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31 Cards in this Set
- Front
- Back
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What is a judgement? |
- an assessment about a given situation based on all available info - comes before a decision |
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What is a decision? |
- a commitment to take a course of action |
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What makes a decision good or bad? |
- the outcome (If the outcome is good, it’s a good decision. If the outcome was bad, it’s a bad decision) |
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How do we assess the outcome of a decision before actually making one? |
High |
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Quality decisions |
- outcome - probability of the outcome (how likely is it that, that outcome will persist) - utility (does this benefit me?) |
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Maximising Expected Utility |
- assign utilities to the different outcomes possible (ranking) - assign probabilities to each utility (how likely is it that this will happen) - multiply the probability by the utility to derive at the most beneficial decision (the one with the highest value) |
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Multi-attribute utility measurement |
- another form of maximising expected utility except, for each decision there are multiple attributes - list all the attributes/factors for each decision - score each attribute on a scale from 0-100 - multiply the weight of the attribute by the score |
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Naturalistic decision-making |
- how people make decisions in demanding & high pressure situations - relies on the environment and experience - recognition-primed decision-making model |
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Recognition- primed decision-making model |
- relies on experiences of similar situations to help make decisions - 3 variants - 3 stages |
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Variant 1 |
- decision-maker understands the situations - both the details of the situation and possible course of action is known |
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Stages |
- experience the situation (look & listen) - analyse (compare to previous experiences) - implement |
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Variant 2 |
- lacks knowledge about the situation - required to diagnose the situation so that they can choose a course of action |
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Variant 3 |
- aware of the situation but does not know the right course of action - trial and error |
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Criticisms of the heuristic and biases approach: |
- many argue that relying on heuristic biases lead to errors in decisions - mind & environment |
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Criticisms of the heuristic and biases approach: |
- many argue that relying on heuristic biases lead to errors in decisions - mind & environment - fast & frugal |
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Mind and environment |
- critics of the heuristic and biases approach neglect the interaction between the decision-maker and the environment - according to probability theory the decision might be incorrect, but one should consider the environment |
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Fast & frugal |
- ecological rationality (structure of environments, structure of heuristics and the match between them) - attempts to determine why and when a heuristic will fail/succeed - take the environment into consideration (probability theory does not) |
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Attitude to risk |
- unrealistic optimism - risk compensation - personality variables - addiction |
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Fast & frugal |
- ecological rationality (structure of environments, structure of heuristics and the match between them) - attempts to determine why and when a heuristic will fail/succeed - take the environment into consideration (probability theory does not) |
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Attitude to risk |
- unrealistic optimism - risk compensation - personality variables - addiction |
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Unrealistic optimism |
- belief that they are immune/at a reduced risk |
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Prospect theory |
- another theory to help understand how people make decisions - argues that people overweight certain outcomes (certainty effect) |
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Prospect theory |
- another theory to help understand how people make decisions - argues that people overweight certain outcomes (certainty effect) |
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What is the certainty effect? |
- overweighting certain outcomes - eg: overweighted the 20% of receiving nothing |
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Prospect theory |
- another theory to help understand how people make decisions - utilities & probabilities undergo cognitive distortions - argues that people overweight certain outcomes (certainty effect) |
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Prospect theory |
- another theory to help understand how people make decisions - utilities & probabilities undergo cognitive distortions - argues that people overweight certain outcomes (certainty effect) - gave rise the the nudge approach |
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Prospect theory |
- another theory to help understand how people make decisions - utilities & probabilities undergo cognitive distortions - argues that people overweight certain outcomes (certainty effect) - gave rise the the nudge approach |
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The nudge approach |
- argues that people’s decisions are influenced by the choice architecture (how options are presented to us) |
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Prospect theory |
- another theory to help understand how people make decisions - utilities & probabilities undergo cognitive distortions - argues that people overweight certain outcomes (certainty effect) - gave rise the the nudge approach |
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The nudge approach |
- argues that people’s decisions are influenced by the choice architecture (how options are presented to us) |
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The boost approach |
- assumes decision-makers competence can be improved by developing skills/ restructuring the environment |
