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ABSTRACT Choice blindness is the finding that participants both often fail to notice mismatches between their decisions and the outcome of their choice and, in addition, endorse the opposite of their chosen alternative. But do these preference reversals also carry over to future choices and ratings? To investigate this question, we gave participants the task of choosing which of a pair of faces they found most attractive. Unknown to them, we sometimes used a card trick to exchange one face for the other. Both decision theory and common sense strongly suggest that most people would easily notice such a radical change in the outcome of a choice. But that was not the case: no more than a third of the exchanges were detected by the participants. We also included a second round of choices using the same face pairs, and two stages of post-choice attractiveness ratings of the faces. This way we were able to measure preference strength both as choice consistency and by looking at measures of rating differences between chosen and rejected options. We found that the initially rejected faces were chosen more frequently in the second choice, and the perceived attractiveness of these faces was increased even in uncoupled individual ratings at the end of the experiment. This result is discussed in relation to Chen and Risen's recent criticism of the Free Choice Paradigm, as it shows that choices can affect future preferences. Copyright © 2013 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Abstract: This paper presents a simple formal analytical model delivering qualitative predictions for response times in binary‐choice experiments. It combines a dual‐process/multi‐strategy approach with the standard diffusion model, modeling a utility decision process and a heuristic decision process as diffusion processes of evidence accumulation. For experiments with objective alternatives (including many tasks in judgment and decision making), the model predicts that errors will be quicker than correct responses in case of process conflict and slower in case of alignment, capturing a well‐documented asymmetry regarding slow or fast errors. Further, the model also predicts that correct responses are slower in case of conflict than in case of alignment, capturing the well‐known Stroop effect. The model is also extended to cover experiments with subjective alternative evaluations, that is, preferential choice. In this case, results depend on whether trials are hard or easy, that is, on whether the heuristic can be interpreted as relatively automatic or not. Copyright © 2016 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

The seven papers in this special issue represent the breadth and complexity of approaches to the study of affect in judgment and decision processes. Four papers examine the role of arousal or specific emotions in decision making. The three other papers investigate the impacts of uncertainty, time course, and thinking about mood. We briefly describe four functions of affect in decision making (affect as information, as a spotlight, as a motivator, and as common currency) and relate them to the seven special-issue papers. The role of affect in decisions and decision processes is quite nuanced and deserves careful empirical study in basic and applied research. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper attacks one of the chief limitations of the field of behavioral decision research—the past inability to use this literature to improve decision making. Building on the work of Thompson, Gentner, Loewenstein and colleagues (Loewenstein, Thompson, & Gentner, 1999; Thompson, Gentner, & Loewenstein, 2000; Gentner & Markman, 1997), the current paper finds that it is possible to reduce bias in one of the most robust problems in the decision literature, the Acquiring a Company Problem (Samuelson & Bazerman, 1985). Past research has shown that individuals make suboptimal offers as a result of the failure to think about the decisions of others and to incorporate a clear understanding of the rules of the game. In the current study, we find that by allowing study participants to see and understand differences in seemingly unrelated decision problems—versions of the Monty Hall Game (Nalebuff, 1987; Friedman, 1998) and Multiparty Ultimatum Game (Messick, Moore, & Bazerman, 1997; Tor & Bazerman, 2003)—study participants can learn to focus more accurately on the decisions of other parties and the rules of the game, the keys to solving the Acquiring a Company Problem. This research offers a new piece of evidence that comparative and analogical processes may be a successful direction for improving decision making. Copyright © 2004 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

In this paper we examined the impact of a specific emotion, guilt, on focusing in decision-making. Through the focusing mechanism, when making decisions, individuals tend to restrict their thoughts to what is explicitly represented in the decisional task, disregarding alternatives. In this paper, three experiments are performed to investigate whether an emotional state of guilt can critically guide individuals' focusing, and even prevailing over the focusing mechanism. Guilty emotional state was induced by asking participants to write about a guilty related life event. The emotional state was thus neither generated by nor related to the tasks used in the experiments. Results of the first two studies show that guilt affects focusing in decision-making in the case of only one explicitly specified option (a positive or a negative one). Guilty participants, when presented with a stated option that has predominantly positive characteristics, prefer other, unspecified options over the positive one. Guilty participants faced with a stated option that has predominantly negative features tend to prefer it to other, unspecified, options, instead. Finally, experiment 3 shows that guilty participants presented with two different options (a negative vs. a positive one) having different degrees of explicitness (i.e. they are not equally represented in the decision frame), focus on the negative option, even though the latter was not explicitly represented but only hinted at the end of the text. Overall, these results suggest that guilt emotion state can play a crucial role in either strengthening or reducing the focusing mechanism. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Foregone payoffs add information about the outcomes for alternatives that are not chosen. The present paper examines the effect of foregone payoffs on underweighting rare but possible events in repeated choice tasks. Previous studies have not demonstrated any long-lasting effects of foregone payoffs (following repeated presentation of a task) when foregone payoffs do not add much information. The present paper highlights the conditions and the contributing factors for the occurrence of such long-lasting effects. An experimental study compares the effect of foregone payoffs under different degrees of rarity of the negative payoff. It is demonstrated that foregone payoffs increase the selection from risky alternatives with extremely rare and highly negative outcomes, and that this effect does not diminish with repeated presentation of the task. These findings can be summarized using a surprisingly simple reinforcement-learning model. The findings are discussed in the context of the potential long-term effect of social learning. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

ABSTRACT Rubinstein and Leland have both demonstrated that many observed violations of expected and discounted utility can be explained if people employ similarity judgments to make choices. In this paper, I show that this decision process also explains which equilibria will be selected in single-shot games with multiple equilibria and implies that play in games will be associated with anomalies in risky choice. Data supporting these predictions are presented. Copyright © 2012 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Presents a response to commentaries on an article which offered a defense for independence axiom in decision making. Value of information; Choice and preferences in non-information-aversion.

Standard choice theory assumes choice to be independent of the point of reference. Based on a number of studies which challenge this assumption. Tversky and Kahneman have proposed a reference-dependent model which captures the influence of reference points on individual choice. If choice is reference-dependent, switching the reference point so that it is first dominated by x and then by y increases the likelihood of choosing y. Switching the location of an asymmetrically dominated reference point without altering the dominance relationship should also influence reference-dependent choice in a predicted manner. In this paper the reference-dependent model is tested in two experiments which focus on asymmetrically dominated reference points. The results of these experiments give further confirmation to the reference-dependent model. [ABSTRACT FROM AUTHOR]

Identifying discrepancies between normative prescriptions and actual behavior constitutes an important facet of studying judgment and decision making. Notwithstanding, alleged normative violations should be submitted to the most stringent tests before their existence is recognized. The present paper centers on participants' understanding of instructions and comprehension of the experimental task. As an example, we examine the “uncertainty effect” which, supposedly, violates canonical requirements of the theory of rational choice. Following this effect, people often value a lottery less than its worst possible realization, due to the uncertainty associated with the lottery. We empirically demonstrate that Gneezy et al.'s instructions were ambiguous. We show that only participants who miscomprehended the instructions exhibited a response pattern consistent with the uncertainty effect. Removing the ambiguity results in the elimination of the effect. Broader implications for the judgment and decision making literature are briefly discussed. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Although prior studies have found that people generally underweight advice from others, such discounting of advice is not universal. Two studies examined the impact of task difficulty on the use of advice. In both studies, the strategy participants used to weigh advice varied with task difficulty even when it should not have. In particular, the results show that people tend to overweight advice on difficult tasks and underweight advice on easy tasks. This pattern held regardless of whether advice was automatically provided or whether people had to seek it out. The paper discusses implications for the circumstances under which people will be open to influence by advisors. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper reviews the impact of anger on judgment and decision making. Section I proposes that anger merits special attention in the study of judgment and decision making because the effects of anger often diverge from those of other negative emotions. Section II presents an Appraisal-Tendency Framework for predicting and organizing such effects. Section III reviews empirical evidence for the uniqueness of anger's relations to judgment and decision making. Section IV connects the Appraisal-Tendency Framework to associated mechanisms and theories. Drawing on the evidence, Section V presents the question of whether anger should be considered a positive emotion. It also proposes the hypothesis that anger will be experienced as relatively unpleasant and unrewarding when reflecting back on the source of one's anger but experienced as relatively pleasant and rewarding when looking forward. Section VI synthesizes the evidence into a new portrait of the angry decision maker. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper examines the occurrence of framing effects when more thought is given to problems. In Study 1, participants were presented with one of two frames of several decision problems. Participants' Need for Cognition (NC) scores were obtained, and half the participants were asked to justify their choices. Substantial framing effects were observed, but the amount of thought purportedly given to a problem, whether manipulated by justification elicitation or measured by NC scores, did not reduce the incidence of framing effects. In Study 2, participants responded to both frames of problems in a within-subjects design. Again, NC scores were unrelated to responses on the first frame encountered. However, high-NC, compared to low-NC, participants were more consistent across frames of a problem. More thought, as indexed here, does not reduce the proclivity to be framed, but does promote adherence to normative principles when the applicability of those principles is detectable. Copyright © 2003 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper examines the role of computer-based decision aids in reducing cognitive effort and therefore influencing strategy selection. It extends and complements the work reported in the behavioral decision theory literature on the role of effort and accuracy in choice tasks. The central proposition of the research is that if a decision aid makes a strategy that should lead to a more accurate outcome at least as easy to employ as a simpler, but less accurate, heuristic, then the use of a decision aid should induce that more accurate strategy and as a consequence improve decision quality. Otherwise, a decision aid may only influence decision-making efficiency. This occurs because decision makers use a decision aid in such a way as to minimize their overall level of effort expenditure. Results from a laboratory experiment support this proposition. When a more accurate normative strategy is made less effortful to use, it is used. This result is consistent with the findings of our prior studies, but more clearly demonstrates that decision aids can induce the use of normatively oriented strategies. The key to inducing these strategies is to make the normative strategy easier to execute than competing alternative strategies. [ABSTRACT FROM AUTHOR]

The challenge in inferring cognitive processes from observational data is to correctly align overt behavior with its covert cognitive process. To improve our understanding of this overt-covert mapping in the domain of decision making, we collected eye-movement data during decisions between gamble-problems. Participants were either free to choose or instructed to use a specific choice strategy (maximizing expected value or a choice heuristic). We found large differences in looking patterns between free and instructed choices. Looking patterns provided no support for the common assumption that attention is equally distributed between outcomes and probabilities, even when participants were instructed to maximize expected value. Eye-movement data are to some extent ambiguous with respect to underlying cognitive processes. Copyright © 2017 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

In two experiments, we demonstrate that despite indicating indifference when probed about risk or delay in isolation, when forced to explicitly trade-off between the two, participants prefer delayed over risky rewards. This pattern of findings sets a boundary condition for any common utility-based comparison process involving both risk and delay. Furthermore, this change from indifference-in-isolation to delay-preference-in-a-trade-off strengthens as reward amount increases. Exploratory modeling results suggest that the shift in preference can be explained by allowing for different discount rates for delay-only choices compared with when delay is in competition with risk. This explanation is better than one in which probability weighting is different between risk-only choices and risks considered in the presence of a delay. Together, the empirical and modeling work lays a path for future investigations of why and when people's evaluation of the properties of risky and delayed choices vary as a function of the alternatives on offer. Copyright © 2017 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

The attraction effect shows that adding a third alternative to a choice set can alter preference between the original two options. For over 30 years, this simple demonstration of context dependence has been taken as strong evidence against a class of parsimonious value-maximising models that evaluate alternatives independently from one another. Significantly, however, in previous demonstrations of the attraction effect alternatives are approximately equally valuable, so there was little consequence to the decision maker irrespective of which alternative was selected. Here we vary the difference in expected value between alternatives and provide the first demonstration that, although extinguished with large differences, this theoretically important effect persists when choice between alternatives has a consequence. We use this result to clarify the implications of the attraction effect, arguing that although it robustly violates the assumptions of value-maximising models, it does not eliminate the possibility that human decision making is optimal. © 2016 The Authors Journal of Behavioral Decision Making Published by John Wiley & Sons Ltd. [ABSTRACT FROM AUTHOR]

The paper examines preference reversal in equal-probability gambles, gambles in which all payoffs have the same probability. The results indicate that for attractive gambles (gambles whose payoffs are positive) there is a higher preference for high-variance gambles when preference is inferred from pricing and rating than when it is inferred from choice, while for unattractive gambles (gambles whose payoffs are negative) there is a higher preference for high-variance gambles when preference is inferred from choice than when it is inferred from pricing. The results also indicate that in pricing, but not in choice, there is a lower preference for high-variance gambles when the subject possesses the gamble than when he or she does not possess it. The implications of these effects for various explanations of preference reversal are discussed, and it is concluded that the effects can be explained by anchoring and adjustment, but not by compatibility, prominence, expression theory, or change of process theory. [ABSTRACT FROM AUTHOR]

This paper examines the presumptions behind, and methods within, two approaches toward the analysis of decision problems - Conflict Analysis and Strategic Choice. These offer complementary perspectives, based respectively on particular notions of conflict and uncertainty. It is suggested that these perspectives can usefully be combined in order to provide more effective ways of helping with complex decision problems, and some preliminary forms of decision model are proposed. [ABSTRACT FROM AUTHOR]

Recently, several theories of decision making and probability judgment have been proposed that take into account ambiguity (Einhorn and Hogarth, 1985; Gardenfors and Sahlin, 1982). However, none of these theories explains exactly what the psychological causes of ambiguity are or addresses the issue of whether ambiguity effects are rational. In this paper, we define ambiguity as the subjective experience of missing information relevant to a prediction. We show how this definition can explain why ambiguity affects decisions in the ways it does. We argue that there are a variety of rational reasons ambiguity affects probability judgments and choices in the ways it does. However, we argue that the ambiguity effect does not cast doubt on the claim that utility theory is a standard of rational choice. Rather, we suggest that the effect of ambiguity on decisions highlights the fact that utility theory, like any normative model of decision making only prescribes the optimal decision, given what one knows. [ABSTRACT FROM AUTHOR]

This study reports three experiments which demonstrate path dependency in risky intertemporal choice. Consider a lottery to be resolved and paid in a future time period. One can obtain the present value of this lottery in three different ways: (1) eliciting directly the present certainty equivalent (CE) of the future lottery (direct path); (2) eliciting the future CE and then discounting this amount to the present (risk-time path); and (3) eliciting the present value of the risky prospect and then determining the CE of this current lottery (time-risk path). Standard rational choice models such as the discounted expected utility model, assume a multiplicative model, where all three methods mentioned above would yield the same value. We conducted three studies to examine if this is the case: Experiments 1 and 2 were based on a set of matching-task questions and Experiment 3 used a process-tracing design to analyze the natural sequence of decision making by the subjects. These three studies show that the evaluation of future gambles is path-dependent. The present values elicited under the time-risk and direct paths are, on average, higher than those reported under the risk-time path. In addition, we found evidence for a two-stage evaluation of risky future prospects: When evaluating a future gamble, individuals first assess the present value of the gamble (time discounting) and then they determine a certainty equivalent (probability discounting). Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

A phantom decoy is an alternative that is superior to another "target" option but is unavailable at the time of choice. In value-based decisions involving phantom decoys (e.g., consumer choices), individuals often show increased preference for the similar, inferior target option over a non-dominated competitor alternative. Unlike value-based decisions that are driven by subjective goals, perceptual decisions typically have an outside criterion that defines the goal of the task (e.g., target is present or absent). Despite their obvious differences, past research has documented a number of commonalities between both types of decisions. In a set of three experiments, we examine the influence of phantom options on simple perceptual decisions and point out a critical difference between perceptual and value-based decisions. Our results show that in perceptual choice, participants prefer competitor options to target options, the opposite of the pattern typically found in consumer choice. We use the results of the experiments to examine the predictions of four different models of context effects including loss aversion and dynamic, preference accumulation models. We find that accumulation models provide the best explanation for our results as well as being able to generalize to other context effects. [ABSTRACT FROM AUTHOR]

To measure a person's risk-taking tendency, research has relied interchangeably on self-report scales (e.g., "Indicate your likelihood of engaging in the risky behavior") and more direct measures, such as behavioral tasks (e.g., "Do you accept or reject the risky option?"). It is currently unclear, however, how the two approaches map upon each other. We examined the relationship between self-report likelihood ratings for risky choice in a monetary gamble task and actual choice, and tested how the relationship is affected by task ambiguity (i.e., when part of the information about risks and benefits is missing) and age. Five hundred participants (aged 19-85 years) were presented with 27 gambles, either in an unambiguous or an ambiguous condition. In a likelihood rating task, participants rated for each gamble the likelihood that they would accept it. In a separate choice task, they were asked to either accept or reject each gamble. Analyses using a signal-detection approach showed that people's likelihood ratings discriminated between accept and reject cases in their choices rather well. However, task ambiguity weakened the association between likelihood ratings and choice. Further, older adults' likelihood ratings anticipated their choices more poorly than younger adults'.We discuss implications of these findings for existing approaches to the study of risk-taking propensity, which have often relied on self-reported risk tendency for ambiguous activities. [ABSTRACT FROM AUTHOR]

In mixed-motive interactions, defection is the rational and common response to the defection of others. In some cases, however, group members not only cooperate in the face of defection but also compensate for the shortfalls caused by others' defection. In one field and two lab studies, we examined when group members were willing to compensate for versus match defection using sequential dilemmas. We found that the level of identification with the broader group increased willingness to compensate for intragroup defection, even when it was personally costly. Compensating for a defecting partner's actions, however, is not an act of unconditional cooperation: It is accompanied by a lack of trust in the errant group member and a desire to be perceived as more ethical. Cooperation by others, on the other hand, is matched independent of whether the cooperator was an in-group or out-group member. We find similar patterns of compensation and matching when the personal cost involved contributing money or effort. Copyright © 2015 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We present a taxonomy of choice architecture techniques that focus on intervention design, as opposed to the underlying cognitive processes that make an intervention work. We argue that this distinction will facilitate further empirical testing and will assist practitioners in designing interventions. The framework is inductively derived from empirically tested examples of choice architecture and consists of nine techniques targeting decision information, decision structure, and decision assistance. An inter-rater reliability test demonstrates that these techniques can be used in an intersubjectively replicable way to describe sample choice architectures. We conclude by discussing limitations of the framework and key issues concerning the use of the techniques in the development of new choice architectures. Copyright © 2015 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Individuals often make decisions that affect groups, yet the propensities of group representatives are not as well understood than those of independent decision makers or deliberating groups. We ask how responsibility for group payoffs-in the absence of group deliberation-affects the choice. The experiment utilizes the Interdependent Security Dilemma paradigm. In its deterministic version, the game is identical to a finitely repeated Prisoner's Dilemma. In the stochastic version, potential losses are larger but uncertain, occurring with a predefined probability when one or both players choose to forgo investment in protection. Participants were assigned to play either as individuals, or as representatives of three-person groups, with each member's choices equally likely to determine the group's payoffs. In the deterministic condition, individuals were more likely to invest (cooperate) than group representatives (80% vs. 62% of rounds). In the stochastic condition, the pattern was reversed as representatives were slightly, but not significantly, more likely to invest than individuals (46% vs. 40%). The significant interaction effect suggested that group representatives were not only less cooperative but also more risk averse than individuals. A follow-up study supported this account by showing participants who construed the invest strategy as low-risk than those who perceived this strategy to be high risk. Overall, group representatives exhibited a tendency to act more competitively and more cautiously than individuals acting alone. Copyright © 2015 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Previous studies explain loss aversion as the result of a situation in which the expected negative emotions derived from a potential loss exceed the expected positive emotions derived from a potential gain (subtractive logic). We questioned this view and proposed additive logic, in which a linear combination between negative and positive emotions can be used as summed anticipatory affect intensity (SAAI) to explain loss aversion. By disproving two implicit hypotheses of subtractive logic, Study 1 showed that the additive logic of expected positive and negative affect was more effective than the subtractive logic in predicting loss aversion. Study 2 used real monetary gains and losses to verify the conclusion in Study 1. Using state-trait theory to comprehensively consider the state and trait aspects of affect intensity, we further deduced that the immediate expected affect intensity might originate from the difference of an individual trait in affect intensity. Study 3 proved this hypothesis and showed that SAAI plays an intermediary role between affect intensity and loss aversion. Furthermore, Study 4 used real gamblers in casinos in Macau as its sample and obtained the same conclusion regarding loss aversion in real life as was found in the laboratory. Finally, we explained the effect of SAAI on loss aversion and indicated the contribution and significance of this study. Copyright © 2015 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We asked participants to make simple risky choices while we recorded their eye movements. We built a complete statistical model of the eye movements and found very little systematic variation in eye movements over the time course of a choice or across the different choices. The only exceptions were finding more (of the same) eye movements when choice options were similar, and an emerging gaze bias in which people looked more at the gamble they ultimately chose. These findings are inconsistent with prospect theory, the priority heuristic, or decision field theory. However, the eye movements made during a choice have a large relationship with the final choice, and this is mostly independent from the contribution of the actual attribute values in the choice options. That is, eye movements tell us not just about the processing of attribute values but also are independently associated with choice. The pattern is simple-people choose the gamble they look at more often, independently of the actual numbers they see-and this pattern is simpler than predicted by decision field theory, decision by sampling, and the parallel constraint satisfaction model. © 2015 The Authors. Journal of Behavioral Decision Making published by John Wiley & Sons Ltd. [ABSTRACT FROM AUTHOR]

Introduces a series of articles on decision making.

We examined (1) whether people would be more responsive to the delayed consequences of their decisions when attempting to minimize losses than when attempting to maximize gains in a history-dependent decision-making task and (2) how trait self-control would moderate such an effect. In two experiments, participants performed a dynamic decision-making task where they chose one of two options on each trial. The increasing option always gave a smaller immediate reward but caused future rewards for both options to increase. The decreasing option always gave a larger immediate reward but caused future rewards for both options to decrease. In Experiment 1 where the two options had equivalent expected value in the long run, participants were more prone to select the increasing option, which yielded larger benefits on future trials, in the loss-minimization condition than in the gain-maximization condition. Trait self-control moderated the effect of losses by enhancing the effect for low self-control participants while attenuating it for high self-control participants. In Experiment 2 where selecting the increasing option was suboptimal, low self-control participants still attempted to reduce losses on future trials by selecting the increasing option more often than high self-control participants. These results suggest that decision makers value delayed consequences of their actions more in a losses domain relative to a gains domain and low self-control individuals are more susceptible to such an effect. Copyright © 2014 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Routines help individuals save decision effort and protect them from overreacting to volatile environments. Yet routines become dysfunctional if the environment changes fundamentally. Whether the environment has truly changed is often not easy to tell. We experimentally study adaptation to a change in a previously stable environment. Participants have to choose between one of the four decks of cards. Each deck represents a lottery, with a distribution of gains and losses initially unknown to participants. In the learning phase of the experiment, participants acquire the routine to choose the most attractive deck. Unbeknownst to participants, after an interruption, the lotteries represented by the competing decks are changed. We study how participants react to this change. We manipulate whether participants have access to choices by a confederate who most of the time makes the normative choice. In baseline condition, they never do. In the treatments, access is provided either during the learning phase, during the test phase, or during both phases. Participants are most likely to realize that the world has changed if they had access to the confederate's choices in both phases. [ABSTRACT FROM AUTHOR]

ABSTRACT Two methodological variants of Kahneman and Tversky's Asian disease scenario were investigated. One variant involved replacing the 'all-or-none' outcome scenarios of the risky choice with 'most-or-some' scenario outcomes, and the second variant involved replacing the negative domain of lives lost with a positive domain of jobs created. In addition, the effects of strength of handedness, a variable related to individual differences in risk perception, were examined. Results indicated that standard framing effects were obtained across both domains, with a decrease in risky choice under the gain domain. Scenario type also interacted with handedness, such that the all-or-none scenario yielded framing effects for consistent (strong)-handers only, whereas the most-or-some scenario yielded framing effects for inconsistent (mixed)-handers only (consistent-handers are those who use the same hand exclusively for almost all activities). These results demonstrate that framing effects are strongly influenced by the presence versus absence of extreme/absolute outcomes and that individuals (in this case, decision makers with varying degrees of handedness strength) are differentially sensitive to different pieces of information. Copyright © 2014 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

ABSTRACT What produces better judgments: deliberating or relying on intuition? Past research is inconclusive. We focus on the role of expertise to increase understanding of the effects of judgment mode. We propose a framework in which expertise depends on a person's experience with and knowledge about a domain. Individuals who are relatively experienced but have modest knowledge about the subject matter ('intermediates') are expected to suffer from deliberation and to benefit from a more intuitive approach, because they lack the formal knowledge to understand the reasons underlying their preferences. Individuals who are high ('experts') or low ('novices') on both experience and knowledge are expected to do well or poorly, respectively, regardless of decision mode. We tested these predictions in the domain of art. Experiments 1 and 2 showed that intermediates performed better when relying on intuition than after deliberation. Judgments of experts and novices were unaffected. In line with previous research relating processing style to judgment mode, Experiment 3 showed that the effect of processing style (global versus local) on judgment quality is similarly moderated by expertise. Copyright © 2012 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

ABSTRACT We experimentally analyzed decision procedures for dealing with a dynamic decision-making problem in which only qualitative information about the deterministic dynamics of the environment was available to participants. A participant's task was to maximize long-term profit in a computer-simulated monopoly market featuring delays and inertia. The design enabled a goal-system-based procedure, whereby a participant could select one or several short-term variables to be controlled (goal variables) and chose target values (aspiration levels) for each of them over a total of 50 periods. We report results based on a sample of 63 participants on the formation of goal systems and the process of aspiration adaptation. Our main findings are, first, that more frequently selecting goal systems that adequately reflect the causal structure of the underlying model is positively correlated with long-term profit; second, that goal persistence, a measure of a participant's tendency to stick to the current goal system, is positively correlated with long-term profit; and third, that aspiration levels tend to be adapted in strong agreement with certain basic principles of a benchmark model of aspiration adaptation. Our study thus suggests and provides empirical foundation for an approach to dealing with complex dynamic decision problems based on neither optimization nor learning. Copyright © 2011 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

ABSTRACT In decision making, people can focus on decisional outcomes (outcome focus), but they can also focus on gaining knowledge about the decisional domain (learning focus). Furthermore, people differ in the strength of their epistemic needs-their preference for developing a rich and accurate understanding of the world. We invoke the regulatory fit theory to predict that higher epistemic needs better fit a learning focus than lower epistemic needs, resulting in a greater increase in valuation of the chosen option when a learning rather than an outcome focus is induced. This general hypothesis was tested and supported in three studies, each focusing on a different proxy to epistemic needs. Thus, individuals experienced greater value when they had lower expertise (Study 1), higher need for assessment (Study 2), and higher need for cognition (Study 3) when a learning rather than an outcome focus was induced. Implications for work on epistemic needs, regulatory fit theory, and decision-making practice are discussed. Copyright © 2011 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Framing effects are said to indicate irrationality in decision making because they illustrate that linguistically different descriptions of equivalent options lead to inconsistent choices. A review of the literature on the effects of adding, or subtracting, implicated complements of the sure option shows that this leads to a classic framing effect, a reversal of the classic effect, or no framing effect. Thus, the assumption of equivalence of formulations is not justified. In addition we provide a test of two major, but opposing theories on framing, prospect theory and fuzzy-trace theory. Based on an online study we investigated the effects of subtracting complements of the risky option. The results are more consistent with fuzzy-trace theory than with prospect theory. The consequences of these findings for the application of formal models like prospect theory, and for rationality, are discussed. Copyright © 2009 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Goals are a ubiquitous part of life and have been shown to change behavior in many domains. This research studied the influence of goal attainment on risky choice behavior. Previous research has shown that goals tend to increase risk-seeking behavior when potential outcomes fall below a goal. We examined a new problem: Choice behavior when all potential outcomes in a choice set achieve or exceed the goal. Two studies show a “cushion effect” of goal attainment on choice under risk. When all possible outcomes of all options are above a salient and specific goal, decision makers are more likely to choose a risky option over a certain outcome with equal expected value (EV). We hypothesized that the attainment of a goal serves as a cushion that softens the negative emotions associated with receiving a gamble's low outcome. This allows risk taking that would otherwise be unattractive. Copyright © 2009 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Decision-makers often evaluate options sequentially due to constraints on attention, timing, or physical location of the options. Choosing the best option will therefore often depend on people's memories of the options. Because imperfect recall introduces uncertainty in earlier options, judgments of those options should regress toward the category mean as memory decays over time. Relatively desirable options will therefore tend to seem less desirable with time, and relatively undesirable options will tend to seem less undesirable with time. We therefore predicted that people will tend to select the first option in a set when choosing between generally undesirable options, and will tend to select the last when choosing between generally desirable options. We demonstrate these serial position effects in choices among paintings, American Idol audition clips, jellybeans, and female faces, provide evidence of its underlying mechanism, and explain how these findings build on existing accounts. Copyright © 2009 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We explored the potential for a sunk-cost effect in the realm of time. Questionnaire studies (Experiments 1–4) obtained a sunk-time effect that was robust to manipulations of prospective value, individual versus group consequences, and the effort or enjoyment inherent in the time. Behavioral experiments (Experiments 5–7) also suggested a sunk-time effect and found support for a personal responsibility by sunk-cost interaction on choice behavior. We discuss theoretical implications and a potential connection to animal sunk-cost phenomena. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

In four studies, student and nonstudent participants evaluated the possible outcomes of binary decisions involving health, safety, and environmental risks (e.g., whether to issue a dam-failure evacuation order). Many participants indicated that false positives (e.g., evacuation, but no dam failure) were better than true negatives (e.g., no evacuation and no dam failure), thereby implying that the more protective action dominated the less protective action. A common rationale for this response pattern was the precautionary maxim “better safe than sorry.” Participants apparently evaluated outcomes partly on the basis of the decisions that might lead to them, in conflict with consequentialist decision models. Consistent with this explanation, the prevalence of implied dominance decreased substantially when the emphasis on decisions was reduced. These results demonstrate that an initial preference for a decision alternative can alter the evaluation of possible consequences of both the preferred alternative and a competing alternative, suggesting positive feedback loops that reinforce the initial preference. The rationality of considering the decision itself as an attribute of possible outcomes is discussed. Copyright © 2009 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We show that preferences depend on the attributes that can be directly manipulated when people need to integrate multiple sources of information because direct manipulation causes focusing bias. This effect appears even when all relevant information is simultaneously and explicitly presented at the time the decisions are made. Participants decided how much to save, what investment risk to take and observed the future financial consequences in terms of the mean and variability of the expected retirement income. Participants who manipulated only the future income distribution saved more and took less risk. This effect disappears when the risk-related variables are removed, which indicates that task complexity is a mediator of such focusing effects. A more balanced trade-off between the choice attributes was selected when all attributes were manipulated. However, when there is a dichotomy between manipulating versus observing choice attributes, then decisions were based mostly on the manipulated attributes. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Inaction inertia is the effect that people do not act on an attractive opportunity only because they previously missed a more attractive opportunity. We investigated the effect of the presence of alternative options on the occurrence of this effect. We hypothesized and found that the likelihood to act on a current opportunity increases when evaluated in the context of another current option compared to when it is presented separately (Experiments 1 and 2). Likelihood of action decreases when the missed opportunity is presented next to another missed opportunity (Experiment 3). We conclude that when multiple options are currently present, the impact of the missed opportunity as a point of reference decreases, and that when multiple options are missed, the impact of these missed opportunities as a point of reference increases. These results are discussed in light of the literatures about inaction inertia and multiple options. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Three experiments are presented that explore the assertion that loss aversion and diminishing sensitivity drive the effect of experience on choice behavior. The experiments are focused on repeated choice tasks where decision makers choose repeatedly between alternatives and get feedback after each choice. Experiments 1a and 1b show that behavioral tendencies that were previously interpreted as indications of loss aversion in decisions from experience are better described as products of diminishing sensitivity to absolute payoffs. Experiment 2 highlights a nominal magnitude effect: A decrease in the magnitude of the nominal payoffs eliminates the evidence for diminishing sensitivity. These and related previous results can be captured with a model that assumes reliance on small samples of subjective experiences, and an increase in diminishing sensitivity with payoff variability. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Risky prospects come in different forms. Sometimes options are presented with convenient descriptions summarizing outcomes and their respective likelihoods. People can thus make decisions from description. In other cases people must call on their encounters with such prospects, making decisions from experience. Recent studies report a systematic and large description–experience gap. One key determinant of this gap is people's tendency to rely on small samples resulting in substantial sampling error. Here we examine whether this gap exists even when people draw on large samples. Although smaller, the gap persists. We use the choices of the present and previous studies to test a large set of candidate strategies that model decisions from experience, including 12 heuristics, two associative-learning models and the two-stage model of cumulative prospect theory. This model analysis suggests—as one explanation for the remaining description–experience gap in large samples—that people treat probabilities differently in both types of decisions. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This study investigates the influence of a decision aid on decision makers' model-based choices, emotions during the use of the model, and attitudes towards the model. A time allocation decision model was biased to purposefully provide optimistic or pessimistic criterion levels, on which subjects based their allocations. The results of our experiment indicate that the degree of “optimism” and “pessimism” inherent in the decision model had a significant impact on the decision maker's choices of criterion values, with optimism leading to higher criterion level choices and pessimism to lower levels. Furthermore, compared to pessimistic models, optimistic models significantly improved the decision makers' emotional states and, to some degree, their attitudes towards the decision aid. The implications of these conscious and sub-conscious influences on decision makers' choices, emotions, and attitudes are discussed and the need for model-builders and users to be aware of them is highlighted. Copyright © 2007 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

The winner's curse phenomenon refers to the fact that the winner in a common value auction, in order to actually win the auction, is likely to have overestimated the item's value and consequently is likely to gain less than expected and may even lose (i.e., it is said to be “cursed”). Past research, using the “Acquiring a company” task has shown that people do not overcome this bias even after they receive extensive feedback. We suggest that the persistence of the winner's curse is due to a combination of two factors: variability in the environment that leads to ambiguous feedback (i.e., choices and outcomes are only partially correlated) and the tendency of decision makers to learn adaptively. We show in an experiment that by reducing the variance in the feedback, performance can be significantly improved. Copyright © 2007 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Comments on the article "Do Medical Decisions Analyses' Largest Gains Grow From the Smallest Trees?" by Peter E. Politser in a 1991 issue. Interpretation of experimental results; Suggestions on research design; Personal view on the relative merits of simplicity and complexity.

We study a class of sequential selection and assignment problems in which a decision maker (DM) must sequentially assign applicants to positions with the objective of minimizing expected cost. In modeling this class of problems, we assume that on each period the DM is only informed of the rank of the present applicant relative to the applicants that she previously observed and assigned. We first present the optimal decision policy that we subsequently use as a normative benchmark, and then report results from three experiments designed to study sequential assignment behavior. In comparing the aggregate results from all three experiments to the optimal decision policy, we identify a systematic bias, called the middleness bias, to over-assign applicants to intermediate positions. The results also reveal a strong bias for early applicants to be over-assigned to important positions. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

The recognition heuristic postulates that individuals should choose a recognized object more often than an unrecognized one whenever recognition is related to the criterion. This behavior has been described as a one-cue, noncompensatory decision-making strategy. This claim and other assumptions were tested in four experiments using paired-comparison tasks with cities and other geographical objects. The main results were (1) that the recognized object was chosen more often than the unrecognized one when the recognition cue was valid; (2) that participants' behavior did not reflect the recognition validity of their own knowledge; (3) that a less-is-more effect (i.e., better performance with less knowledge) was either absent or of only small size; and (4) that judgments were influenced by further knowledge, which could even compensate for the recognition cue. In sum, the recognition cue represents an important piece of knowledge in paired comparisons, but apparently not the only one. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Four studies examined the impact that thinking about mood can have on people's choices. In Study 1, participants who were asked to suppose they were in good, bad, or neutral moods were more likely to choose a silly comedic movie over an otherwise more attractive drama, compared to others who had not thought about mood. Similar patterns were observed when people introspected about how they felt before making a hypothetical choice (Study 2) or an actual choice (Study 3). In Study 4, participants who pursued mood-relevant information chose to see a comedic play more often than those who had not focused on such information. Thinking about their own mood appears to increase decision makers' concern with the hedonic consequences of decisions, thereby promoting mood regulatory activities and altering preference, possibly in favor of suboptimal outcomes. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]