From Shakespeare to Spielberg
(with apologies to Paul Slovic):
Some Reflections on Modes of Decision Making
Elke U. Weber
J/DM Meeting
November 1998
• What a piece of work is man.
How noble in reason.
How infinite in faculty.
In apprehension how like a god!
Hamlet, II, ii
• I've got a bad feeling about this!
Raiders of the Lost Ark
• Feel the force, Luke.
Star Wars
Qualitatively-different Modes of Making
Decisions
• Cost-benefit-based decision making
(Edwards, 1954; von Winterfeldt & Edwards, 1986;
Payne, Bettman, & Johnson, 1993)
• Category-based or rule-based decision making
(Simon, 1990; Beach & Mitchell, 1987, 1990):
–
–
–
–
nondeliberative decisions (Ronis, Yates, & Kirscht, 1989)
stereotype-based decisions (Fiske & Pavelchak, 1986)
case-based decisions (Chase & Simon, 1973; Klein, 1998)
principle-based decisions (Prelec & Herrnstein, 1991)
• Role-based decision making
(March, 1994)
• Reason- or argument-based decision making
(Shafir, Simonson, & Tversky, 1993; Hogarth &
Kunreuther, 1995; Tyszka, 1998)
• Affect-based decision making
(Damasio, 1993; Epstein, 1994; Loewenstein, Weber, Hsee
& Welch, 1998; Wright, 1975)
• Story-based decision making
(Pennington & Hastie, 1988, 1992, 1993;
Goldstein & Weber, 1995)
Emerging list of qualitativelydifferent decision modes
• Calls for a meta-decision framework that
predicts (implicit) decision mode selection
• Decision mode prediction matters because
mode often affects/dictates outcome
• Conceptual extension of the pioneering
Adaptive-Decision-Maker program of
Payne, Bettman, & Johnson (1988, 1993)
– broader range of decision modes
– broader range of selection criteria
• beyond effort and accuracy
Decision Making as Constrained
Optimization
• Specification of
Objective Function
• Identification of Constraints
Identification of Constraints
•Cognitive Limitations (Simon, 1954)
– attention
– working memory
•Emotional Limitations
– finite pool of resilience (Linville & Fischer, 1991)
– self-control problems
– mental accounting (Thaler, 1985)
– precommitment strategies (Ainslie, 1975)
Identification of Constraints
• Extremely productive chapter in history of
J/DM
• Chapter that is written
More Accurate Specification of
Objective Function
• Selten (1997)
– economic conceptualization of human
motivation is incomplete at best
• In addition to material well-being,
people have been shown to care about
– post-decisional consequences and comparisons
• Loomes & Sugden, 1982; Mellers, Schwartz, & Ritov,
1997; Birnbaum & Stegner, 1979; Weber, 1994
– fairness and justice
• Mellers & Baron, 1993
– justifiability
• Shafir, Simonson, & Tversky, 1993; Tetlock, 1992
– confidence and self-esteem
• Larrick, 1993
• Habermas’ (1972) taxonomy of human
interests and concerns
– technical concerns: instrumental action
– practical concerns: social understanding
– emancipatory concerns: reflection, autonomy
Predictive framework of (implicit)
decision mode selection
• Predictor variables should include
– characteristics of decision maker
• basic human motivation
• individual differences
• cultural differences
– characteristics of decision situation
• decision context
• decision content
Content-Dependence of Decision
Making
• Goldstein and Weber (1995) show
progression from content-independent to
content-dependent theorizing in
– memory
– learning
– deductive reasoning
• evidence of necessity of content-dependent
theory for decision making
(Frisch, 1993; Gigerenzer & Hug, 1992)
Decision Mode Selection as
Mechanism for Content Dependence
• different content domains prime different
facets of human motivation
• different needs are best served by different
decision modes
• different decisions modes can lead to
different choices
How does decision mode
selection work at a process level?
• Must involve similarity-based recognition
process
• Research approach:
Make implicit categorization explicit
– Tada & Weber, 1998
Unanswered questions related to
availability of different ways of
making decision
• Need for research on use of multiple modes
of decision making
– Loewenstein, Weber, Hsee, and Welch (1998)
argue for primacy of emotion-based decision
making in risky choice
– yet, decisions are probably usually made on
multiple levels
Questions related to multiple
modes of decision making
• Do modes operate sequentially or in parallel?
• How do they combine?
– Race model? Majority rule? Average solution?
– How are conflicts in suggested course of action
resolved?
– Is confidence in final answer related to such
conflicts?
Summary
• broader conceptualization of human nature
may provide more descriptive objective
functions
• broader appreciation of the adaptive
functions of different decision modes will
help in predicting decision mode selection
• studying criteria and processes by which
people (implicitly) select decision modes
may provide parsimoneous explanation of
content-dependence of decision making
References
• Ainslie, G. (1975). Specious reward: A behavioral theory of impulsiveness and impulse control.
Psychological
Bulletin, 82, 463-496.
• Beach, L.R. (1990). Image theory: Decision Making in Personal and Organizational contexts. Chichester, UK:
John Wiley.
• Beach, L.R., & Mitchell, T.R. (1987). Image theory: Principles, plans, and goals in decision making. Acta
Psychologica, 66, 201-220.
• Beach, L.R., & Mitchell, T.R. (1990). Image theory: A behavioral theory of decisions in organizations. In B. M.
Staw & L. L. Cummings (Eds.), Research in Organizational Behavior (Vol. 12). Greenwich, CT: JAI Press.
• Birnbaum, M. H., & Stegner, S. E. (1979). Source credibility in social judgment: Bias, expertise, and the judge’s
point of view. Journal of Personality and Social Psychology, 37, 48-74.
• Blais, A.-R., & Weber, E. U. (1998). Women, decision content, and other dangerous things. Working Paper, Center
for Behavioral Decision Theory, Ohio State University.
• Chase, W.G., & Simon, H.A. (1973). Perception in chess. Cognitive Psychology, 4, 55-81.
• Damasio, A. R. (1993). Descartes’ Error. New York: Avon Books.
• Edwards, W. (1954). The theory of decision making. Psychological Bulletin, 51, 380-417.
• Epstein, S. (1994). Integration of the cognitive and the psychodynamic unconscious. American Psychologist, 49,
709-724.
• Fein, E., & Weber, E. U. (1998). Content-specific methods of decision making. Working Paper, Center for
Behavioral Decision Theory, Ohio State University.
• Fiske, S.T., & Pavelchak, M.A. (1986). Category-based versus piecemeal-based affective responses: Developments
in schema-triggered affect. In R.. Sorrentino & E.T. Higgins (Eds.), Handbook of Motivation and Cognition:
Foundations of Social Behavior (pp. 167-203). New York: Guilford Press.
• Frisch, D. (1993). Reasons for framing effects. Organizational Behavior and Human Decision Processes, 54, 399429.
• Gigerenzer, G., & Hug, K. (1992). Domain-specific reasoning: Social contracts, cheating, and perspective changes.
Cognition, 43, 127-171.
References, cont’d
• Goldstein, W. M. & Weber, E. U. (1995). Content and its discontents: The use of knowledge in decision making.
In J. R. Busemeyer, R. Hastie, D. L. Medin (Eds.) Decision making from a cognitive perspective. The Psychology
of Learning and Motivation, Vol. 32 (pp. 83-136). New York: Academic Press.
• Habermas, J. (1972). Knowledge and Human Interests. Boston, MA: Beacon Press.
• Hogarth, R., & Kunreuther, H. (1995). Decision making under ignorance: Arguing with yourself. Journal of Risk
and Uncertainty, 10, 15-36.
• Klein, G. (1998). Sources of power: How people make decisions. MIT Press.
• Larrick, R.P. (1993). Motivational factors in decision theories: The role of self-protection. Psychological Bulletin,
113, 440-450.
• Linville, P.W., & Fischer, G.W. (1991). Preferences for separating or combining events. Journal of Personality
and Social Psychology, 59, 5-21.
• Loewenstein, G.F., Weber, E.U., Hsee, C.K., & Welch, E. (1998). Risk as feelings. Working Paper, CMU.
• Loomes, G., & Sugden, R. (1982). Regret theory: An alternative theory of rational choice under uncertainty.
Economic Journal, 92, 805-824.
• March, J. G. (1994). A Primer of Decision Making: How Decisions Happen. New York: The Free Press.
• Mellers, B.A., & Baron, J. (Eds.). (1993). Psychological Perspectives on Justice: Theory and Applications.
Cambridge, UK: Cambridge University Press.
• Mellers, B. A., Schwartz, A., Ho, K., Ritov, I. (1997). Decision affect theory: Emotional reactions to the outcomes
of risky options. Psychological Science, 8, 423-429.
• Payne, J.W., Bettman, J.R., & Johnson, E.J. (1988). Adaptive strategy selection in decision making. Journal of
Experimental Psychology: Learning, Memory, and Cognition, 14, 534-552.
• Payne, J.W., Bettman, J.R., & Johnson, E.J. (1993). The Adaptive Decision Maker. Cambridge: Cambridge
University Press.
• Pennington, N., & Hastie, R. (1988). Explanation-based decision making: The effects of memory structure on
judgment. Journal of Experimental Psychology: Learning, Memory, and Cognition, 14, 521-533.
References, cont’d
• Pennington, N., & Hastie, R. (1992). Explaining the evidence: Tests of the story model for juror decision making.
Journal of Personality and Social Psychology, 62, 189-206.
• Pennington, N., & Hastie, R. (1993). Reasoning in explanation-based decision making. Cognition, 49, 123-163.
• Prelec, D. & Herrnstein, R. (1991). Preferences or principles: Alternative guidelines for choice. In R. J. Zeckhauser
(Ed.), Strategy and Choice. Cambridge: MIT Press.
• Rabin, M. (1993). Incorporating fairness into game theory and economics. American Economic Review, 83, 12811302.
• Ronis, D.L., Yates, J.F., & Kirscht, J.P. (1989). Attitudes, decisions, and habits as determinants of repeated
behavior. In A.R. Pratkanis, S.J. Breckler, & A.G. Greenwald (Eds.), Attitude Structure and Function (pp. 213239). Hillsdale, N.J.Erlbaum.
• Selten, R. (1997). Features of experimentally observed bounded rationality. Discussion Paper B-421, University of
Bonn.
• Shafir, E., Simonson, I., & Tversky, A. (1993). Reason-based choice. Cognition, 49, 11-36.
• Simon, H.A. (1956). Rational choice and the structure of the environment. Psychological Review, 63, 129-138.
• Simon, H.A. (1990). Invariant of human behavior. Annual Review of Psychology, 41, 1-19.
• Tada, Y., & Weber, E. U. (1998). Representing psychological dimensions of decisions: Implications for behavioral
decision models. Proceedings of the Twentieth Annual Conference of the Cognitive Science Society (pp. 10491054). Hillsdale NJ: Lawrence Erlbaum.
• Tetlock, P. E. (1992). The impact of accountability on judgment and choice: Toward a social contingency model.
Advances in Experimental Social Psychology, 25, 331-376
• Thaler, R. (1985). Mental accounting and consumer choice. Marketing Science, 4, 199-214.
• Tyszka, T. (1998). Two pairs of conflicting motives in decision making. Organizational Behavior and Human
Decision Processes, 74, 189-211.
• Weber, E. U. (1994). From subjective probabilities to decision weights: The effect of asymmetric loss functions
on the evaluation of uncertain outcomes and events. Psychological Bulletin, 115, 228-242.
• Wright, P. (1975). Consumer choice strategies: Simplifying vs. optimizing. Journal of Marketing Research, 11, 6067.
References
• Ainslie, G. (1975). Specious reward: A behavioral theory of impulsiveness and impulse control.
Psychological
Bulletin, 82, 463-496.
• Beach, L.R. (1990). Image theory: Decision Making in Personal and Organizational contexts. Chichester, UK:
John Wiley.
• Beach, L.R., & Mitchell, T.R. (1987). Image theory: Principles, plans, and goals in decision making. Acta
Psychologica, 66, 201-220.
• Beach, L.R., & Mitchell, T.R. (1990). Image theory: A behavioral theory of decisions in organizations. In B. M.
Staw & L. L. Cummings (Eds.), Research in Organizational Behavior (Vol. 12). Greenwich, CT: JAI Press.
• Birnbaum, M. H., & Stegner, S. E. (1979). Source credibility in social judgment: Bias, expertise, and the judge’s
point of view. Journal of Personality and Social Psychology, 37, 48-74.
• Blais, A.-R., & Weber, E. U. (1998). Women, decision content, and other dangerous things. Working Paper, Center
for Behavioral Decision Theory, Ohio State University.
• Chase, W.G., & Simon, H.A. (1973). Perception in chess. Cognitive Psychology, 4, 55-81.
• Damasio, A. R. (1993). Descartes’ Error. New York: Avon Books.
• Edwards, W. (1954). The theory of decision making. Psychological Bulletin, 51, 380-417.
• Epstein, S. (1994). Integration of the cognitive and the psychodynamic unconscious. American Psychologist, 49,
709-724.
• Fein, E., & Weber, E. U. (1998). Content-specific methods of decision making. Working Paper, Center for
Behavioral Decision Theory, Ohio State University.
• Fiske, S.T., & Pavelchak, M.A. (1986). Category-based versus piecemeal-based affective responses: Developments
in schema-triggered affect. In R.. Sorrentino & E.T. Higgins (Eds.), Handbook of Motivation and Cognition:
Foundations of Social Behavior (pp. 167-203). New York: Guilford Press.
• Frisch, D. (1993). Reasons for framing effects. Organizational Behavior and Human Decision Processes, 54, 399429.
• Gigerenzer, G., & Hug, K. (1992). Domain-specific reasoning: Social contracts, cheating, and perspective changes.
Cognition, 43, 127-171.
• Goldstein, W. M. & Weber, E. U. (1995). Content and its discontents: The use of knowledge in decision making.