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Patients' memories of the past may influence their decisions about the future, yet memories are imperfect and susceptible to bias. We tested whether a memory failure observed in psychology experiments could be applied in a clinical setting to lessen patients' memories of the pain of an unpleasant medical procedure. We studied consecutive outpatients undergoing colonoscopy who were medically stable, mentally competent, and able to speak English (n=682). By random assignment, half the patients had a short interval added to the end of their procedure during which the tip of the colonoscope remained in the rectum. Pain during the procedure was measured with a ten point intensity scale. Memory following the procedure was measured using both a rating scale and a ranking task. Randomization resulted in two similar groups. As theorized, patients who underwent the extended procedure experienced the final moments as less painful (1.7 vs. 2.5 on a ten point intensity scale, P

The program of research now known as the heuristics and biases approach began with a survey of 84 participants at the 1969 meetings of the Mathematical Psychology Society and the American Psychological Association (Tversky & Kahneman, 1971). The respondents, including several authors of statistics texts, were asked realistic questions about the robustness of statistical estimates and the replicability of research results. The article commented tongue-in-heek on the prevalence of a belief that the law of large numbers applies to small numbers as well: Respondents placed too much confidence in the results of small samples, and their statistical judgments showed little sensitivity to sample size. The mathematical psychologists who participated in the survey not only should have known better – they did know better. Although their intuitive guesses were off the mark, most of them could have computed the correct answers on the back of an envelope. These sophisticated individuals apparently had access to two distinct approaches for answering statistical questions: one that is spontaneous, intuitive, effortless, and fast; and another that is deliberate, rule-governed, effortful, and slow. The persistence of large biases in the guesses of experts raised doubts about the educability of statistical intuitions. Moreover, it was known that the same biases affect choices in the real world, where researchers commonly select sample sizes that are too small to provide a fair test of their hypotheses (Cohen, 1969, 1992).

Uncertainty is an unavoidable aspect of the human condition. Many significant choices must be based on beliefs about the likelihood of such uncertain events as the guilt of a defendant, the result of an election, the future value of the dollar, the outcome of a medical operation, or the response of a friend. Because we normally do not have adequate formal models for computing the probabilities of such events, intuitive judgment is often the only practical method for assessing uncertainty. The question of how lay people and experts evaluate the probabilities of uncertain events has attracted considerable research interest. (See, e.g., Einhorn & Hogarth, 1981; Kahneman, Slovic, & Tversky, 1982; Nisbett & Ross, 1980.) Much of this research has compared intuitive inferences and probability judgments to the rules of statistics and the laws of probability. The student of judgment uses the probability calculus as a standard of comparison much as a student of perception might compare the perceived size of objects to their physical sizes. Unlike the correct size of objects, however, the “correct” probability of events is not easily defined. Because individuals who have different knowledge or hold different beliefs must be allowed to assign different probabilities to the same event, no single value can be correct for all people. Furthermore, a correct probability cannot always be determined, even for a single person. Outside the domain of random sampling, probability theory does not determine the probabilities of uncertain events – it merely imposes constraints on the relations among them.

The present article offers an approach to scientific debate called adversarial collaboration. The approach requires both parties to agree on empirical tests for resolving a dispute and to conduct these tests with the help of an arbiter. In dispute were Hertwig's claims that frequency formats eliminate conjunction effects and that the conjunction effects previously reported by Kahneman and Tversky occurred because some participants interpreted the word “and” in “bank tellers and feminists” as a union operator. Hertwig proposed two new conjunction phrases, “and are” and “who are,” that would eliminate the ambiguity. Kahneman disagreed with Hertwig's predictions for “and are,” but agreed with his predictions for “who are.” Mellers served as arbiter. Frequency formats by themselves did not eliminate conjunction effects with any of the phrases, but when filler items were removed, conjunction effects disappeared with Hertwig's phrases. Kahneman and Hertwig offer different interpretations of the findings. We discuss the benefits of adversarial collaboration over replies and rejoinders, and present a suggested protocol for adversarial collaboration.

Neural responses accompanying anticipation and experience of monetary gains and losses were monitored by functional magnetic resonance imaging. Trials comprised an initial “prospect” (expectancy) phase, when a set of three monetary amounts was displayed, and a subsequent “outcome” phase, when one of these amounts was awarded. Hemodynamic responses in the sublenticular extended amygdala (SLEA) and orbital gyrus tracked the expected values of the prospects, and responses to the highest value set of outcomes increased monotonically with monetary value in the nucleus accumbens, SLEA, and hypothalamus. Responses to prospects and outcomes were generally, but not always, seen in the same regions. The overlap of the observed activations with those seen previously in response to tactile stimuli, gustatory stimuli, and euphoria-inducing drugs is consistent with a contribution of common circuitry to the processing of diverse rewards.

This paper presents a critique of expected utility theory as a descriptive model of decision making under risk, and develops an alternative model, called prospect theory. Choices among risky prospects exhibit several pervasive effects that are inconsistent with the basic tenets of utility theory. In particular, people underweight outcomes that are merely probable in comparison with outcomes that are obtained with certainty. This tendency, called the certainty effect, contributes to risk aversion in choices involving sure gains and to risk seeking in choices involving sure losses. In addition, people generally discard components that are shared by all prospects under consideration. This tendency, called the isolation effect, leads to inconsistent preferences when the same choice is presented in different forms. An alternative theory of choice is developed, in which value is assigned to gains and losses rather than to final assets and in which probabilities are replaced by decision weights. The value function is normally concave for gains, commonly convex for losses, and is generally steeper for losses than for gains. Decision weights are generally lower than the corresponding probabilities, except in the range of low prob- abilities. Overweighting of low probabilities may contribute to the attractiveness of both insurance and gambling. EXPECTED UTILITY THEORY has dominated the analysis of decision making under risk. It has been generally accepted as a normative model of rational choice (24), and widely applied as a descriptive model of economic behavior, e.g. (15, 4). Thus, it is assumed that all reasonable people would wish to obey the axioms of the theory (47, 36), and that most people actually do, most of the time. The present paper describes several classes of choice problems in which preferences systematically violate the axioms of expected utility theory. In the light of these observations we argue that utility theory, as it is commonly interpreted and applied, is not an adequate descriptive model and we propose an alternative account of choice under risk. 2. CRITIQUE

Contrary to theoretical expectations, measures of willingness to accept greatly exceed measures of willingness to pay. This paper reports several experiments that demonstrate that this "endowment effect" persists even in market settings with opportunities to learn. Consumption objects (e.g., coffee mugs) are randomly given to half the subjects in an experiment. Markets for the mugs are then conducted. The Coase theorem predicts that about half the mugs will trade, but observed volume is always significantly less. When markets for "induced-value" tokens are conducted, the predicted volume is observed, suggesting that transactions costs cannot explain the undertrading for consumption goods.

How does jury deliberation affect the pre-deliberation judgments of individual jurors? Do deliberating juries reduce or eliminate the erratic and unpredictable punitive damage awards that have been observed with individual jurors? In this paper we make progress on these two questions, in part by reporting the results of a study of over 500 mock juries composed of over 3000 jury eligible citizens. Our principal finding is that juries did not produce less erratic and more predictable awards than individuals, but actually made the problem worse, by making large awards much larger and small awards smaller still, even for the same case. Thus, a key effect of deliberation is often to polarize individual judgments, a pattern that has been found in many other group decision making contexts. This finding of polarization--the first of its kind in the particular context of punitive damage awards--has important implications for jury awards involving both punitive and compensatory damages, and raises questions about the common belief that groups, and in particular juries, generally make better decisions than individuals.

Participants in contingent valuation surveys and jurors setting punitive damages in civil trials provide answers denominated in dollars. These answers are better understood as expressions of attitudes than as indications of economic preferences. Well-established characteristics of attitudes and of the core process of affective valuation explain several robust features of dollar responses: high correlations with other measures of attractiveness or aversiveness, insensitivity to scope, preference reversals, and the high variability of dollar responses relative to other measures of the same attitude.

Two studies test whether people believe in optimal deterrence. The first provides people with personal injury cases that are identical except for variations in the probability of detection and explores whether lower probability cases produce higher punitive damage awards and whether higher probability cases produce lower awards. No such effect is observed. The second asks people whether they agree or disagree with administrative and judicial policies that increase penalties when the probability of detection is low and decrease penalties when the probability of detection is high. Substantial majorities reject these administrative and judicial policies. Policy implications for the role of the jury in achieving deterrence are explored. Copyright 2000 by the University of Chicago.

Using magnetic resonance imaging, De Martino and colleagues investigated the neural signature that is associated with decisions between small sure amounts of money and large riskier amounts when the framing of the outcomes is varied. We interpret their results within a dual-system framework, in which different frames evoke distinct emotional responses that different individuals can suppress to various degrees. The study advances the integration of brain imaging results into cognitive theory.

textabstractTwo core meanings of “utility” are distinguished. “Decision utility” is the weight of an outcome in a decision. “Experienced utility” is hedonic quality, as in Bentham’s usage. Experienced utility can be reported in real time (instant utility), or in retrospective evaluations of past episodes (remembered utility). Psychological research has documented systematic errors in retrospective evaluations, which can induce a preference for dominated options. We propose a formal normative theory of the total experienced utility of temporally extended outcomes. Measuring the experienced utility of outcomes permits tests of utility maximization and opens other lines of empirical research.

Previously (see Novemsky and Kahneman 2005 ), the authors proposed that intentions to exchange versus to consume a good moderate loss aversion for that good. In this rejoinder, the authors follow up on this idea, discussing several mechanisms that Ariely, Huber, and Wertenbroch (2005) propose by which intentions can moderate loss aversion. The authors consider both emotional attachment to the good and cognitive focus during evaluation as potential mediators of the effects of intentions on loss aversion.

The study of heuristics and biases in judgement has been criticized in several publications by G. Gigerenzer, who argues that "biases are not biases" and "heuristics are meant to explain what does not exist" (1991, p. 102). The article responds to Gigerenzer's critique and shows that it misrepresents the authors' theoretical position and ignores critical evidence. Contrary to Gigerenzer's central empirical claim, judgments of frequency--not only subjective probabilities--are susceptible to large and systematic biases. A postscript responds to Gigerenzer's (1996) reply.

Objective. —To describe ways in which intuitive thought processes and feelings may lead patients to make suboptimal medical decisions. Design. —Review of past studies from the psychology literature. Results. —Intuitive decision making is often appropriate and results in reasonable choices; in some situations, however, intuitions lead patients to make choices that are not in their best interests. People sometimes treat safety and danger categorically, undervalue the importance of a partial risk reduction, are influenced by the way in which a problem is framed, and inappropriately evaluate an action by its subsequent outcome. These strategies help explain examples where risk perceptions conflict with standard scientific analyses. In the domain of emotions, people tend to consider losses as more significant than the corresponding gains, are imperfect at predicting future preferences, distort their memories of past personal experiences, have difficulty resolving inconsistencies between emotions and rationality, and worry with an intensity disproportionate to the actual danger. In general, such intangible aspects of clinical care have received little attention in the medical literature. Conclusion. —We suggest that an awareness of how people reason is an important clinical skill that can be promoted by knowledge of selected past studies in psychology. (JAMA. 1993;270:72-76)

The research was described in detail in preceding technical reports. This final report draws extensively on earlier ones', but it is somewhat selective, focusing on the more important and/or successful themes of the research. The report is organized as follows: (1) Studies of normality. (2) Further studies of contingent coding. (3) Processing of dimensional information in priming. (4) The language of counterfactuals. (5) Comparisons of intrapersonal and interpersonal norms. (6) Mental contamination. (7) Unintended comparisons. (8) Topic and referent in perceptual comparisons. (9) Anchoring.

In the second year of the grant I continued three projects initiated in the first year, and began two new lines of research. A study of contingent coding in normality judgements yielded disappointing results. We started a systematic exploration of the relation between discriminability and similarity, which we plan to extend to categorization and normality. A series of studies established essentially perfect dimensional independence in object-specific priming. We conducted a theoretical and empirical examination of close counterfactuals. Two separate projects dealt with the process of comparison, continuing and extending work reported last year. Keywords: Perception, (Psychology), Categorization, Comparison processes, Normality.

On the occasion of the November 2006 annual meeting of the Israeli-Palestinian Science Organization (IPSO), we, the members of IPSO's International Scientific Council, noted with considerable satisfaction the receipt of 71 proposals for joint scientific research between Palestinian and Israeli

When people make moral or legal judgments in isolation, they produce a pattern of outcomes that they would themselves reject, if only they could see that pattern as a whole. A major reason is that human thinking is category-bound. When people see a case in isolation, they spontaneously compare it to other cases that are mainly drawn from the same category of harms. When people are required to compare cases that involve different kinds of harms, judgments that appear sensible when the problems are considered separately often appear incoherent and arbitrary in the broader context, Another major source of incoherence is what we call the translation problem: The translation of moral judgments into the relevant metrics of dollars and years is not grounded in either principle or intuition, and produces large differences among people. The incoherence produced by category-bound thinking is illustrated by an experimental study of punitive damages and contingent valuation. We also show how category-bound thinking and the translation problem combine to produce anomalies in administrative penalties. The underlying phenomena have large implications for many topics in law, including jury behavior, the valuation of public goods, punitive damages, criminal sentencing, and civil fines. We consider institutional reforms that might overcome the problem of predictably incoherent judgments. Connections are also drawn to several issues in legal theory, including valuation of life, incommensurability, and the aspiration to global coherence in adjudication. Language: en

For their valuable comments, we are most grateful to Cary Coglianese,l Mark Kelman,2 and the team of Theodore Eisenberg, Jeffrey Rachlinski, and Martin Wells (hereafter ERW that Coglianese has elaborated helpfully on the problem of achieving coherence in civil penalties; and that Kelman's basic arguments should not be taken to dispute our claims, which are less different from his own than a reader of his commentary might infer. Apart from these points, which we elaborate below, we offer a more general suggestion, one that is perhaps insufficiently emphasized in our main paper: Even if it is demonstrated, incoherence usually is not taken to be outrageous. The persistence of incoherence, in many domains of the law, is closely connected with this psychological fact.

Although legal scholars have disagreed about whether juries should be allowed to award punitive damages and about how judges should instruct them, the debate has included little discussion of jurors' cognitive capabilities. In this Article, Professors Sunstein, Kahneman, and Schkade respond to this gap by offering an experimental study. The study seeks to separate the tasks that a jury is suited to perform from those that a jury can accomplish only with great inconsistency. In personal injury cases, the study shows, jurors' normative judgments about outrageousness and appropriate punishment are relatively uniform, at least when measured on a bounded numerical scale (0 to 6). Indeed, these normative judgments are uniform across race, age, education, wealth, and gender When subjects map their judgments onto an unbounded dollar scale, however outcomes become erratic and unpredictable. Drawing on these results, the authors question the current legal approaches to the regulation of punitive damages. They then analyze various reform proposals designed to overcome erratic awards, including damage caps, compensatory judgement "multipliers," and conversion formulas that translate either jury judgments on bounded numerical scabs or jury arrangement of comparison cases into punitive damage awards. Finally the authors discuss the implications of the study for many other issues of law: including contingent valuation and compensatory damages in such areas as pain and suffering, libel, sexual harassment, and intentional infliction of emotional distress. Language: en

This article examines the sensitivity of survey measures of willingness to pay for public goods. Visitors to a science museum in San Francisco were asked to provide estimates of their willingness to pay for saving seabirds from oil spills and for teaching English to immigrants under various experimental conditions. Willingness to pay was substantially reduced by a seemingly innocuous reminder about how many individuals would be affected by a tax or would be asked to contribute to a given cause. This finding, which cannot be explained by standard economic interpretations of willingness to pay, is consistent with previous studies showing that subtle changes in question order and wording can affect the nature of the responses. Language: en

In Reply. —We are grateful to Drs Shapiro and Muskin for pointing out that we did not discuss cognitive impairment or psychiatric disorders. We agree that some harmful decisions originate in emotional disturbances and pathological thought processes. Statistics on suicide rates, for example, poignantly document the consequences of depression. However, readers should not conclude that problems in judgment and decision making are confined to patients with neurological or psychiatric disorders. Our aim in the article was to emphasize that normal human intuitions are prone to predictable errors. Clinicians should be alert to the harmful mistakes that reasonable patients are likely to make in evaluating risks and benefits.