Essay about Theoretical Models of Decision Making

4797 Words Apr 20th, 2013 20 Pages
Theoretical models of decision-making, and their neuroscientific underpinnings
Introduction
In this essay I would like to focus the theoretical models of decision making that have come from psychology, cognitive and ecological alike, and review relevant literature from cognitive neuroscience that may or may not provide neural foundation for the claims that they have formulated. The reason for which I find it interesting to contrast these two approaches is there different outlook on the concept of “bias”.
Traditional – closed systems - approaches to decision-making
The investigation of decision-making is a multidisciplinary endeavor with researchers approaching the area from different fields and applying numerous different models
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This resulted in the emergence of “structural” theories relating decision-making to structural characteristics of the decision problem (Ranyard, Crozier, & Svenson, 1997). Prospect theory, proposed by Kahneman and Tversky (1979) was the most influential, heralding an important milestone in the history of the heuristics and biases approach. Cognitive psychology advocates an ‘information processing’ model of cognition, with the main focus on the process underlying judgment and decision-making, assumed to involve “the serial manipulation of symbols that reflect the internal representation of a problem” (Payne & Bettman, 2004, p. 113).
Heuristics and Biases approach
Daniel Kahneman and Amos Tversky proposed that in contrast with the normative (aka. optimization models) decision models that were used by classical economy, people use cognitive shortcuts under uncertainty, so called judgmental “heuristics” in order to ease cognitive workload (Griffin, Gonzalez, Koehler, & Gilovich, 2012)
In order to understand the scientific setting that has paved the way for one of the big revolutions in social sciences, I feel it necessary to mention some of the relevant research that admittedly affected their work. First off, Herbert Simon (1957) Nobel Prize winner made strong arguments regarding the limited capacity of the decision maker, and introduced to term “bounded rationality”. He borrowed the use of the term “heuristic” from computer science and artificial

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