19 (1): 1-53.
20 Making Decisions Which are you more afraid of? Meyers (2001) Flying in an airplaneDriving in a carMeyers (2001)“The Air Transport Association reports that 483 passengers were killed in plane crashes from (97 per year). During these years, the National Safety Council's Research and Statistics Department tells me, we were 37 times safer per passenger mile in planes than motor vehicles.”Myers, D. G. (2001, December 14). Fearing the wrong things. American Psychological Society Observer.
21 Availability Heuristic Making judgments about the frequency or likelihood of an event based on how easily instances come to mindActual frequency influences how easily evidence comes to mind but so do other factorsMediaVividness
22 Schwartz (1991)Manipulated how many instances participants had to give of previously being assertiveOne group had to recall six examples of when they had been assertiveA second group had to think of twelve examplesBoth groups were then asked to score their assertivenessParticipants who thought of six examples scored themselves higher than the group that had difficulty thinking of twelve examplesPattern of results attributed to the availability heuristicSchwarz, N. Bless, H, Strack, F., Klumpp, G., Rittenauer-Schatka H., & Simons, A. Ease of Retrieval as Information: Another Look at the Availability Heuristic , Journal of Personality And Social Psychology, Vol. 61, Issue 2.
23 Anchoring-and-Adjustment Heuristic Begin by guessing a first approximation (an anchor)Make adjustments to that number on the basis of additional informationOften leads to a reasonable answerCan lead to errors in some cases
24 Anchoring-and-Adjustment People are influenced by an initial anchor valueAnchor value may be unreliable, irrelevant, and adjustment is often insufficient
25 Anchoring-and-Adjustment Participants asked to calculate in 5 secs the answer to one of the following problems:1 x 2 x 3 x 4 x 5 x 6 x 7 x 8= 5128 x 7 x 6 x 5 x 4 x 3 x 2 x 1= 2,250The order of presentation for these two groups had a significant impact on their estimatesThe correct answer, in both cases, is 40,320!People do not have sufficient time to calculate the answer. Instead they perform a few steps of computation from left to right (i.e. anchoring) and then they estimate the answer by extrapolation (i.e. adjustment).
26 Effect of Framing on Decisions Which choice would you make?Suppose you have invested in stock equivalent to the sum of $60,000 in a company that just filed a claim for bankruptcy. They offer two alternatives in order to save some of the invested money:If Program A is adopted, $20,000 will be savedIf Program B is adopted, there is a 1/3 probability that $60,000 will be saved and a 2/3 probability that no money will be saved
27 Rönnlund, Karlsson, Laggnäs, Larsson, & Lindström (2005) Examined the impact of framing on risky decisionsManipulated age (young/older) and type of framing (positive/negative)Participants read one of 3 scenariosParticipants selected either a risky or certain outcomeRönnlund, M., Karlsson, E., Laggnäs, E., Larsson, L., & Lindström, T. (2005). Risky decision making across three arenas of choice: Are younger and older adults differently susceptible to framing effects? Journal of General Psychology, 132,
28 Sample ScenarioSuppose you have invested in stock equivalent to the sum of $60,000 in a company that just filed a claim for bankruptcy. They offer two alternatives in order to save some of the invested money:Positive FramingIf Program A is adopted, $20,000 will be saved (certain outcome)If Program B is adopted, there is a 1/3 probability that $60,000 will be saved and a 2/3 probability that no money will be saved (risky outcome)Negative FramingIf program A is adopted $40,000 will be lost (certain outcome)If program B is adopted, there is a 1/3 probability that no money will be lost, and 2/3 probability that $60,000 will be saved (risky outcome)Rönnlund, M., Karlsson, E., Laggnäs, E., Larsson, L., & Lindström, T. (2005). Risky decision making across three arenas of choice: Are younger and older adults differently susceptible to framing effects? Journal of General Psychology, 132,
29 Try It!Write your name on a piece of paper and indicate the truth of the following statements1 means you are sure it is true, 10 means you are sure it is falseTruthRating1. Martin Luther King was 39 when he died.2. The gestation period of an Asian elephant is 225 days.3. The earth is the only planet in the solar system that has one moon.4. The number of lightning strikes in the United states per year is 25 million.5.The Rhöne is the longest river in Europe.Collect the sheets.
30 Try It Answers Martin Luther King was 39 when he died The gestation period of an Asian elephant is not 225 days--It is 645 daysThe earth is the only planet in the solar system that has one moon. False, Pluto also has one moonThe number of lightning strikes in US is approximately 25 millionThe Rhöne is not the longest river in EuropeGo over the answers.The Volga is the longest river in Europe. It flows over 3,500 kilometers (1,900 miles).
31 Illusory Correlations An illusory correlation is a perceived relationship that does not, in fact, existIllusory correlations are formed by the pairing of two distinctive eventsRedelmeier and Tversky (1996)18 arthritis patients observed over 15 monthsThe weather was also recordedMost of the patients were certain that their condition was correlated with the weatherThe actual correlation was close to zero What illusory correlations may affect your decisions?Example of illusory correlations taken from
32 Demonstration- Future events Predict whether you will experience these events this semesterObtain an A in your favorite course.Have an out-of-town friend visit you.Lose more than ten pounds.Drop a course after the 5th week.Be the victim of a crime.Get a parking or speeding ticket.How confident are you of your judgment for each item? (100%, 80%, 60%.....)This is a demonstration about judging own future outcomes.Have students make a prediction about each of the items. Then have them give a confidence rating to each item.
33 OverconfidencePeople tend to have unrealistic optimism about their abilities, judgments and skillsExamine your confidence judgments about future events asked on a previous slide—are you confident your judgments are accurate?
34 Dunn & Story (1991) Examined overconfidence of students At beginning of the semester students were given 37 items like the ones on the previous slideAt end of the semester, students were asked to indicate which events had actually occurred
35 Dunn & Story (1991)Results indicated that all students exhibited large tendencies toward overconfidenceConfidence influences how we make decisions, yet our confidence may not be based on a realistic estimate of events or skillsWhy is this a problem?
36 Try it again…Predict your past answer 1 means you were sure it was true10 means you were sure it was falseYour past answer1. Martin Luther King was 39 when he died.2. The gestation period of an Asian elephant is 225 days.3. The earth is the only planet in the solar system that has one moon.4. The number of lightning strikes in the United states per year is 25 million.5.The Rhöne is the longest river in Europe.Once students have completed their answers. Hand them back their old sheets. See if their values on 1 & 4 are closer to 1 (indicating true), while their answers on 2, 3, & 5 are now closer to 10 (indicating false).If their answers follow this pattern, they demonstrate the hindsight bias. Also gives opportunity to discuss individual variability.
37 Hindsight BiasThe memory of how we acted previously changes when we learn the outcome of an event
38 Hindsight Bias Reconstruction after feedback theory (RAFT) Proposed by Hoffrage,Hertwig & Gigerenzer (2000)Allows us to remove clutter by tossing out inaccurate information and embracing the right answers in our memoryHoffrage,U., Hertwig, R. , and Gigerenzer, G. (2000). Hindsight Bias: A By-product of knowledge updating? Journal of Experimental Psychology: Learning, Memory and Cognition, Vol. 26, No. 3,
39 Do People Reason Logically? Deductive reasoningFormal procedure that ensures accuracy if rules of logic are followedGiven some premises that are true, one can reach a conclusion that must also be trueExample:All men are mortal.Socrates is a man.Therefore, Socrates is mortal.
40 Deductive Validity How do we know when an argument is valid? Typically deductive arguments have three statements:If P, then Q (Conditional if-then statement)Statement about whether P or Q is true or not trueA conclusion about P or Q
41 Two Valid Deductive Inferences Modus PonensIf P, then Q All fruit grows on treesP is true An apple is a fruitQ is true Therefore, apples grow on treesModus TollensNot Q Tomatoes do not grow on treesNot P Therefore, tomatoes are not a fruit
42 Two Deductive Fallacies or Errors Denying the antecedentIf P, then Q All fruit grows on treesNot P Tomatoes are not a fruitNot Q Therefore, tomatoes do not grow on treesAffirming the consequenceQ Acorns grow on treesP Acorns are fruitWhile these arguments can also look logical, given the nature of the premises, the arguments presented are not logically valid.
43 Wason Card Selection Task 2X3Each card has a letter on one side and a digit on the other. Determine by turning over the minimum number of cards if this rule is true: If there is a vowel on one side, there is an even number on the other side.Do not go to next slide until students have attempted to solve the problem.Correct answer is to turn over the A and the 3.
44 Wason Selection Task A 2 X 3 If vowel then even number on the other sideMust turn over A (Modus Ponens)Most get this card right, confirmation biasBecause a vowel, want to see if even number of other sideMust turn over 3 (Modus Tollens)Only 15% of college students get this correctMust be sure there is not a vowel on the other side2 card doesn’t matterRule does not state that all even numbers have to have vowelsX card doesn’t matter.Rule does not specify anything about consonants.
45 Syllogistic Reasoning Statement 1: All men are animals Statement 2: Some animals are aggressive Conclusion: Some men are aggressive This seems to be a reasonable conclusion, but then consider the following: Statement 2: Some animals are female Conclusion: Some men are female Now the conclusion appears to be ridiculous and false - yet the reasoning is exactly the same as in the first example. Thus, the first example has a false conclusion. The animals who are aggressive are not necessarily men.
46 Beer 22 Coke 17 Griggs & Cox (1982) Four people are sitting at a table. Who do you question to determine whether the law is being broken? If a person is drinking beer, then the person must be 21 or over.Participants averaged 72% correct.People choose the beer card and the age 17 card.Discuss why people are so good when the problem is in context.
47 Pragmatic Reasoning Schema Cheng & Holyoak (1985)Theorized a permission schema exists that helps to solve the problemOnce activated, the schema enables the person to determine what evidence is necessary to evaluate the ruleActivated by a context that involves permissionTo use the pool, you must be a patron of the hotel
48 Cheng & Holyoak (1985)Reframed the Wason card selection task in the form of a permission statementFound that 61% of college students now got the problem correct versus only 19% when the problem was not framed in terms of permissionCheng, P. W. & Holyoak, K. (1985). Pragmatic reasoning schemas. Cognitive Psychology, 17,
49 Syllogistic Reasoning Draw a conclusion based on two premisesA major premiseA minor premiseA conclusion
50 Syllogistic Reasoning True Categorical SyllogismFalse Categorical SyllogismAll men are animals Some animals are aggressive Some men are aggressiveAll men are animals Some animals are female Some men are femaleThe second conclusion appears to be ridiculous and false- yet the reasoning is exactly the same as in the firstexample. The first example thus has a false conclusion.The animals who are aggressive are not necessarily men
51 How do People Solve Syllogisms? Mental ModelA mental model represents one possibility, capturing what is common to all the different ways in which the possibility may occur.Mental models represent explicitly what is true, but not what is false. These characteristics may lead to systematic errors.
52 Working Memory and Syllogisms Gilhooly & Associates (1993)Present syllogisms orally or visuallyOral presentation leads to heavier load on working memoryParticipants in the oral presentation performed more poorly.
53 Obstacles to Deductive Reasoning Overextension errorsForeclosure errorsConfirmation bias
54 Enhancing Deductive Reasoning Avoid heuristics and biases that distort our reasoningConsider more alternativesTraining and practiceBeing sad
55 Evolutionary View Cosmides & Tooby (1996) Humans are social animals Humans have evolved to deal well with social rules
56 Inductive ReasoningInvolves reasoning from specific cases to more general, but uncertain, conclusionsCannot reach a conclusion with 100% accuracyCan reach a highly probable outcome
57 How People Make Causal Inferences John Stuart Mill’s CannonsMethod of AgreementMethod of Difference
59 Schustack & Sternberg (1981) Results Indicated 4 pieces of information were used to determine causalityJoint presence of possible cause and outcomeJoint absence of cause and outcomeIf one was absent and other was present then no causality
60 Confirmation BiasTendency to search for and interpret evidence in a way that confirms our theories and avoid evidence that contradicts prior beliefsE.g., Self-fulfilling prophecy
61 Deductive vs. Inductive Reasoning Turvey (1999) provides example of each type of reasoning in a forensic contextDeductive reasoningFingerprint in blood is on knifeFingerprint belongs to DTherefore, D was in contact with knife after victim began to bleedInductive reasoning85% of known killers who use severe blunt force trauma to the faces of their victims live with their mother75% of known killers who tie up their victims during a crime are between the ages of 25-31, drive a 4x4 truck, are white, and are highly intelligentTherefore, the offender may be a white male, age 25-31, who lives with his mother, and drives a 4x4 truck.Turvey, B. (1999) Criminal Profiling: An Introduction to Behavioral Evidence Analysis, Academic Press, San Diego, 1999.
62 Alternate View of Reasoning Sloman (1996)Two complementary systems of reasoningAssociative systemRule-based system