PSYCH 207 - Module 11 Decision Making

What is decision making?

A cognitive process involving choices under conflict and uncertainty, often requiring probabilistic reasoning.

What are the two main sources of difficulty in decision making?

Conflict (trade-offs between factors) and uncertainty (outcomes unpredictable or unknown).

What is conflict in decision making?

When decisions involve weighing competing factors (e.g., price vs features when buying a car).

What is uncertainty in decision making?

When outcomes depend on unpredictable variables (e.g., whether a stock will rise or fall).

Why do researchers study probabilistic reasoning in decision making?

Because many decisions involve unknown probabilities, requiring probability judgments.

How is rationality defined in decision making research?

Judging probabilities using objective rules and not letting beliefs or expectations bias decisions.

Name an applied setting where decision making is frequently studied.

Business, medicine, law, military contexts (e.g., DRDC research on fatigue and decision making).

What are heuristics?

Mental shortcuts that speed up decision making but can lead to systematic errors or biases.

What six heuristics were discussed?

Availability, representativeness, anchoring, illusory correlation, confirmation bias, overconfidence.

What is the availability heuristic?

Judging probability based on how easily examples come to mind.

Why do people think "-ing" words are more common than words with "n" as the second-last letter?

Because "-ing" words are easier to recall, even though both categories overlap.

What is the representativeness heuristic?

Judging probability based on resemblance to a typical example rather than actual probability.

Why do people incorrectly choose "girl, boy, boy, girl, boy, girl" as more likely?

It appears more random, even though both birth sequences are equally likely.

What is the gambler's fallacy?

The false belief that independent events are influenced by previous outcomes.

What is the anchoring heuristic?

Relying too heavily on the first piece of information (the "anchor") when making estimates.

How did multiplication order demonstrate anchoring?

Starting with 8x7x6 produces higher estimates than starting with 1x2x3 because the initial values anchor judgments.

What is illusory correlation?

Perceiving a relationship that does NOT exist because it fits expectations.

What did the hair-twisting/stress example show?

People assumed a relationship because they expected stressed people to twist hair—even though the numbers did NOT support it.

What is confirmation bias?

Seeking or noticing information that confirms one's existing beliefs while ignoring conflicting evidence.

How does the 2-4-6 task illustrate confirmation bias?

Participants test only triplets that confirm their hypothesis rather than trying to disconfirm it.

What is overconfidence?

When people's confidence in their accuracy exceeds their actual performance.

What does the confidence-accuracy calibration graph show?

People are typically more confident than correct—consistent overconfidence.

What is expected utility theory?

A normative (idealized) model stating that people choose the option with the highest expected utility.

Why do researchers use "expected utility" rather than "expected value"?

Utility includes non-monetary outcomes like happiness, satisfaction, and personal goals.

How is expected utility calculated?

Sum of (probability of outcome × utility of outcome) across all outcomes.

What is a major criticism of expected utility theory?

People rarely make decisions by calculating utilities mathematically.

What is image theory?

A descriptive model where people eliminate incompatible choices before evaluating in detail.

What are the three "images" used in image theory?

Value image - morals, principles

Trajectory image - future goals

Strategic image - plans for achieving goals

How does image theory reduce cognitive load?

By quickly removing options that conflict with values/goals before deep evaluation.

What is recognition-primed decision making?

Experts use intuition, pattern recognition, and experience-based analogies rather than deliberate calculation.

When is recognition-primed decision making most effective?

In domains where the decision maker has extensive prior experience.

What risk is associated with recognition-based decisions?

Biases and incorrect assumptions can mislead decisions (e.g., faulty analo)

What field studies how the brain supports decision making in real-world environments?

Neuroeconomics

Why is emotion important in decision making?

Emotional responses influence choices, sometimes overpowering rational calculations.

Which brain region is essential in decision making?

The prefrontal cortex (PFC).

What did the ultimatum game reveal?

People often reject unfair offers even when it means losing money—emotion overrides rationality.

What brain areas activated during rejection of unfair offers?

Insula (negative emotions like disgust/anger)

Dorsolateral prefrontal cortex (cognitive control)

What does activation in the insula indicate?

Emotional aversion driving decision outcomes.

What other brain regions are involved in decision making?

Anterior cingulate cortex (ACC): conflict monitoring

Amygdala: emotional processing