L3.2 - JDM (Aug-5) - Particularly Relevant Today Psychology...

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Psychology C120: Lecture 3.2 — Judgment and Decision Making Psychology C120: Lecture 3.2 Judgment and Decision-Making Expected Value and Utility Heuristics and Biases Decision Context 1 Psychology C120: Lecture 3.2 — Judgment and Decision Making Particularly Relevant Today ! Mind and Brain: How does studying cognition go beyond studying the brain? ! How do our cognitive processes refect the structure oF the external world? ! Methods: How can we study cognitive processes without directly observing what the brain is doing? ! How can we express our theories about these processes? ! Performance: How good are we at the cognitive tasks that we undertake? ! What are the limits oF our cognitive capacity? ! What cognitive tasks do we tend to do well, and where do we tend to Fail? ! When studying the mind's perFormance, how do we know what is "right"? ! Information processing in context ! Correspondence, coherence, and pragmatic criteria ! Reductionism vs. emergence and downward causation 2 Psychology C120: Lecture 3.2 — Judgment and Decision Making Questions to Consider ! What evidence is there that people aren't economically rational? ! How can you explain their departures from rationality? ! What heuristics to people use in decision- making, and why? ! When do common heuristics work, and when do they fail? ! In what ways does it help to look more broadly at the context of decision making? 3 Psychology C120: Lecture 3.2 — Judgment and Decision Making What ʼ s decision-making? ! In psychology, decision-making. .. ! Involves uncertainty or risk ! Requires ! Generating a set oF choices ! Evaluating the choices ! Selecting a choice ! Largest problem: Computational complexity ! Primarily, cost oF gathering and evaluating choices ! Solution: Use heuristics — which are sometimes wrong 4
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Overview ! Challenging Homo economicus ! The sometimes bad: heuristics and biases ! The mostly good: decision context 5 Psychology C120: Lecture 3.2 — Judgment and Decision Making Psychology C120: Lecture 3.2 Judgment and Decision-Making Expected Value and Utility Heuristics and Biases Decision Context 6 Psychology C120: Lecture 3.2 — Judgment and Decision Making Homo economicus ! Classical economic theory assumes. .. ! People seek to maximize self-interest ! People have the capacity to do so ! Questions. .. ! What is self-interest? ! Do we have that capacity? 7 Psychology C120: Lecture 3.2 — Judgment and Decision Making Evaluating Rationality ! Requires a normative theory ! Expected value theory: ! Assign values to outcomes ! Estimate probability of outcomes ! Base decision on what maximizes expected
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This note was uploaded on 11/22/2011 for the course PSYCH 120 taught by Professor Hald during the Summer '09 term at University of California, Berkeley.

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L3.2 - JDM (Aug-5) - Particularly Relevant Today Psychology...

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