How, and how well, do people switch between exploration and exploitation to search for and accumulate resources? We study the decision processes underlying such exploration/exploitation trade‐offs using a novel card selection task that captures the common situation of searching among multiple resources (e.g., jobs) that can be exploited without depleting. With experience, participants learn to switch appropriately between exploration and exploitation and approach optimal performance. We model participants' behavior on this task with random, threshold, and sampling strategies, and find that (...) a linear decreasing threshold rule best fits participants' results. Further evidence that participants use decreasing threshold‐based strategies comes from reaction time differences between exploration and exploitation; however, participants themselves report non‐decreasing thresholds. Decreasing threshold strategies that “front‐load” exploration and switch quickly to exploitation are particularly effective in resource accumulation tasks, in contrast to optimal stopping problems like the Secretary Problem requiring longer exploration. (shrink)

The statistics of small samples are often quite different from those of large samples, and this needs to be taken into account in assessing the rationality of human behavior. Specifically, in evaluating human responses to environmental statistics, it is the effective environment that matters; that is, the environment actually experienced by the agent needs to be considered, not simply long‐run frequencies. Significant deviations from long‐run statistics may arise through experiential limitations of the agent that stem from resource constraints and/or information‐processing (...) bounds. The article draws together recent work from a number of areas in judgment and decision making ranging from randomness perception (Hahn & Warren, ), information sampling (Hertwig & Pleskac, ; Kareev et al., ), and consequences of choice for exploration or exploitation (e.g., Denrell, ) to demonstrate how proper consideration of these deviations leads to reevaluation of behaviors that are otherwise deemed irrational. (shrink)

This study examined students' reasoning about simple repeated choices. Each choice involved ''betting'' on two events, differing in probability. We asked subjects to generate or evaluate alternative strategies such as betting on the most likely event on every trial, betting on it on almost every trial, or employing a ''probability matching'' strategy. Almost half of the college students did not generate or rank strategies according to their expected value, but few subjects preferred a strategy of strict probability matching. High-school students (...) showed greater deviations from expected value than college students. Similar misunderstandings were observed in a choice task involving real (not hypothetical) repeated trials. Large gender differences in prediction strategies and in related computational skills were observed. Subjects who understand the optimal strategy usually do so in terms of independence of successive trials rather than calculation. Some subjects understand the concept of independence but fail to bring it to bear, thinking it can be overridden by intuition or local balancing (representativeness). (shrink)

A working assumption that processes of natural and cultural evolution have tailored the mind to fit the demands and structure of its environment begs the question: how are we to characterize the structure of cognitive environments? Decision problems faced by real organisms are not like simple multiple-choice examination papers. For example, some individual problems may occur much more frequently than others, whilst some may carry much more weight than others. Such considerations are not taken into account when (i) the performance (...) of candidate cognitive mechanisms is assessed by employing a simple accuracy metric that is insensitive to the structure of the decision-maker's environment, and (ii) reason is defined as the adherence to internalist prescriptions of classical rationality. Here we explore the impact of frequency and significance structure on the performance of a range of candidate decision-making mechanisms. We show that the character of this impact is complex, since structured environments demand that decision-makers trade off general performance against performance on important subsets of test items. As a result, environment structure obviates internalist criteria of rationality. Failing to appreciate the role of environment structure in shaping cognition can lead to mischaracterising adaptive behavior as irrational. (shrink)