Typically, decisions are made in the face of some amount of uncertainty.
Rationality: a property of thinking or decision making such that the processes used are selected with the
processor's overall goals and principles in mind.
Success is often taken to be the rationality of the decision.
Cognitive overload: breakdown of cognitive processing that occurs when the available information exceeds
Decision makingrefers to the mental activities that takes place in choosing among alternatives.
The idea is that the decision maker takes stock of his or her plans for the future, his or her principles and
values, and his or her priorities.
What are the various options and possible criteria for making the choice?
Decision structuring: the process(es) by which an individual selects one course of action from among
This may involve a procedure or other decisions such as deciding when the cease the information
gathering phase or deciding which information is more relevant or reliable.
Aim here is to reflect on the process and identify those aspects that could be improved.
Decision making can be divided into five different categories -these tasks often occur in a particular order, but there may
be "cycles" to an order, in which certain tasks are revisited and redone. Phases of decision making conveys the idea that
there may or may not be a set order to the tasks, that the performance of one task can overlap the performance of
another, that some tasks may be skipped, and that tasks can be done in different orders.
Treats differences in intermediate values of probability as corresponding to different gambles or lotteries.
People's intuitions regarding the rules of probability theory are often way off the mark -often much higher than
Subjective probabilities: an intuitive estimate of the likelihood of occurrence of an event.
Probability: measurement of a degree of uncertainty, expressed as a number between 0 and 1.
Biases: a tendency to think in a certain way or to follow certain procedures regardless of the facts of the matter.
Illusions tells us something about the way the perceptual system works generally -what cues are attended to,
how they are interpreted, and so forth.
Answers that randomly fluctuate around the correct value do not count as illusions.
Something counts as a cognitive illusion only if there is a correct way of answering a question or making a
decision, there is also an intuitive estimate or decision, and there's a discrepancy between the two that always
goes in the same direction.
Cognitive illusions: the systematic biases and errors in human decision making.
Those instances are particularly salient and hence are deemed to be more frequent or probable.
Instances that are more easily thought of, remembered, or computed stand out more in one's mind.
This is because our own efforts and behaviours are more apparent and available to us than are the
efforts and behaviours of others.
Both husbands and wives say that they had greater responsibility than did their spouse for 16 of the 20
Availability heuristic: a strategy in which one estimates the frequency or probability of an event by the ease with
which mental operations, such as retrieval of examples or construction of examples, can be carried out.
The failure to include base rate information in your estimates of probability can lead to answers that are in
error, often by an order of magnitude or more.
Gambler's fallacy: a erroneous belief that a random process will automatically keep track of the outcomes
in order to make the overall rate of an outcome in the short run equal to the overall rate of that outcome
In actuality, small samples are much more likely to deviate from the population and are therefore a
less reliable basis on which to build a conclusion than larger samples.
The gambler's fallacy problem can be thought of as an instance of belief in the law of small
Law of small numbers is the idea that people expect small samples to resemble every respect the
populations from which they are drawn.
Representativeness heuristic: a belief that outcomes will always reflect characteristics of the process that
generated them -for example, an expectation that the outcome of a series of coin flips will always look random.
Heuristic: a rule of thumb, or shortcut method, used in thinking, reasoning, and/or decision making.
Chapter 11. Making Decisions