Notesale: Turn your study into money

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21 May 2019 Tuesday
Decision Making

- Classical Decision Theory
• Model of Economic Man and Woman
- Assumptions:
• Knew all the assumptions available
• understood outcomes of each option
• infinite sensitivity to the subtle assumptions among decision options
• rationally made their final choice
• goal= max value of decision
- Expected Value= objective value x prob
...
weighing of various outcomes
• sound reasoning
• Graphs are important!!!!
- Heuristics and Biases
• heuristics= fastens decision making based on less info
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21 May 2019 Tuesday

- these are mental shortcuts but can make you more prone to errors due to
less info

- Satisficing ( Good Enough)
• considering options one by one until one meets you min
...

all weighted attributes of a;; available options

- eliminate based on the most imp aspect->eliminate from the

remaining based on the second most imp aspect-> cont
...

- P(E\H)= likelihood of the evidence E if the hypothesis H is true
- P(E)= prior prob that the evidence itself is true
- Representativeness Heuristic
• how obvi it is similar to or rep
...
the population

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21 May 2019 Tuesday

• I know a man who phenomenon: we use rep
...
g: symptoms look like ASD
- Availability Heuristic
• making judgements based on how easily we can call to mind that we
perceive as relevant instances of a phenomenon ( media, vividness)

• people hang out a lot on FB/ insta think that ppl are happier than them
on average

• couples claim that they do most of the chores
- Anchoring and Adjustment Heuristic
• ppl adjust their evaluations of things by means of certain ref
...

(anchors)

- 8x7x6x5x4x3x2x1 is eval
...
Two Alternative programs to combat the disease
have been proposed

- if program A—> 200 ppl will be saved
- If program B is adopted, three is a 1/3 prob that 600 will be
saved and 2/3 prob that no one will be saved

- 72% chooses program A —> risk aversion when there are
potential gains (600 >200)

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21 May 2019 Tuesday

- Same scenario w/ other alternatives
• if program C—> 400 will die
• if D—> 1/3 prob that nobody will die and 2/3 prob that 600 ppl
will die

• 78% percent chooses D—> risk seeking
- Framing effect: problem 1 is framed in terms of saving—> risk
aversion

- problem 2 is framed in terms of dying—> risk taking
• Biases
- Illusory Correlation
• when a relationship doesn’t exist
• formed by the pairing of two distinctive events
• Refelmeir and Twesky —
...
g: it always rains on the weekend, it always rain after you was the car,
the phone always tings when you are in the shower
...
c we don’t realize how much we don’t know and the unreliable sources
of info

• when subjects said they were 100% confident, they were only 80%

correct; when they said they were 90% correct, they were only 70%
correct

- this is a robust phenomenon even after warning ppl about it
- Confirmation Bias
• ppl tend to search for and generate evidence and test their ideas in a
way that would conform their beliefs

- Hindsight Bias
• when you look back at a situation, we tend to believe that we should
have seen it coming b/c we realize there were signs

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21 May 2019 Tuesday

• I knew it all along phenomenon: result of memo distortion by
misremembering the original judgement of situation

• ppl w
...
of a given random event is influenced by
previous random events

- e
...

heuristic)

- Men are more overconfident and prone to gambler’s fallacy
• Hot hand effect
- opposite of Gambler’s fallacy: belief that a certain course of events will
persist

- thinking that a basket score is more likely after a scored point
• Conjunction Fallacy
- Conjunction rule: prob of two events cannot be > than the prob of one of
the events

- person gives a higher likelihood to a subset of events than the larger set
containing that subset ( Linda example)

- fueled by rep
...
than as the prob/
%s

- ppl who believe conspiracy theories are more likely to commit conjunction
fallacy

• Sunk- Cost fallacy
- kumar borcunu kapatmak icin kumar oynamak
- keeping investing a car that has been causing problems
• Do heuristics Help Us or Lead Us Astray?
- not always, they are often right and simple ways of reaching a decision
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21 May 2019 Tuesday

- Take-the -best= most imp criterion
- Fast-and-frugal ( Quick-Dirty) = fast based in limited info
- some problems don’t have obvi
...
g: changing your job)

- Naturalistic Decision Making
- decisions made in natural settings —> higher ecological validity
- common features of such situations: ill-structured problems, changing
situations, high risks, time pressure, team environment etc
...
g: grupta homofobi var -> okulda birlik beraberliği artirmaya calisiyoruz->

LGBT haftası düzenlemeyi one surmuyorum-> 19 mayıs şenliği düzenleyelim
diyorum—> patenli kizi memnun edemedik o yüzden sub-optimal solution -> 19
mayıs şenliği ( non traditional)

• Conditions that lead to group think:
- isolated, cohesive and homogenous group is empowered to make decisions
- objective and impartial leadership is absent
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21 May 2019 Tuesday

- high levels of stress during group-decision-making process
• Symptoms of groupthink:
- close mindless
- rationalization
- sequelching of dissent: ignoring and criticizing those who disagree
- feeling invulnerable: burnu havada
- feeling unanimous
• How to avoid
- leader= impartial
- leader should encourage constructive criticism and seek input outside
from the group

- dividing into subgroups to consider alternatives
- leader should prevent fake conformity to group norm
- Neuroscie
...
w/ the activity of parietal
cortex ( monkey work)

• ACC involved in considering potential rewards
• emotions= imp
...
If responder accepts
they get the proposed share, if not nobody gets anything

• responder should always accept the proposed share, but feeling of being
unfairly leads to rejections

• drug abusers-> risky choices b/c of lower activity of left pregenual ACC
( involved in consideration of potential rewards)

• too risky or too cautious decisions in Blackjack in healthy ppl-> increased
activity in ACC

• lower confidence decisions-> longer time to decide-> higher ACC activity
• Acc is involved in the comparison and weighing of possible choices
- Value Discounting & Self Control
• delay btw choice and the eventual outcomes-> better outcomes
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21 May 2019 Tuesday

• V= M/ (1+KD)
• V= val of reward, M= magnitude of reward, D= delay of reward, K=
discounting rate

• Impulsive coice= reduced w/ age
• Hypothetical temporal discounting decreases throughout adolescence
• ventromedial prefrontal activation increases w/ age during TD
• ventral stratal activation decreases w/ age during TD
- Wald’s Throrem
• Sequential Probability Ratio Test

-

- optimal procedure
• min
...
accuracy for a given decision time

- Drift Diffusion Process
• Adt (drift rate) + cdW( noise strength) = dx
• modeling response times in two alternative forced choice decision tasks
•
•
•
•
•
•
•
•

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(2AFC)
they provide good description of neural activity ( monkey’s performaing
2AFC tasks)
diff from simple models of neural integration
Diffusion: Brownian motion, resulting from many tiny impacts on a particle
Drift: a current, or a pressure to move in a single direction
= integrating a constant signal ( producing drift) that has white noise added
to it (producing diffusion)
Diffusion graph: normal dist
...

Neural Evidence: spike rates of neurons in oculomotor areas rise during
stimulus presentation, monkeys signal their choice after threshold is
crossed



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