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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]

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]

This paper discusses differences between prospect theory and cumulative prospect theory. It shows that cumulative prospect theory is not merely a formal correction of some theoretical problems in prospect theory, but it also gives different predictions. Some experiments by Lola Lopes are re-analyzed, and are demonstrated to favor cumulative prospect theory over prospect theory. It turns out that the mathematical form of cumulative prospect theory is well suited for modeling the psychological phenomenon of diminishing sensitivity. [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]

We document an apparently widespread violation of dominance in the horse-racing betting market in the UK, and use the systematic variation in the incidence of this violation to estimate the consumption value of gambling. Betting-shop gamblers in the UK face a tax on gambling of 10%, but have the choice of paying the tax either at the time of wager or on any return on a successful bet. It can be shown, however, that the latter act is strictly dominated by another action in which tax is paid on the wager. Despite this, more than 18% of bets appear to be placed by gamblers who choose to pay tax on the return. We explore the hypothesis that this apparent violation of rationality may be explained by a component of utility which represents the consumption value of gambling, which in turn varies with the amount wagered. We then estimate this component from a dataset consisting of a record of 25,000 individual bets using probit analysis of the tax decision. [ABSTRACT FROM AUTHOR]

Decisions vary. They may vary in both content and complexity. People also vary. An important way that people vary is how much they think. Some prior research investigating thinking and decision making largely conflicts with most traditional decision theories. For example, if considering an array of products to choose from, thinking more about the alternative's attributes should lead to a better decision. However, some research indicates that thinking more may also lead to focusing on irrelevant aspects of the decision and a less optimal outcome. We propose that this conflict in the literature exists because of a failure to consider the interaction between the individual and the decision task. To test this, we used separate methodologies that enhance or attenuate a person's thinking. In Study 1, we selected people who were especially high or low in need for cognition and had them complete a robust decision‐making inventory, which included both complex and simple tasks. In Study 2, we manipulated participant's level of glucose, which acts as the brain's fuel to enhance or attenuate thinking ability. Both studies provide insight for understanding our central tenant that more thought leads to better decisions in complex tasks but does not influence simple decisions. These findings show how the individual's thinking can interact with the constructive elements of the task to shape decision choice. [ABSTRACT FROM AUTHOR]

Although early economic approaches to misbehavior merely compare the monetary utility of accessible options, self‐concept maintenance models introduce moral considerations to the equation. These assume that people trade off possible gains to be made from moral transgressions with associated decreases in self‐esteem. On the basis of the assumption that the development of moral values among children is weaker than in adults, we expected children's behavior to be close to that of the hypothetical homo economicus, with their decisions as to whether to cheat therefore being influenced by decision theory elements: normative elements such as temptation magnitude, and behavioral elements such as framing. As children should pay no heed to moral considerations in dynamic multiple task settings, behavior opposite to "moral cleansing" was expected, with a first lie predicting later lies. In addition to testing the above ideas, the present study adopted a novel methodology. Our hypotheses were tested in a lab‐in‐the‐field study using a modified "roll a die" method in a naturalistic setting for children of ages 7 to 10. We modified the method to identify both true and declared values of die rolls (a novel DICE+ electronic die was used). As expected, children were sensitive to temptation and cheated more willingly for more attractive prizes. Girls (but not boys) lied more (in terms of both frequency and magnitude) to avoid losses (with loss framing) than to make gains (with gain framing). Previous lying correlated positively with lying on subsequent tasks. [ABSTRACT FROM AUTHOR]

The study of cognitive processes is built on a close mapping between three components: overt gaze behavior, overt choice, and covert processes. To validate this overt–covert mapping in the domain of decision‐making, we collected eye‐movement data during decisions between risky gamble problems. Applying a forward inference paradigm, participants were instructed to use specific decision strategies to solve those gamble problems (maximizing expected values or applying different choice heuristics) during which gaze behavior was recorded. We revealed differences between overt behavior, as indicated by eye movements, and covert decision processes, instructed by the experimenter. However, our results show that the overt–covert mapping is for some eye‐movement measures not as close as expected by current decision theory, and hence question reverse inference as being prone to fallacies due to a violation of its prerequisite, that is, a close overt–covert mapping. We propose a framework to rehabilitate reverse inference. [ABSTRACT FROM AUTHOR]

The article focuses on the issues related to naturalistic decision making (NDM). The lucidity of the present exposition greatly helps to understand the appeal of NDM, and at the same time alerts the reader to aspects which may not be fully clear. The present reader found himself slightly confused at two points. In line with the actor-observer effect in attribution theory, he immediately blamed his mental state on the NDM approach, or more precisely on its treatment. Herein lies an implicit source of conflict. To the extent that expertise implies ideal performance, descriptive and prescriptive perspectives converge. The second hazy theme in an otherwise instructive overview is the nature of NDM's contributions to our general understanding of the decision-making process.

In three experiments the problem is investigated how people identify early in the decision process those alternatives that are worthwhile to be examined in more detail. We assume that decision makers employ the Advantages first Principle: They first search for information about positive outcomes and then focus their information search (e.g., for negative consequences or for risk defusing operators) on those alternatives that appear attractive after this initial evaluation. In Experiment 1 (120 participants), initial information about consequences was varied for eight alternatives (no information, positive consequences, negative, or mixed for four alternatives). In all conditions, the great majority of participants followed both aspects of the Advantages first Principle. In Experiment 2, 60 participants decided in two quasi-realistic scenarios with two alternatives each. Initial information was presented so that one alternative had better positive consequences, worse negative consequences, or both. In all conditions, more information was searched for in the initially better alternative. In Experiment 3 (20 participants) the Advantages first Principle was not only confirmed for a scenario but also for choices in traditional gambling tasks with two and eight alternatives, respectively. Participants could win or lose real money. Copyright © 2010 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

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Many everyday decisions have to be made under risk and can be interpreted as choices between gambles with different outcomes that are realized with specific probabilities. The underlying cognitive processes were investigated by testing six sets of hypotheses concerning choices, decision times, and information search derived from cumulative prospect theory, decision field theory, priority heuristic and parallel constraint satisfaction models. Our participants completed 40 decision tasks of two gambles with two non-negative outcomes each. Information search was recorded using eye-tracking technology. Results for choices, decision time, the amount of information searched for, fixation durations, the direction of the information search, and the distribution of fixations conflict with the prediction of the non-compensatory priority heuristic and indicate that individuals use compensatory strategies. Choice proportions are well in line with the predictions of cumulative prospect theory. Process measures indicate that individuals thereby do not rely on deliberate calculations of weighted sums. Information integration processes seem to be better explained by models that partially rely on automatic processes such as decision field theory or parallel constraint satisfaction models. Copyright © 2010 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Sex differences in the extent of mate search were investigated using two sequential choice processes. In Study 1, attribute search, prior to choosing a mate or rejecting two competing mates, for either a short- or long-term relationship, was explored. Men (women) seeking short-term relationships were the least (most) likely to reject both suitors. Men acquired a greater number of attributes prior to rejecting mates. The length of the relationship solely affected men's search behaviors. Study 2 utilized a nested sequential model namely participants decided how many suitors to sample prior to choosing a short-term mate, and how many attributes to acquire on each sampled suitor. Women sampled a greater number of suitors prior to choosing a mate. Biological sex was found to be a greater moderator of mate search than were three personality traits linked to search. Across both studies less information was acquired prior to rejecting versus choosing a mate. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This study evaluates the effect of forgone payoffs in decision-making tasks used for studying individual differences. We investigate whether the disclosure of forgone payoffs (defined as payoffs associated with un-chosen alternatives) has selective effects for drug abusers. Evidence suggests that drug abusers are hypersensitive to signals of positive reward. Accordingly, because the forgone payoffs of risky high-variability options include rewarding outcomes, this may create a distraction and lead drug abusers to make more risky choices. In a controlled experiment, we examined the behavior of high-functioning drug abusers and healthy controls using the Iowa gambling task. The results showed that in a forgone payoff condition, drug abusers made more risky choices. The results demonstrate that adding information about forgone payoffs can be useful for studying individual differences, and that studying individual differences can be valuable in evaluating the effects of forgone payoffs. Copyright © 2005 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We studied asymmetric competition between two (three-person) groups. Each group member received an initial endowment and had to decide whether or not to contribute it. The group with more contributions won the competition and each of its members received a reward. The members of the losing group received nothing. The asymmetry was created by randomly and publicly selecting one group beforehand to be the winning group in the case of a tie. A theoretical analysis of this asymmetric game generates two qualitatively different solutions, one in which members of the group that wins in the case of a tie are somewhat more likely to contribute than members of the group that loses, and another in which members of the group that loses in the case of a tie are much more likely to contribute than members of the group that wins. The experimental results are clearly in line with the first solution. Copyright © 2005 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

A rational principle of decision making called dynamic consistency was tested by presenting decision makers with a sequence of two gambles. The first gamble was obligatory. Before playing the first gamble, participants were asked to make a planned choice as to whether they would take the second gamble. After experiencing the actual results of the first gamble, decision makers were asked to make a final choice regarding the second gamble. Dynamic consistency requires agreement between the planned and final choices. Violations of dynamic consistency were observed, e.g. anticipating a gain in the first gamble, decision makers planned to take the second gamble; after experiencing the gain, they changed their minds and rejected the second gamble. Two models of dynamic inconsistency were compared. One assumes that experience shifts the reference point and changes the utility associated with the gamble; another assumes that experience changes the subjective probability associated with the gamble. The reference point model provided the best account for the findings. Copyright © 2003 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We report three studies demonstrating the ‘lure of choice’ people prefer options that allow them to take further choices over those that do not, even when the extra choices cannot improve the ultimate outcome. In Studies 1 and 2, participants chose between two options: one solitary item, and a pair of items between which they would then make a further choice. Consistent with the lure of choice, a given item was more likely to be the ultimate choice when it was initially part of a choice pair than when it was offered on its own. We also demonstrate the lure of choice in a four-door version of the Monty Hall problem, in which participants could either stick with their original choice or switch to one of two unopened doors. Participants were more likely to switch if they could first ‘choose to choose’ between the two unopened doors (without immediately specifying which) than if they had to choose one door straightaway. We conclude by suggesting that the lure of choice is due to a choice heuristic that is very reliable in the natural world, but much less so in a world created by marketers. Copyright © 2003 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Recent decision-making research claims to establish that, in violation of Savage's normative sure-thing principle, individuals often wait to acquire noninstrumental information and subsequently base their decisions upon this information. The current research suggests that characterizing individuals as pursuing noninstrumental or useless information may be overstated. Through a series of experiments we establish, first, that many people choose to wait, even when waiting provides no additional information at all. Second, the longer people are allowed to wait before having to decide, the more people prefer to wait rather than decide immediately. Third, those individuals who choose to wait are the ones less confident about committing themselves to a decision. For them, the benefit from waiting may be especially valuable by allowing them to come to terms with a less-than-ideal decision. Copyright © 2003 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We examined how people use social and verbal cues of differing priorities in making social decisions. In Experiment 1. formally identical life-death choice problems were presented In different hypothetical group contexts and were phrased in either a positive or negative frame. The risk-seeking choice became more dominant as the number of kin in an endangered group increased. Framing effects occurred only in a heterogeneous group context where the lives at risk were a mixture of kin and strangers. No framing effect was found when the same problem was presented in the context of a homogeneous group consisting of either all kin or all strangers. We viewed the framing effects to be a sign of indecisive risk preference due to the differential effects of a kinship cue and a stranger cue on choice. In Experiment 2. we presented the life-death problem in two artificial group contexts involving either 6 billion human lives or 6 billion extraterrestrial lives. A framing effect was found only in the human context. Two pre-conditions of framing effects appear to be social unfamiliarity of a decision problem and aspiration level of a decision maker. In Experiment 3. we analyzed the direction of the framing effect by balancing the framing. The direction of the framing effect depended on the baseline level of risk preference determined by a specific decision context [ABSTRACT FROM AUTHOR]

Perhaps the most fundamental principle of decision theory is that more money is preferred to less: the principle of desired wealth. Based on this and other principles such as reference dependence and loss aversion, researchers have derived and demonstrated mental accounting (MA) rules for multiple outcome situations. Experiment 1 tested the invariance of the desired wealth principle and two mental accounting rules (mixed gain, e.g. $100 gain and a $50 loss; mixed loss, e.g. $100 loss and a $50 gain) across types of decision maker and frame. The desired wealth principle and the MA rule for mixed gains were found to vary depending upon (1) the thoughtfulness of the decision maker (need for cognition, NC), and (2) the frame used to describe gains and losses (e.g. a gain of $x versus a gain of y%). The MA rule for mixed losses, however, was found to be immune to framing effects, even among people who are generally less thoughtful. The differential processing of gains and losses across frames (dollar versus percentage) and individuals (less versus more thoughtful) was tested further in Experiment 2 where evaluations of mixed losses were made at the level of the gestalt as well as the constituent (the gain and the loss being evaluated separately). Framing effects were evidenced only among subjects lower in NC and only when the constituent gain was evaluated. Evaluations of the overall mixed loss and the constituent loss were comparable across situation and individual, suggesting that losses motivate greater processing among people otherwise inclined toward cognitive miserliness. [ABSTRACT FROM AUTHOR]

Many decisions can be framed either as 'choices' between alternative courses of action (e.g. Should I move to New York or stay in Chicago?) or as 'opportunities' to pursue a particular course of action (i.e. Should I move to New York?). Although there is no logical difference between these two different decision frames, there may be important psychological differences between them. In four studies, we explore the differences between 'choices' and 'opportunities'. The results of Studies 1 and 2 show that college students view many of the decisions they typically face as opportunities, rather than choices. Further, the results of Study 2 suggest that the frame students adopt is systematically related to the preferences they express. The latter finding led to Studies 3 and 4, where we show that preferences can be influenced by encouraging people to adopt one decision frame rather than another. [ABSTRACT FROM AUTHOR]

In each of two experiments respondents were asked to narrow a given set of multiattribute options to a final choice in three successive stages. Some participants were asked to record which options they would include at each stage while others were asked to record which options they would exclude at each stage. The choice options in Experiment 1 were 24 alternative automobile descriptions, while in Experiment 2 participants were presented with 32 different graduate schools. Consistent with the existence of separate criteria for inclusion and exclusion, significantly more options were retained prior to final choice (in Stages 1 and 2) under exclusion than under inclusion. This finding held both for options with and without missing information. Nevertheless, when we examined Stage 3 in each experiment, we found no systematic differences between the distribution of final choices in each condition. These results, along with supplemental data, support a theoretical account in which options about which the decision maker is unsure are retained under exclusion but not under inclusion. [ABSTRACT FROM AUTHOR]

Decision attitude--an analog of risk attitude--is the propensity to make (or avoid making) a decision: in decision aversion, a person finds it more desirable to receive through fiat the better of two options than to have a choice between them; in decision seeking, the choice is more desirable, even though it can lead to nothing better than the best option. Both decision aversion and decision seeking were found in hypothetical scenarios. Experimental manipulations and subjects' justifications point to anticipated regret, fear of blame for poor outcomes, and desire for equitable distributions as sources of decision aversion. One source of decision seeking (for self) and decision aversion (when deciding for others) appears to be the desire for the self-determination of the affected parties. We consider the implications of our results for personal choice and public policy decisions. [ABSTRACT FROM AUTHOR]

Twelve groups of five subjects each participated in a nonco-operative game in which each member of a group receives the same endowment and must then decide independently and anonymously how much of it to contribute to the group benefit. Regardless of the size of his or her contribution, each member receives the same reward if, and only if, the sum of contributions is equal to or larger than a prespecified provision threshold. The results show that the level ofcontribu-tion depends on the provision threshold, and that it increases when contributions are not restricted to be all-or-none. We present, discuss, and competitively test two models for this class of social dilemmas, one postulating maximization of expected utility and the other yielding an equitable solution. [ABSTRACT FROM AUTHOR]

In some decision contexts (e.g. graduate admissions) the task to select a subset of A distinct alternatives from among the N > k > 1 options available. For moderate values of N and k, the number of possible subsets of size k becomes quite large. Assuming alternatives are evaluated using consistent, though not explicit weights, selecting k, rather than 1, empirically excludes a substantial proportion (more than 80%) of the subsets; unfortunately to the unaided decision maker it is not obvious which subsets should be excluded. The tendency of subjects to select excludable subsets can be called an 'infeasibility' bias. The experimental evidence surprisingly shows no 'infeasibility' bias, as subjects overwhelmingly chose non-excluded selections. [ABSTRACT FROM AUTHOR]

The study investigates the visual salience of information in making differential predictions for alpha-numeric versus graphic displays in consumer decision making. The experiment partially supports predictions that with alpha-numeric displays, information is acquired in correspondence with the importance weights of the attributes, whereas under graphic conditions, information is acquired in correspondence with the visual salience of the attributes. The information display form appears to have some effect not only on the temporal order in which information on attributes is acquired, but also on the relative attention given to information on attributes during the early phases of decision making. [ABSTRACT FROM AUTHOR]

The article evaluates recent issues and trends in naturalistic decision making (NDM) that are dictated by the rapid technological changes of the last few decades which have radically changed the nature of human work. A naturalistic decision-making (NDM) task should ideally imply factors like: high personal stakes, ill-defined goals, uncertainty, and time pressure. It should have both a judgment and a choice component, require the analyzing of several sources of information, and should preferably be performed by real decision makers. The good news is that there are indications that NDM is slowly moving back towards basic decision research and that basic research is becoming increasingly naturalistic.

The article focuses on the provocative challenges to the mainstream in the field of decision making. For more than a decade, the feisty band of researchers and practitioners who have gathered under the naturalistic decision-making (NDM) banner have mounted a provocative challenge to the mainstream in the field of decision making. The danger in this shift of emphasis is that the NDM program will run out of steam as it studies decision makers one profession or domain at a time rather than identifying representative domains, settings and boundary conditions and building a unified approach or family of models that explains the factors that shape decision making in the field. This is the true contrast with classic decision making and behavioral decision theory.

The article focuses on the problems and methods in naturalistic decision making (NDM) research. The decision to regard NDM as a distinct endeavor rather than an integral part of the study of decision making has conceptual, methodological, and analytical implications that need to be carefully reconsidered. NDM research is concerned with idiosyncratic and highly specialized decisions often made under conditions of acute stress and time pressure. These decisions are fascinating and important to understand, but they render controlled experimentation essentially impossible. Hard problems are fine to study, as long as the power of the available tools is not overestimated in the process. NDM explores large, intense, multi-faceted and harder-to-isolate decisions.

The article focuses on naturalistic decision making (NDM) and prescriptive decision theory (PDT). NDM begins with the uncontestable proposition that the quality of a decision-making process is determined not by its logical consistency but by the quality of decisions which tend to emerge from that process. As a result, it studies the decision-making process of experienced and successful decision makers. NDM, without undermining the foundations of PDT, might be able to substantially improve the quality and the acceptability of PDT's decision processes.

The article focuses on naturalistic decision making (NDM) research. Two possible NDM weaknesses have been pointed out by experts: (1) NDM researchers are unclear on what constitutes an error, and (2) NDM methodology might be "soft." Refutability is probably one of NDM's weaknesses. But one can argue that NDM is at a particular moment in its evolution. The main goal a scientist might pursue is to know what he or she does, and to know that what he or she is doing is only one specific way among many possible ways.