PSYCH238 Lecture Notes - Lecture 11: Decision-Making, Bounded Rationality, Information Overload

• School: University of Waterloo
• Department: Psychology
• Course: PSYCH238
• Professor: Doug Brown

Document Summary

Decision making: the process of developing a commitment to some course of action. Well structure problem problem for which the existing state is clear, the desired state is clear, and how to get from one state to another is fairly obvious: repetitive, familiar, can be programmed. The compleat decision maker a rational decision-making model. Two forms of rationality that can be contrasted are perfect rationality and bounded rationality. Perfect rationality: a decision strategy that is completely informed, perfectly logical, and oriented toward economic gain: economic person: can gather info without cost and is completely informed, is perfectly logical, only criterion for decision making: economic gain. Framing: the aspects of the presentation of information about a problem that are assumed by decision makers. Cognitive biases: tendencies to acquire and process information in a particular way that is prone to error. Confirmation bias: the tendency to seek out information that conforms to one"s own definition of or solution to a problem.