Lecture 3 - Heuristics Flashcards
What are heuristics?
Mental shortcuts, rules of thumb, cognitive biases
Weighted additive rule
Everything we need to make a fully informed decision:
1. Identify all relevant information
2. Recall and store this information
3. Assessing weights of all information
4. Consider all information on alternatives
5. Select the right option
Why use heuristics?
The weighted additive rule costs a lot of effort and is not always possible. Therefore heuristics can be used to lessen this effort.
Reverse of the weighted additive rule
- Examine less information
- Make recall and store easier
- Simplify weighting of all information
- Consider less information on alternatives
- Select from fewer options
Similarities between weighted additive rule and heuristics
- Both are decision rules
- Both are rules that can be compared.
Attribute substitution
A phenomenon in which people substitute a complex problem with a more simple one, without being aware of it.
Example of attribute substitution
In a job interview setting, a hiring manager might be asked to assess a candidate’s overall competence. This is a complex evaluation, but the manager may unknowingly substitute that judgment with something easier to assess, like how confident or articulate the candidate appears during the interview. The manager may then perceive a confident candidate as more competent, even though confidence isn’t a direct measure of competence.
Effort-accuracy trade-off
Selecting the best decision strategy given the amount of effort available, at the cost of accuracy.
When does less effort not lead to less accuracy?
Less-is-more effects: medical decision trees can be very useful to ask certain questions in case of emergency
What is an alternative for the effort-accuracy trade-off?
Ecological rationality
Ecological rationality
Selecting the best decision strategy given the environment
Representativeness heuristic
Using stereotypes and prototypes for decision-making in stead of actual base rates and probabilities.
Example of representativeness heuristic
In Peter’s class 20% play chess and 80% play soccer. Peter wears glasses and likes to read books, how likely do you think Peter is one of the chess players?
Availability heuristic
People make decisions based on how easily things come to mind. Ignoring the actual probability of something happening.
What makes something more salient/retrievable?
- Recent
- Familiar
- Personal
- Important
Example availability heuristic
Travel insurance
a) How much would you pay for an insurance that
returns $100.000 if you die abroad
b) How much would you pay for an insurance that
returns $100.000 if you die in a terrorist incident
abroad
People were willing to pay more for option B!
Anchoring heuristic
Tendency to rely heavily on the first piece of information you receive on a topic. Regardless of the accuracy of that information, people use it as a reference point or anchor
What is anchoring heuristic related to?
Framing
Social proof (heuristic)
Tendency to conform our behavior to what others do
Difference social norm and social proof
Social norm: what the majority perceives as the norm.
Social proof: what the majority does.
Descriptive norms
What you think the majority does.
Injunctive norms
About what you think the majority thinks you should do.
Example of social proof
In an experiment, at a bakery there were easter eggs that clients could get. It showed that when there was an empty wrapper lying around people were more likely to grab an egg.
Bias blindspot
People tend to think that biases are much more prevalent in others than in themselves
