Chapter 7 - FPDM

Question 1

3 Assumptions of Rational Decision-Making

Answer 1

People are:

1. Logical and discriminating (ranked preferences in terms of outcomes)
2. Open to new evidence (updating new information)
3. Coherent and consistent in responding to logical arguments

Question 2

Three Assumptions of Subjective Probability Estimates

Answer 2

People are:

1. Generating subjective estimates of the consequences of their options (based on past experience and rough calculations)
2. Updating estimates with new evidence
3. Maximizing their subjective expected utility

Question 3

Two Challenges to Rational Actor Model

Answer 3

1. Cannot explain beliefs or expectations that lead to choice
2. Little insight into FPDM

Question 4

Four Psychological Limitations of Rational Choice

Answer 4

1. Preference for Simplicity
2. Cognitive Consistency
3. Poor estimators - use of heuristics
4. Loss aversion: loss overvalued over gain

Question 5

Preference for Simplicity - Cause, Example, and Consequence

Answer 5

Cause: demands of political communications / narratives
Example: Use of frames
Consequence: Limited policy options

Question 6

Poor Estimators and the Use of Heuristics - Definition, Examples

Answer 6

Definition: Rules DMs use to process information. Often simplifies problems to come up with an answer given few resources/time.
Examples: Availability bias, representativeness, anchoring, fundamental attribution error / essentializing people.

Question 7

Neuroscience and DM

Answer 7

Suggests most decisions are not deliberative thought processes
Instead they are preconscious neurological processes and strong emotional responses

Question 8

Underpins FPA’s FPDM Approach

Answer 8

Reflective, deliberative, rational decision-making

Question 9

Fear causes ___________ in FPDM

Answer 9

Uncertainty and loss aversion

Question 10

Anger causes ___________ in FPDM

Answer 10

Certainty and risk acceptance

Question 11

6 Points on Rational Actor Model

ABCDET

Answer 11

It’s useful when it’s…

1. Seen aspirationally
2. Correcting some of the worst biases in DM
3. Understood to contain counter-intuitive positions
4. Considered with the many dynamics of choice
5. Considering how and when emotions are engaged
6. Working in tandem with other approaches