Decision-making

Question 1

What is the cognitive ritual which helps us make good decisions?

Answer 1

1. Consider the possibilities
2. Evaluate them based on some goal
3. Gather evidence to determine the extent to which a possibility meets our goals
4. Then, using evidence, each possibility is strengthened or weakened as a choice, in light of our goals

Question 2

What does the current decision-making literature say?

Answer 2

Gifted = better decision making
Low intelligence = poor/limited decision making
Average intelligence = unclear

Low correlations between decision making ability and intelligence tests

In a dynamic systems (microworlds) experiment, fluid intelligence correlated with composite scores of less complex scenarios. Perhaps decision-making must be understood as a more complex behaviour??

Question 3

What is rationality?

Answer 3

Rationality is reasoning by a process of logic (impersonal)

Rationality is reasoning in such a way as to achieve one’s goals within cognitive restraints e.g., expected utility theory (personal)

Question 4

What are the two decision making processes?

Answer 4

Automatic: fast, effortless, associative and unconscious
Reflective: controlled, effortful, deductive, and self-aware –> used in novel situations

Question 5

What are heuristics and biases?

Answer 5

People seem to largely violate normative models in practice
Heuristics are mental shortcuts that we use when there is too much info and not enough time
We can arrive at a satisfactory rather than an optimal solution (bounded rationality)
Can result in cognitive biases (representative heuristic, confirmation bias)