Judgment & Decision Making
I. Introduction
-when called to assess p(outcome) or make a judgment with
a probabilistic outcome
-make an inductive conclusion based on ‘available data’
The question is, what do those data consist of?
-ideally, raw information, plus anything you bring to the table
Realistically it often doesn’t work like that.
Word of warning: don’t be so damn defensive!
I. Introduction
II. Probability Theory
P(E) = n(E)/n(S)
-e.g. Baron (1988):
A 30-year-old woman discovers a lump in her breast and goes to her physician.
The physician knows that only about 5/100 women of the patient’s age and
health have breast cancer.
A mammogram is taken.
Mammograms indicate cancer 80% of the time in women who have breast
cancer, but also has a false positive rate of 20% (the test says they have cancer
when they don’t).
The mammogram came out positive.
What is the probability that the woman has cancer?
Misunderstanding probability is a main reason why people feel
there are “signs” when coincidences occur
Heuristics:
we tend to resort to ‘rules of thumb’ or shortcuts to help us.
1) Availability heuristic
Cause A
a) Homicide
Words starting with r, or r in 3rd position
Cause B
Appendicitis
b) Auto/train collision
Drowning
c) Smallpox
Measles
d) Botulism
Asthma
e) Asthma
Tornado
f) Appendicitis
Pregnancy
Heuristics:
we tend to resort to ‘rules of thumb’ or shortcuts to help us.
Words starting with r, or r in 3rd position
1) Availability heuristic
2) Representativeness heuristic
Which is more random: HHHHHTTTTT or HTHHTTTHTH?
Our lack of understanding of probability, and inability or
unwillingness to recognize randomness, are exploited here.
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
Another example:
30 engineers and 70 lawyers were given personality tests to complete. From this, brief
personality profiles for each was constructed A sample description follows. Judge the
description by indicating the probability the person is an engineer.
“Jack is a 45-year-old male, who is married with four children. He is generally
conservative, careful, and ambitious. He shows no interest in politics and social issues
and spends most of his free time on his many hobbies, which include carpentry, sailing,
and solving mathematical puzzles.”
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
Series generated from a rule. Your job is to guess the rule.
The series: 2, 4, 6.
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
3) Confirmation bias
Series generated from a rule. Your job is to guess the rule.
The series: 2, 4, 6.
The rule: each number is higher than the last one
Confirmation bias is yet another reason for why people tend to
read more into things than maybe they should: seek and
remember only confirming evidence for your “hypothesis”
e.g. Reagan and 7s, Sept.11, Lincoln & Kennedy
Lincoln was elected to Congress in 1846. Kennedy was elected to Congress in 1946.
Lincoln was elected President in 1860. Kennedy was elected President in 1960.
Both were particularly concerned with civil rights.
Both wives lost their children while living in the White House.
Both Presidents were shot on a Friday. Both Presidents were shot in the head.
Lincoln's secretary was named Kennedy. Kennedy's Secretary was named Lincoln.
Both were assassinated by Southerners. Both were succeeded by Southerners named Johnson.
Andrew Johnson, (succeeded Lincoln), was born in 1808.
Lyndon Johnson, (succeeded Kennedy), was born in 1908.
John Wilkes Booth, who assassinated Lincoln, was born in 1839.
Lee Harvey Oswald, who assassinated Kennedy, was born in 1939.
Both assassins were known by their three names. Both names are composed of fifteen letters.
Lincoln was shot at the 'Ford Theatre’. Kennedy was shot in a 'Lincoln‘, made by 'Ford.'
A week before Lincoln was shot, he was in Monroe, Maryland
A week before Kennedy was shot, he was…uh… with Marilyn Monroe
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
3) Confirmation bias
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
3) Confirmation bias
4) Illusory Correlation
-phrenology, palm reading
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
3) Confirmation bias
4) Illusory Correlation
5) Anchoring and adjustment
Provide the 95% confidence intervals (the range from smallest
to largest, in which you are 95% confident the true value lies)
for each of the following:
1. The number of full-time undergraduates enrolled in Canadian
Universities in 2009
870, 000
2. The current literacy rate of Cuba (i.e. percentage of the
population in Cuba who are as good at reading and writing in
their mother tongue as you are in yours) 97%
3. The size of Sweden in square miles or square kilometres
175,500 square miles
Or
450,000 km2
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
3) Confirmation bias
4) Illusory Correlation
5) Anchoring and adjustment
6) Framing effects
From Tversky & Kahneman, 1981:
Program A: 200 saved
72%
Program B: 33% chance of saving everyone 28%
67% chance of saving nobody
Program C: 400 people will die 22%
Program D: 33% chance nobody dies 78%
67% chance all will die
Heuristics:
When asked to assess the truth of a statement or premise, we
tend to resort to heuristics to help us.
1) Availability heuristic
2) Representativeness heuristic
3) Confirmation bias
4) Illusory Correlation
5) Anchoring and adjustment
6) Framing effects
7) Hindsight bias
The problem is, we’re overconfident in our opinions, because:
a) confirming evidence is readily available (availability heuristic), and
b) we actively avoid disconfirming evidence (confirmation bias).
These biases (and others) are partly why
pseudoscientific claims are still believed by many.
Examples:
homeopathy,
(anecdotal evidence, illusory correlation, confirmation bias)
Reiki, (illusory correlation, confirmation bias, Emily Rosa’s research)
ESP,
(confirmation bias, availability, probability misunderstanding)
-confirmation bias in terms of only remembering the hits, forgetting
misses or false alarms
-e.g. dreaming of the future, telling when someone calls, dowsing, .etc.
These biases (and others) are partly why
pseudoscientific claims are still believed by many.
Examples:
homeopathy,
(anecdotal evidence, illusory correlation, confirmation bias)
Reiki, (illusory correlation, confirmation bias)
ESP,
(confirmation bias, availability, probability misunderstanding)
Psychics who can “talk to the dead”
(cold reading, availability heuristic)
I was on the John Edward show. He even had a multiple guess "hit" on me that was
featured on the show. However, it was edited so that my answer to another question
was edited in after one of his questions. In other words, his question and my answer
were deliberately mismatched. Only a fraction of what went on in the studio was
actually seen in the final 30 minute show. He was wrong about a lot and was very
aggressive when somebody failed to acknowledge something he said.
In other words, a combination of random general
statements for someone to find meaning in, and
creative editing
-after the show, memory blurs, so that all of his questions
tend to be remembered as statements, and availability
heuristic sets in (forget most of the misses)
-interesting, because once you’re aware of the tricks, you
start to see every one of these asses doing them
He is just throwing out a bunch of random information,
and waiting for someone to make sense of it.
The problem is, our sensory systems are designed to seek
out order, and often “see” it, even in random events.
Example: speech processors.
Flexibility and “guesswork” is necessary, and
usually works. But:
“Come back”
“Did we die?”
“Do you believe?”
-the reasons these people will continue to make money:
1) we all want to believe they’re really doing it
2) Non-scientists tend to believe anecdotal evidence
instead of scientific findings
3) We are terrible at recognizing randomness when faced
with it, and are equally bad at judging probabilities
(birthday example)
4) We will ignore or forget most of the negative evidence
anyway