Decision Making Lecture Flashcards
(20 cards)
What is base rate neglect?
A failure to take into account the basic frequency of something in a population
Bayes theorem
Established the strength of evidence for a belief
Combines base rates with new information
Advantages of bayes theorem
Mathematically correct and produces optimal set of beliefs
What are heuristics?
Strategies that ignore part of the information with the goal of making decisions more quickly and frugally than complex methods
Algorithms
A precise method that always gives the same correct answer
Representative heuristic
Deciding something belongs to a given category because it appears typical or representative
Availability heuristic
Frequencies of event estimated on the basis of how easy it is to retrieve them from long term memory
Affect heuristic
Risk for whatever dread is higher
What theory was brought forward by Herbert Simon?
Bounded rationality
What is bounded rationality?
Semi-rational but constrained by minds resources
Fast and frugal heuristics
Quick decision making
Daniel Kanneman theory
Dual process theory
Two systems in the dual process theory
System 1 - fast, automatic, effortless. Difficult to control
System 2 - slower, serial, effortful, flexible
Evidence for dual process theory
Rational responses to the Linda problem are slower and more affected by a secondary task
What idea did gird figurines present?
Heuristics usually give the right answer out in the real world
Inductive reasoning
Draws general conclusions from particular instances
Deductive reasoning
Allows us to draw conclusions that are certain
Belief bias
Tendency to accept invalid conclusions is they are believable and reject valid conclusions
Example of belief bias
All children are obedient
All girl guides are children
Therefore all girl guides are obedient
Expected utility
Problem of outcome x utility of the outcome
Outcome bias
Judging a decision by its ultimate outcome instead of based on the quality of the decision at the time it was made
