ECON 1 Lecture Notes - Lecture 10: Discount Window, Somatic Marker Hypothesis, Bounded Rationality
Document Summary
Mental model theory: mental models are representations of reality, they serve to help make sense of a specific phenomenon. Principle of truth: mental models represent what is true, not false. The intuitive system: unconscious, fast, no working memory, one model at a time. The deliberative system: conscious, slow analytic thinking, limited search for other models. Induction: two possibilities, adding information beyond premises to make sense of information. 3 j-l principles: one mental model= one possibility, more mental models make it harder, mistake to use a single model in a multiple model task. Original heuristic analytic theory: reasoning is facilitated by generating one model at a time. Parallel dual process theory: base response on logical reasoning. Deductive reasoning: conclusions follow with certainty from premises. Watson selection test: if card has vowel on one side, it has even number on other. To evaluate deduction, card with vowel has to be turned. Syllogistic reasoning: deductive arguments that involve drawing conclusions from two premises.
