Judgment under Uncertainty: Heuristics and Biases

These flashcards cover key concepts from the lecture on heuristics and biases in judgment and decision-making.

Heuristics

Mental shortcuts or rules of thumb that simplify decision-making processes.

Biases

Systematic errors in thinking that affect judgments and decisions.

Representativeness heuristic

A cognitive bias where people evaluate probabilities based on the similarity of objects or events.

Availability heuristic

A mental shortcut used to assess frequency or probability based on how easily examples come to mind.

Anchoring

The cognitive bias whereby an individual relies too heavily on the first piece of information encountered when making decisions.

Insensitivity to prior probability

A tendency to ignore the base-rate frequency of outcomes when making probabilistic judgments.

Regression toward the mean

The phenomenon whereby extreme outcomes are followed by more moderate ones.

Misconceptions of chance

Incorrect beliefs about randomness, including the gambler's fallacy.

Illusory correlation

The false perception of a relationship between two variables when none exists.

Judgmental operations

Simplified processes that people use to assess probabilities and make predictions.

Sample size bias

The tendency to disregard the importance of sample size in statistical reasoning.

Conservatism

Underestimation of the impact of new evidence when re-evaluating probabilities or beliefs.