PSYCH 2H03 Chapter Notes - Chapter 12: Orbitofrontal Cortex, Risk Aversion, Risk-Seeking
19 Jun 2018
School
Department
Course
Professor
PSYCH 2H03
Decision Making DECISION MAKING
-Choices, fill our lives – how do we make any of these decisions?
Cost and Benefits
-We’ve a series of goals – things we hope to accomplish/see
-We use these values and goals in making decisions
-Each decision will have certain
oCosts consequences that will carry you farther from your goals
oBenefits consequences moving you toward your goal and providing you with things you value
-You weigh the costs against the benefits and seek a path that’ll minimize the former and maximize the later
oChoose one that provides the best balance
-Utility maximization utility refers to value placed on particular outcome
ono matter how you gain utility you try to make a decision that’ll bring as much utility as possible
Framing of Outcomes
-The change is how the problem was phrased – the frame of the decision – has an enormous impact
-There’s no right answer and you can defend either decision – to avoid risk or to gamble
-If the frame casts a choice in terms of losses decision makers tend to be risk seeking prefer to gamble,
because they hope to reduce loss
-If the frame casts a choice in terms of gains decision makers tend to be risk aversion refuse to gamble,
instead hold on to what they have
Framing of Questions and Evidence
-Considering changes in how a question is framed
-“Award” vs “Deny” custody of a child
-They are influenced by how evidence is framed
-None of this makes sense in the perspective of utility maximization
Maximizing Utility vs. Seeing Reasons
-Maybe we aren’t guided by utility but we decide what we think is reasonable and justified
oReason-based choice
-Asking participants to justify responses – the shift in framing caused a change of factors relevant to that
justification
Emotion
-People’s decisions are powerfully influenced by emotion
-Elliot, unable to feel emotion, unable to make decisions
-People seem to assess risks in emotional terms
oMemories causing a strong bodily reaction
-Somatic markers – guide to decision making, rely on gut feelings to assess various options
oTowards options associated with positive feelings and away from ones that trigger negative
-Orbitofrontal cortex – crucial in use of these somatic markers, brain region that enables interpretation of emotions
Predicting Emotions
-Many decisions depend on a forecast of future emotions
-Decision depends on a prediction about the future – about your likes/dislikes
-Affective forecasting – ability to predict one’s own emotions – is often inaccurate
oPeople overestimate how much they’ll regret their errors later – giving more weight to ‘regret avoidance’
than they should
-People usually predict the ‘valence’ of their reaction – if their reaction will be positive or negative
Document Summary
We"ve a series of goals things we hope to accomplish/see. We use these values and goals in making decisions. Each decision will have certain: costs (cid:0, benefits (cid:0) consequences that will carry you farther from your goals consequences moving you toward your goal and providing you with things you value. You weigh the costs against the benefits and seek a path that"ll minimize the former and maximize the later: choose one that provides the best balance. Utility maximization (cid:0) utility refers to value placed on particular outcome: no matter how you gain utility (cid:0) you try to make a decision that"ll bring as much utility as possible. The change is how the problem was phrased the frame of the decision has an enormous impact. There"s no right answer and you can defend either decision to avoid risk or to gamble. If the frame casts a choice in terms of losses (cid:0) because they hope to reduce loss.
