Reasoning & Decision Making

expected utility theory (EUT)

when people are faced with multiple options, they will choose the one that returns the highest likely value

Premises

a set of beliefs that guide how you think about or interpret something.

availability heuristic

a tendency to rely on information that quickly comes to mind when trying to make a decision.

Propositions

any statement that can be true or false

Deduction

a kind of reasoning process where the conclusion follows logically from the initial premises

Induction

a kind of reasoning which relies on generalizing from a certain set of information and extending it to make an informed guess.

Syllogism

a kind of reasoning in which a conclusion is derived from two or more propositional statements.

categorical syllogism

consists of three statements: two premises and one conclusion.

Fallacies

invalid syllogisms

belief bias

a tendency to rate conclusions that are more believable as more valid.

atmosphere effect

which occurs when people rate a conclusion as valid as long as the qualifying words (e.g., "all," "some") in the premises match those in the conclusion

mental models

 a kind of mental simulation of the world

conditional/hypothetical syllogism

a kind of syllogism that states a rule that relates two propositions 

modus ponens/affirming the antecedent

the antecedent is true, we can conclude that the consequent is true

modus tollens/denying the consequent

the consequent is false and conclude that the antecedent must be false as well

denying the antecedent

when we conclude the consequent is false because the antecedent is false.

affirming the consequent

when we conclude the antecedent is true because the consequent is true. 

Statistical syllogism

which we go from observations about a group to an inference about an individual

one-shot learning

 in which a concept is learned from a single example.

Bayesian inference

 educated guess

availability heuristic

 a tendency to rely on information that quickly comes to mind when trying to make a decision.

affect heuristic

the tendency for people to overestimate the risk of events that generate a strong emotional reaction, such as dread

 Anchoring

 the tendency for people to focus and rely on initial pieces of information

 representativeness heuristic

 to rely on the fact that a person or object they are trying to make a decision about conforms to a specific category

conjunction fallacy

people assume that two specific conditions are more probable than a single, encompassing condition

base-rate fallacy

people ignore the underlying probability of an event in favor of some present evidence

loss aversion

prefer to avoid losing something as compared with not gaining something of equal value. 

endowment effect

people place a higher value on objects they already own over those that they don't yet own.

 Ikea effect 

A tendency for people to place a higher value on objects they built themselves vs those that others built 

status quo bias

a tendency to leave things as they currently are, rather than making a change.

Integral emotions

emotions are those that are directly related to the decision

Incidental emotions

emotions that are not directly related to the decision but that happen to be the state of the person at the time they are making the decision.

 Ultimatum Game

An experimental paradigm in which two people, a proposer and responder, split a pot of money

nudge theory

 encourage people to make certain behavioral choices by introducing small changes to the environment.