When economists perform experiments, they do so typically in one of two traditions: cognitive psychology experiments in the heuristics and biases tradition (H&B-experiments) and experimental economics in the tradition of Vernon Smith. What sets these two traditions apart? In this paper, I offer a novel conceptualization of their pervasive disagreements. Focusing on how each camp approaches preferences, one of the most fundamental concepts in economics, I argue that experimental economics can be reconstructed as holding that the constituents of preferences can (...) be partially located in agents’ environments, while H&B-experiments implicitly assume that the constituents of preferences are entirely located within agents’ bodies. The paper (i) outlines how my reconstruction can account for the disagreement between the two paradigms, (ii) defends the plausibility of this reconstruction, and (iii) highlights its implications for the debate about the nature of preferences in economics. (shrink)

The book is addressed to all readers interested in cognitive science, and especially in research combining a logical analysis with psychological, linguistic and neurobiological approaches. The publication is the result of a collaboration between the Department of Cognitive Science at University of Lodz and the Department of Cognitive Science at Lund University. It is intended to provide a comprehensive presentation of the key research issues undertaken in both Departments, including considerations on meaning, natural language and reasoning, linguistic as well as (...) numerical competence, the theory of decision making, modelling of conceptual representations, cognitive and game theoretic approach to social interactions. (shrink)

Whether collective agency is a coherent concept depends on the theory of agency that we choose to adopt. We argue that the enactive theory of agency developed by Barandiaran, Di Paolo and Rohde (2009) provides a principled way of grounding agency in biological organisms. However the importance of biological embodiment for the enactive approach might lead one to be skeptical as to whether artificial systems or collectives of individuals could instantiate genuine agency. To explore this issue we contrast the concept (...) of collective agency with multi-agent systems and multi-system agents, and argue that genuinely collective agents instantiate agency at both the collective level and at the level of the component parts. Developing the enactive model, we propose understanding agency – both at the level of the individual and of the collective – as spectra that are constituted by dimensions that vary across time. Finally, we consider whether collectives that are not merely metaphorically ‘agents’ but rather are genuinely agentive also instantiate subjectivity at the collective level. We propose that investigations using the perceptual crossing paradigm suggest that a shared lived perspective can indeed emerge but this should not be conflated with a collective first-person perspective, for which material integration in a living body may be required. (shrink)

Behavioral economics focuses mainly on how limitations of the human cognitive apparatus, risk attitudes, and human sociality affect decision making. The former two lead to deviations from rationality standards, the latter to deviations from rational self-interest. Some of these research interests are also shared by evolutionary psychology which, however, explains the observed deviations by features of the human genetic endowment conjectured to have evolved under fierce selection pressure in early human phylogeny. Important as the decision-making theoretical perspective of the two (...) disciplines is, it will be claimed to be too narrow to fully account for what an evolutionary approach has to say about economic behavior. This is particularly true regarding the questions of what choices are made and what causes them, i.e., the motivational aspects of behavior. In the language of economics this points to the agents’ preferences. This article discusses how preferences relate to the human genetic endowment, how they can change over time, and what conclusions have to be drawn from extending the analysis to the motivational side. (shrink)

One of the interesting research questions in multi-attribute decision-making is what affects the consideration of shared information between two alternatives. Previous studies have suggested two approaches in finding what characteristics of common features affect their consideration. Two bottom-up factors were found, but no top-down factors were discovered. In the current study, we followed the top-down approach and investigated how subjective importance of a common feature affects its consideration. In two studies, we consistently found that, on both the general and individual (...) level, the level of consideration increased with the SI of the common feature. This result provided a new explanation for the effect of common feature consideration and its individual difference; it also provided insights in explaining the underlying process of multi-attribute decision making. (shrink)

The brief article deals with the following questions: Was the adaptive toolbox of heuristics ecologically rational and specifically accurate in the initial stages of COVID-19, which was characterized by epistemic uncertainty? In other words, in dealing with COVID-19 did the environmental structural variables allow the success of a given heuristic strategy?

We propose a neural model of multiattribute-decision processes, based on an attractor neural network with dynamic thresholds. The model may be viewed as a generalization of the elimination by aspects model, whereby simultaneous selection of several aspects is allowed. Depending on the amount of synaptic inhibition, various kinds of scanning strategies may be performed, leading in some cases to vacillations among the alternatives. The model predicts that decisions of a longer time duration exhibit a lower violation of the simple scalability (...) law, as opposed to shorter decisions. Furthermore, the model is suggested as a general attribute-based decision module. Accordingly, various decision strategies are manifested depending on the module's parameters. (shrink)

How can anyone be rational in a world where knowledge is limited, time is pressing, and deep thought is often an unattainable luxury? Traditional models of unbounded rationality and optimization in cognitive science, economics, and animal behavior have tended to view decision-makers as possessing supernatural powers of reason, limitless knowledge, and endless time. But understanding decisions in the real world requires a more psychologically plausible notion of bounded rationality. In Simple heuristics that make us smart (Gigerenzer et al. 1999), we (...) explore fast and frugal heuristics – simple rules in the mind's adaptive toolbox for making decisions with realistic mental resources. These heuristics can enable both living organisms and artificial systems to make smart choices quickly and with a minimum of information by exploiting the way that information is structured in particular environments. In this précis, we show how simple building blocks that control information search, stop search, and make decisions can be put together to form classes of heuristics, including: ignorance-based and one-reason decision making for choice, elimination models for categorization, and satisficing heuristics for sequential search. These simple heuristics perform comparably to more complex algorithms, particularly when generalizing to new data – that is, simplicity leads to robustness. We present evidence regarding when people use simple heuristics and describe the challenges to be addressed by this research program. Key Words: adaptive toolbox; bounded rationality; decision making; elimination models; environment structure; heuristics; ignorance-based reasoning; limited information search; robustness; satisficing; simplicity. (shrink)

This paper tests a novel implication of the original version of prospect theory (Kahneman and Tversky, 1979): that choices may systematically violate transitivity. Some have interpreted this implication as a weakness, viewing it as an anomaly generated by the ‘editing phase’ of prospect theory which can be rendered redundant by an appropriate re-specification of the preference function. Although there is some existing evidence that transitivity fails descriptively, the particular form of non-transitivity implied by prospect theory is quite distinctive and hence (...) presents an ideal opportunity to expose that theory to test. An experiment is reported which reveals strong evidence of the predicted intransitivity. It is argued that the existence of this new form of non-transitive behaviour presents a fresh theoretical challenge to those seeking descriptively adequate theories of choice behaviour, and a particular challenge to those who seek explanations within the conventional economic paradigm of utility maximisation. (shrink)

The first goal of this study was to validate the Rational-Experiential Inventory (REI) and the Cognitive Reflection Test (CRT) through checking their relation to the transitivity axiom. The second goal was to test the relation between decision strategies and cognitive style as well as the relation between decision strategies and the transitivity of preferences. The following characteristics of strategies were investigated: requirements for trade-offs, maximization vs. satisficing and option-wise vs. attribute-wise information processing. Respondents were given choices between two multi-attribute options. (...) The options were designed so that the choice indicated which strategy was applied. Both the REI-R and the CRT were found to be good predictors of the transitivity of preferences. Respondents who applied compensatory strategies and the maximization criterion scored highly on the REI-R and in the CRT, whereas those who applied the satisficing rule scored highly on the REI-R but not in the CRT. Attribute-wise information processing was related to low scores in both measurements. Option-wise information processing led to a high transitivity of preferences. (shrink)

Topics in Cognitive Science, Volume 14, Issue 3, Page 621-633, July 2022.

People often face preferential decisions under risk. To further our understanding of the cognitive processes underlying these preferential choices, two prominent cognitive models, decision field theory (DFT; Busemeyer & Townsend, 1993) and the proportional difference model (PD; González‐Vallejo, 2002), were rigorously tested against each other. In two consecutive experiments, the participants repeatedly had to choose between monetary gambles. The first experiment provided the reference to estimate the models’ free parameters. From these estimations, new gamble pairs were generated for the second (...) experiment such that the two models made maximally divergent predictions. In the first experiment, both models explained the data equally well. However, in the second generalization experiment, the participants’ choices were much closer to the predictions of DFT. The results indicate that the stochastic process assumed by DFT, in which evidence in favor of or against each option accumulates over time, described people’s choice behavior better than the trade‐offs between proportional differences assumed by PD. (shrink)

The independence of irrelevant alternatives is a popular and important axiom of decision theory. It states, roughly, that one’s choice from a set of options should not be influenced by the addition or removal of further, unchosen options. In recent debates, a number of authors have given putative counterexamples to it, involving intuitively rational agents who violate IIA. Generally speaking, however, these counterexamples do not tend to move IIA’s proponents. Their strategy tends to be to individuate the options that the (...) agent faces differently, so that the case no longer counts as a violation of IIA. In this paper, we examine whether this strategy succeeds. We argue that the ways of individuating options required to save IIA from the most problematic counterexamples—in particular, cases where agents violate IIA due to nonconsequentialist moral beliefs—do so only at the expense of severely compromising its central function within decision theory. (shrink)

This paper presents a number of apparent anomalies in rational choice scenarios, and their translation into the logic of everyday reasoning. Three classes of examples that have been discussed in the context of probabilistic choice since the 1960s (by Debreu, Tversky and others) are analyzed in a non-probabilistic setting. It is shown how they can at the same time be regarded as logical problems that concern the drawing of defeasible inferences from a given information base. I argue that initial appearances (...) notwithstanding, these cases should not be classed as instances of irrationality in choice or reasoning. One way of explaining away their apparent oddity is to view certain aspects of these examples as making particular options salient. The decision problems in point can then be solved by ‘picking’ these options, although they could not have been ‘chosen’ in a principled way, due to ties or incomparabilities with alternative options. (shrink)

The notion of ecological rationality implies that the accuracy of a decision strategy depends on features of the information environment in which it is tested. We demonstrate that the performance of a group may be strongly affected by the decision strategies used by its individual members and specify how this effect is moderated by environmental features. Specifically, in a set of simulation studies, we systematically compared four decision strategies used by the individual group members: two linear, compensatory decision strategies and (...) two simple, noncompensatory heuristics. Individual decisions were aggregated by using a majority rule. To assess the ecological rationality of the strategies, we varied (a) the distribution of cue validities, (b) the quantity, and (c) the quality of shared information. Group performance strongly depended on the distribution of cue validities. When validities were linearly distributed, groups using a compensatory strategy achieved the highest accuracy. Conversely, when cue validities followed a J-shaped distribution, groups using a simple lexicographic heuristic performed best. While these effects were robust across different quantities of shared information, the quality of shared information exerted stronger effects on group performance. Consequences for prescriptive theories on group decision making are discussed. (shrink)

This paper explores the relationship between thinking and decision-making. In the first part, the paper analyzes the process of thinking from three aspects – language, psychology, and behavior. It then proceeds to investigate the implications of different kinds of thinking ondecision-making. The final section of the paper raises some questions and concerns about the role of the scientific method in making decisions under conditions of uncertainty. The author offers specific examples from the book publishing business and the movie industry.

Classical (Bayesian) probability (CP) theory has led to an influential research tradition for modeling cognitive processes. Cognitive scientists have been trained to work with CP principles for so long that it is hard even to imagine alternative ways to formalize probabilities. However, in physics, quantum probability (QP) theory has been the dominant probabilistic approach for nearly 100 years. Could QP theory provide us with any advantages in cognitive modeling as well? Note first that both CP and QP theory share the (...) fundamental assumption that it is possible to model cognition on the basis of formal, probabilistic principles. But why consider a QP approach? The answers are that (1) there are many well-established empirical findings (e.g., from the influential Tversky, Kahneman research tradition) that are hard to reconcile with CP principles; and (2) these same findings have natural and straightforward explanations with quantum principles. In QP theory, probabilistic assessment is often strongly context- and order-dependent, individual states can be superposition states (that are impossible to associate with specific values), and composite systems can be entangled (they cannot be decomposed into their subsystems). All these characteristics appear perplexing from a classical perspective. However, our thesis is that they provide a more accurate and powerful account of certain cognitive processes. We first introduce QP theory and illustrate its application with psychological examples. We then review empirical findings that motivate the use of quantum theory in cognitive theory, but also discuss ways in which QP and CP theories converge. Finally, we consider the implications of a QP theory approach to cognition for human rationality. (shrink)

Periodically, by a rough estimate twice per decade, a new popular book aspires to shake our common understanding of rationality. Since this concept is not only the backbone of normative analysis in...

ABSTRACTThis book symposium onAccuracy and the Laws of Credenceconsists of an overview of the book’s argument by the author, Richard Pettigrew, together with four commentaries on different aspects of that argument. Ben Levinstein challenges the characterisation of the legitimate measures of inaccuracy that plays a central role in the arguments of the book. Julia Staffel asks whether the arguments of the book are compatible with an ontology of doxastic states that includes full beliefs as well as credences. Fabrizio Cariani raises (...) concerns about the argument offered in the book for various chance-credence principles. And Sophie Horowitz questions the assumptions at play in the book’s argument for the Principle of Indifference, as well as asking how the various laws of credence considered in the book relate to one another. (shrink)

Indigenous systems of recognition and classification of plants and arthropods are based on local criteria of relationship and contrast. Both inherent intellectual interest and utility considerations play a part in the choice of distinguishing features emphasized. In distinguishing among non-cultivated plants informants display awareness of life habits and morphological features that have little direct bearing on agronomic properties. In discriminating among harmless arthropods, physiological/behavioral attributes are emphasized. When the tasks include cultivated plants and harmful arthropods, functional criteria tend to dominate (...) with respect to plant discrimination while negative human-directed effects are emphasized with respect to arthropods. Focusing on rice varieties, the discrimination criteria used are significantly gastronomic.One implication is that there is a need to broaden our perspective on farmers to admit a view of them as consumers rather than just as producers and to take their gastronomic preferences into account in breeding cultivars that have improved agronomic and market performance. In terms of integrated pest management, there is a need for taking stock of indigenous knowledge before any attempt to supplant it with “scientific” information is initiated. In sum, more serious attention needs to be paid to “ethnoagronomy” and “ethnogastronomy” — cognized models in the spheres of production and consumption — in order to design and promote agricultural recommendations that have a better chance of passing through the preattentive filters and being deliberately considered by farmers for their possible merits. (shrink)

The relations between rationality and optimization have been widely discussed in the wake of Herbert Simon's work, with the common conclusion that the rationality concept does not imply the optimization principle. The paper is partly concerned with adding evidence for this view, but its main, more challenging objective is to question the converse implication from optimization to rationality, which is accepted even by bounded rationality theorists. We discuss three topics in succession: (1) rationally defensible cyclical choices, (2) the revealed preference (...) theory of optimization, and (3) the infinite regress of optimization. We conclude that (1) and (2) provide evidence only for the weak thesis that rationality does not imply optimization. But (3) is seen to deliver a significant argument for the strong thesis that optimization does not imply rationality. (shrink)

The paper examines constraints and preferences employed by people in learning decision rules from preclassified examples. Results from four experiments with human subjects were analyzed and compared with artificial intelligence (AI) inductive learning programs. The results showed the people's rule inductions tended to emphasize category validity (probability of some property, given a category) more than cue validity (probability that an entity is a member of a category given that it has some property) to a greater extent than did the AI (...) programs. Although the relative proportions of different rule types (e.g., conjunctive vs. disjunctive) changed across experiments, a single process model provided a good account of the data from each study. These observations are used to argue for describing constraints in terms of processes embodied in models rather than in terms of products or outputs. Thus AI induction programs become candidate psychological process models and results from inductive learning experiments can suggest new algorithms. More generally, the results show that human inductive generalizations tend toward greater specificity than would be expected if conceptual simplicity were the key constraint on inductions. This bias toward specificity may be due to the fact that this criterion both maximizes inferences that may be drawn from category membership and protects rule induction systems from developing over‐generalizations. (shrink)

In this paper an empirical theory about the nature of intention is sketched. After stressing the necessity of reckoning with intentions in philosophy of action a strategy for deciding empirically between competing theories of intention is exposed and applied for criticizing various philosophical theories of intention, among others that of Bratman. The hypothesis that intentions are optimality beliefs is defended on the basis of empirical decision theory. Present empirical decision theory however does not provide an empirically satisfying elaboration of the (...) desirability concepts used in these optimality beliefs. Based on process theories of deliberation two hypotheses for filling this gap are developed. (shrink)

Research on bounded rationality has two cultures, which I call ‘idealistic’ and ‘pragmatic’. Technically, the cultures differ on whether they build models based on normative axioms or empirical facts, assume that people's goal is to optimize or to satisfice, do not or do model psychological processes, let parameters vary freely or fix them, aim at explanation or prediction and test models from one or both cultures. Each culture tells a story about people's rationality. The story of the idealistic culture is (...) frustrating, with people in principle being able to know what they should do, but in practice systematically failing to do it. This story makes one hide in books for intellectual solace or surrender to the designs of someone smarter. The story of the pragmatic culture is empowering: If people are educated to use the right tool in the right situation, they do well. (shrink)

Conviction Narrative Theory (CNT) is a theory of choice underradical uncertainty– situations where outcomes cannot be enumerated and probabilities cannot be assigned. Whereas most theories of choice assume that people rely on (potentially biased) probabilistic judgments, such theories cannot account for adaptive decision-making when probabilities cannot be assigned. CNT proposes that people usenarratives– structured representations of causal, temporal, analogical, and valence relationships – rather than probabilities, as the currency of thought that unifies our sense-making and decision-making faculties. According to CNT, (...) narratives arise from the interplay between individual cognition and the social environment, with reasoners adopting a narrative that feels “right” to explain the available data; using that narrative to imagine plausible futures; and affectively evaluating those imagined futures to make a choice. Evidence from many areas of the cognitive, behavioral, and social sciences supports this basic model, including lab experiments, interview studies, and econometric analyses. We identify 12 propositions to explain how the mental representations (narratives) interact with four inter-related processes (explanation, simulation, affective evaluation, and communication), examining the theoretical and empirical basis for each. We conclude by discussing how CNT can provide a common vocabulary for researchers studying everyday choices across areas of the decision sciences. (shrink)