Chapter 13-pt. 2 Flashcards
Pragmatic Reasoning Schema
Thinking about cause and effect in the world as part of experiencing every day life
Permission Schema: if A is satisfied, B can be carried out
- used in the concrete versions
- people are familiar with these rules
Evolutionary principles of natural selection
Wason task governed by built in cognitive program for detecting cheating (in contrast to permission Schema)
Social exchange theory
An important aspect of human behaviour is the ability of two people to cooperate in a way that is beneficial to both of them
Cosmides and Tooby
- created unfamiliar situations where cheating could occur
- people look for denying the consequent in their experiment because they want to check who are cheating
- if a man eats cassava root, then he must have a face tattoo on his face
- participants did well
- evidence against permission Schema (kind of like cheating-they do well not because they are following the rules but because they are familiar with it)
What is clear so far are:
Context is important
Familiarity is not always important
Expected utility theory
People are rational
If they have all relevant information, they will make a decision that results in the maximum expected utility
Utility: outcomes that are desirable because they are in the person’s best interest
E.g. maximum monetary pay
Advantages and disadvantages for utility approach
Advantages for utility approach:
-specific procedures to determine the “best choice”
Problems for utility approach:
- not necessarily money, people find value in other things
- many decisions do not maximize the probability of the best outcome
Expected utility theory experiment
Participants could choose to randomly pick a jelly bean from a bowl with 1 red bean and 9 white beans or a bowl with 7 red beans and 93 white beans. Participants received money if they picked a red bean
Participants picked the second bowl (less probability of actually choosing a red bean but they based their decisions on the number of red beans only-goes against the expected utility theory)
Emotions in decision making
Expected emotions:
-emotions that people predict that they will feel concerning an outcome
Immediate emotions:
-experienced at the time a decision is being made
People inaccurately predict their emotions
Kermer et.al and his experiment on how people greatly overestimate the expected negative effect of losing
Flip a coin-either lose $3 or win $5
People greatly overestimated how upset they would be if they lost
For positive emotion (of winning) the differences aren’t very big
Incidental emotions
Emotions that are not specifically related to decision making
- may be related to ones general disposition or personality, some recent experience, or ones general environment or surroundings
- can affect ones overall decision making process
How incidental emotions affect decisions regarding setting prices to sell or buy an item
Neutral: high sell low buy
Disgust: about the same
Sad: low sell high buy
Focusing illusion
Focus on just one aspect of situation and ignore other aspects that may be important
E.g. how happy are you?/how many dates did you have last month?
Correlation higher if ask dating first
The effect of context on decision making
The likelihood that physicians would recommend a c section was the same if the test case was presented first or if it was preceded by four serious cases that required a c section
However, the likelihood that physicians would recommend a c section was higher if the same test case was preceded by four nonserious cases that didn’t require a c section
Opt in/opt procedure and status quo bias
Decisions depend on how choices are presented
Opt-in procedure: active step to be organ donor
Opt-out procedure: organ donor unless request not to be (more donors in this case because they don’t have to make the decision)
Status quo bias: the tendency to do nothing when faced with making a decision
Risky decisions
Risk-aversion strategy used when problem is stated in terms of gains
Risk-taking strategy when problem is stated in terms of losses
Review example slides
Framing effect
Decisions are influenced by how a decision is stated (can highlight one aspect of a situation)
Tverksy and Kahnemann
- when situations are framed in terms of gains, people tend toward a risk aversion strategy
- when situations are framed in terms of loses, people tend toward a risk taking strategy
Justifications in decision making
Decision-making process includes looking for justification so a rationale is presented with decision
Exam and vacation decision. No difference between failing test and passing-both give justification for a vacation. However, if test results aren’t available for two days the majority of people will keep their option to buy vacation later open (don’t have the rational yet)
Neuroeconomics
One finding: decisions are influenced by emotions, and those emotions are associated with activity in specific areas of the brain
Sanfey and coworkers
- ultimatum game
- often rejected low offers because they became angry that offers were unfair
- less angry with an unfair computer
- more activation of the right anterior insula (connected with emotional states), participants more likely to reject more offers
- about same for PFC (associated with cognition, decision making)
People not only consider gain but they also consider fairness of emotions
The dual systems approach to thinking
Kahneman
System 1: fast, automatic, intuitive, non conscious
System 2: slower, deliberative, conscious,controlled
- Much of our day to day existence is handled by system 1
- System 2 takes over when we need to be more thoughtful
Stanovich and West
- favour terms “type 1 processing” and “type 2 processing”
- similar characteristics as Kahnemans system 1 and 2 concept
- favoured by many researchers because better reflects the interconnected, distributed processing that occurs in the brain (not as two separate systems)
