Decision Science News

HOW DO PEOPLE MAKE DECISIONS WHEN TIME IS LIMITED, INFORMATION UNRELIABLE, AND THE FUTURE UNCERTAIN?

A new reader on heuristics, Heuristics: The Foundations of Adaptive Behavior, has just been released. Full disclosure, your Decision Science News editor is author on two of the book’s chapters:

CITATION:

Gigerenzer, G., Hertwig, R., & Pachur, T. (Eds.). (2011). Heuristics: The Foundations of Adaptive Behavior. New York: Oxford University Press.

PRECIS:

How do people make decisions when time is limited, information unreliable, and the future uncertain?

Based on the work of Nobel laureate Herbert Simon and with the help of colleagues around the world, the Adaptive Behavior and Cognition (ABC) Group at the Max Planck Institute for Human Development in Berlin has developed a research program on simple heuristics, also known as fast and frugal heuristics. In the social sciences, heuristics have been believed to be generally inferior to complex methods for inference, or even irrational.

Although this may be true in “small worlds” where everything is known for certain, we show that in the actual world in which we live, full of uncertainties and surprises, heuristics are indispensable and often more accurate than complex methods. Contrary to a deeply entrenched belief, complex problems do not necessitate complex computations. Less can be more.  Simple heuristics exploit the information structure of the environment, and thus embody ecological rather than logical rationality.

Simon (1999) applauded this new program as a “revolution in cognitive science, striking a great blow for sanity in the approach to human rationality.” By providing a fresh look at how the mind works as well as the nature of rationality, the simple heuristics program has stimulated a large body of research, led to fascinating applications in diverse fields from law to medicine to business to sports, and instigated controversial debates in psychology, philosophy, and economics.

In a single volume, the present reader compiles key articles that have been published in journals across many disciplines. These articles present theory, real-world applications, and a sample of the large number of existing experimental studies that provide evidence for people’s adaptive use of heuristics.

Review:
“This volume makes a powerful case for the importance of fast and frugal heuristics in explaining a wide range of aspects of cognition. It brings together the latest developments in one of the most influential research programs in the decision sciences, and will provide a valuable stimulus for, and a challenge to, research across the field.”
— Nick Chater, Professor of Cognitive and Decision Sciences, University College London

LINK
Amazon link to: Heuristics: The Foundations of Adaptive Behavior

TABLE OF CONTENTS

Appetizer

1. Homo heuristicus: Why Biased Minds Make Better Inferences.
Gerd Gigerenzer, and Henry Brighton

Part I: Theory

Opening the adaptive toolbox

2. Reasoning the Fast and Frugal Way: Models of Bounded Rationality.
Gerd Gigerenzer, and Daniel G. Goldstein

3. Models of Ecological Rationality: The Recognition Heuristic.
Daniel G. Goldstein and Gerd Gigerenzer

4. How Forgetting Aids Heuristic Inference.
Lael J. Schooler and R. Hertwig

5. Simple Heuristics and Rules of Thumb: Where Psychologists and Behavioral Biologists Might Meet.
John M.C. Hutchinson and Gerd Gigerenzer

6. Naive and Yet Enlightened: From Natural Frequencies to Fast and Frugal Decision Trees.
Laura Martignon, Oliver Vitouch, Masinori Takezawa, and Malcolm R. Forster

7. The Priority Heuristic: Making Choices without Trade-Offs.
Eduard Brandstätter, Gerd Gigerenzer, and Ralph Hertwig

8. One-Reason Decision making: Modeling Violations of Expected Utility Theory.
Konstantinos V. Katsikopoulos and Gerd Gigerenzer

9. The Similarity Heuristic.
Daniel Read and Yael Grushka-Cockayne

10. Hindsight Bias: A By-Product of Knowledge Updating?
Ulrich Hoffrage, Ralph Hertwig, and Gerd Gigerenzer

How are heuristics selected?

11. SSL: A Theory of How People Learn to Select Strategies.
Jörg Rieskamp and Philipp E. Otto

Part II: Tests

When do heuristics work?

12. Fast, Frugal, and Fit: Simple Heuristics for Paired Comparison.
Laura Martignon and Ulrich Hoffrage

13. Heuristic and Linear Models of Judgment: Matching Rules and Environments.
Robin M. Hogarth and Natalia Karelaia

14. Categorization with Limited Resources: A Family of Simple Heuristics.
Laura Martignon, Konstantinos V. Katsikopoulo, and Jan K. Woike

15. A Signal Detection Analysis of the Recognition Heuristic.
Timothy J. Pleskac

16. The Relative Success of Recognition-Based Iinference in Multichoice Decisions.
Rachel McCloy, C. Philip Beaman, and Philip T. Smith

When do people rely on one good reason?

17. The Quest for Take-the-Best.
Arndt Bröder

18. Empirical Tests of a Fast and Frugal Heuristic: Not Everyone “Takes-the-Best.”
Ben R. Newell, Nicola J. Weston, and David R. Shanks

19. A Response-Time Approach to Comparing Generalized Rational and Take-the-Best Models of Decision Making.
F. Bryan Bergert and Robert M. Nosofsky

20. Sequential Processing of Cues in Memory-Based Multi-Attribute Decisions.
Arndt Bröder and Wolfgang Gaissmaier

21. Does Imitation Benefit Cue-OrderLlearning?
Rocio Garcia-Retamero, Masanori Takezawa, and Gerd Gigerenzer

22. The Aging Decision Maker: Cognitive Aging and the Adaptive Selection of Decision Strategies.
Rui Mata, Lael J. Schooler, and Jörg Rieskamp

When do people rely on name recognition?

23. On the Psychology of the Recognition Heuristic: Retrieval Primacy as a Key Determinant of its Use.
Thorsten Pachur and Ralph Hertwig

24. The Recognition Heuristic in Memory-Based Inference: Is Recognition a Non-Compensatory Cue?
Thorsten Pachur, Arndt Bröder, and Julian N. Marewski

25. Why You Think Milan is Larger than Modena: Neural Correlates of the Recognition Heuristic.
Kirsten G. Volz, Lael J. Schooler, Ricarda I. Schubotz, Markus Raab, Gerd Gigerenzer, and D. Yves von Cramon

26. Fluency Heuristic: A Model of How the Mind Exploits a By-Product of Information Retrieval.
Ralph Hertwig, Stefan M. Herzog, Lael J. Schooler, and Torsten Reimer

27. The Use of Recognition in Group Decision Making.
Torsten Reimer and Konstantinos V. Katsikopoulos

Part III: Heuristics in the Wild

Crime

28. Psychological Models of Professional Decision Making.
Mandeep K. Dhami

29. Geographic Profiling: The Fast, Frugal, and Accurate Way.
Brent Snook, Paul J. Taylor, and Craig Bennel

30. Take-the-Best in Expert-Novice Decision Strategies for Residential Burglary.
Rocio Garcia-Retamero and Mandeep K. Dhami

Sports

31. Predicting Wimbledon Tennis Results 2005 by Mere Player Name Recognition.
Benjamin Scheibehenne and Arndt Bröder

32. Heuristics in Sports That Help Ws Win.
W.M. Bennis and Torsten Pachur

33. How Dogs Navigate to Catch Frisbees.
Dennis M. Shaffer, Scott M. Krauchunas, Marianna Eddy, and Michael K. McBeath

Investment

34. Optimal versus Naïve Diversification: How Inefficient is the 1/N Portfolio Strategy?
Victor DeMiguel, Lorenzo Garlappi, and Raman Uppal

35. Parental Investment: How an Equity Motive Can Produce Inequality.
Ralph Hertwig, Jennifer Nerissa Davis, and Frank J. Sulloway

36. Instant Customer Base analysis: Managerial Heuristics Often “Get It Right.”
Markus Wübben and Florian v. Wangenheim

Everyday things

37. Green Defaults: Information Presentation and Pro-Environmental Behavior.
Daniel Pichert and Konstantinois V. Katsikopoulos

38. “If …”: Satisficing Algorithms for Mapping Conditional Statements onto Social Domains.
Alejandro López-Rousseau and Timothy Ketelaar

39. Applying One-Reason Decision Making: The Prioritisation of Literature Searches
Michael D. Lee, Natasha Loughlin, and Ingrid B. Lundberg

40. Aggregate Age-at-Marriage Patterns from Individual Mate-Search Heuristics.
Peter M. Todd, Francesco C. Billari, and Jorge Simão

SUBJECTIVE PROBABILITY, UTILITY, AND DECISION MAKING CONFERENCE (SPUDM) 2011

What: SPUDM23 Conference 21st – 25th August 2011
When: Sunday, August 21, 2011 at 2:00 PM – Thursday, August 25, 2011 at 6:00 PM (GMT)
Where: Kingston University London, Kingston Upon Thames, United Kingdom

Online registration for the SPUDM23 conference in Kingston University London is now OPEN. Please visit: http://spudm23conference.eventbrite.com and select your tickets. Early bird fees will be available until the 15th of June 2011.

Note that, due to logistics restrictions, we are only able to offer 175 tickets for each of the Keynote lectures. We strongly encourage you to register early to secure a seat. Those without tickets will be able to follow the keynote lectures via a live video stream in an adjacent room.

Instructions for poster presentations are also available at:
http://spudm23.eadm.eu/index.php?option=com_content&view=article&id=26&Itemid=100022

2011 CALL FOR ABSTRACTS ANNUAL MEETING OF THE SOCIETY FOR JUDGMENT AND DECISION MAKING

The Society for Judgment and Decision Making (SJDM) invites abstracts for symposia, oral presentations, and posters on any interesting topic related to judgment and decision making. Completed manuscripts are not required.

LOCATION, DATES, AND PROGRAM
SJDM’s annual conference will be held in the Sheraton Seattle Hotel, Seattle, Washington, during November 5-7, 2011. Early registration and welcome reception will take place the evening of Friday, November 4.

Hotel reservations at the $186/night Psychonomic convention rate will be available.

Ed Diener will be the keynote speaker.

SUBMISSIONS
The deadline for submissions is July 1, 2011. Submissions for symposia, oral presentations, and posters should be made through the SJDM website at http://sql.sjdm.org. Technical questions can be addressed to the webmaster at www@sjdm.org. All other questions can be addressed to the program chair, Nathan Novemsky, at nathan.novemsky at yale.edu.

ELIGIBILITY
At least one author of each presentation must be a member of SJDM. Joining at the time of submission will satisfy this requirement. To join, see http://www.sjdm.org/join.html. An individual may submit only one talk (podium presentation) as presenter and only one poster, but may be a co-author on multiple talks and/or posters.

AWARDS

The Best Student Poster Award is given for the best poster presentation whose first author is a student member of SJDM.

The Hillel Einhorn New Investigator Award is intended to encourage outstanding work by new researchers. Applications are due July 1, 2011. Further details are available at http://www.sjdm.org.

The Jane Beattie Memorial Fund subsidizes travel to North America for a foreign scholar in pursuits related to judgment and decision research, including attendance at the annual SJDM meeting. Further details will be available at http://www.sjdm.org.

PROGRAM COMMITTEE
Nathan Novemsky (Chair), Michel Regenwetter, Bernd Figner, Robyn LeBeouf, Gretchen Chapman, Ulf Reips, Wandi Bruine de Bruin, Ellie Kyung, Anuj Shah

Photo credit: http://upload.wikimedia.org/wikipedia/commons/2/24/SeattleMontage.png

JOIN DECISION SCIENCE NEWS IN BOULDER THIS SUMMER

What: Second Annual Boulder Summer Conference on Consumer Financial Decision Making
When: June 26-28, 2011
Where: St. Julien Hotel and Spa, Boulder, Colorado

You are invited JDMers to attend the 2011 Boulder Summer Conference on Consumer Financial Decision Making — to be held at the St. Julien Hotel and Spa in Boulder, Colorado, June 26-28, 2011.

http://leeds.colorado.edu/event/bouldersummerconference#overview
Consumer welfare is strongly affected by household financial decisions large and small: choosing mortgages; saving to fund college education or retirement; using credit cards to fund current consumption; choosing how to “decumulate” savings in retirement; deciding how to pay for health care and insurance; and investing in the stock market. In all of these domains, consumers are often poorly informed and susceptible to making serious errors that have large personal and societal consequences.

The Boulder Summer Conference is truly an exceptional opportunity to discuss cutting edge research on consumer financial decision making by scholars across diverse fields: JDM, economics, psychology, sociology, anthropology, marketing, finance, consumer behavior, social work, and family consumer sciences. We have lively discussion of this research by scholars, regulators, consumer advocates, and financial services professionals. Registration is limited to 120 conference participants.

FINANCIAL ADVISERS AND THE PSYCHOLOGY OF THE ADVISED

Your future self wants you to save, a series of rather labor-intensive studies carried out by Hal Ersner-Hershfield (pictured), Dan Goldstein, and Russ Smith suggest.

Shlomo Benartzi (UCLA), Nick Barberis (Yale), Kent Daniel (Columbia), Dan Goldstein (Yahoo and London Business School), Noah Goldstein (UCLA), John Payne (Duke) and Richard Thaler (Chicago) make up the Academic Advisory Board of the Allianz Global Investors Center for Behavioral Finance. Based on interviews with this set, the Center has released a white paper entitled “Behavioral Finance in Action Psychological challenges in the financial advisor/client relationship, and strategies to solve them“. It is basically advice for financial advisers, written with the conviction that if advisers know more about psychology, they’ll be able to provide better advice.

The paper, available at the Center’s Web site, was recently highlighted in a New York Times article, The Benefits of Telling the Ugly Truth by Jeff Sommer.

LINKS

• NY Times article
• Allianz Global Investors Center for Behavioral Finance
• White paper: Behavioral Finance in Action

DAN ARIELY, JAMES ANDREONI KEYNOTE SPEAKING. DEADLINE JUNE 1, 2011

“If only I could find paper and envelopes to match my skirt and jacket”

(This photo has little to do with behavioral economics,
but that didn’t stop them from using it on the TIBER Web site)

Join Ilja van Beest, Rik Pieters, Jan Potters, Diederik Stapel, and Marcel Zeelenberg in one of DSN’s favorite places this summer as …

You are invited to attend the 10th Tilburg Institute for Behavioral Economics Research (TIBER) symposium on Psychology and Economics, to be held at Tilburg University, August 19th, 2011.

We are happy to announce that Dan Ariely and James Andreoni are confirmed keynote speakers.

We invite contributions from the fields of psychology, economics, and marketing.

If you would like to present your work (in a 20-30 minute talk), please send an abstract (max. 300 words) to tibersymposium@uvt.nl before June 1st, 2011. You are also very much welcome to attend the symposium if you do not present your work.

Further information will soon be available from the website.

EXCELLENT PAY, MODERN INFRASTRUCTURE, STIMULATING DEPARTMENT, WALKING DISTANCE TO FRANCE AND GERMANY

The University of Basel, Switzerland has an very strong psychology department going under dean Ralph Hertwig (DSN has visited to confirm this). If you are looking for a job in the heart of Europe, this is an attractive one.

Not that you should apply for other reasons than intrinsic motivation, but we should mention that Swiss academic salaries are really, really high.

The Department of Psychology of the University of Basel, Switzerland, invites applications for a professorship in social psychology, with the appointment to begin by February 1, 2012.

The successful candidate’s research focus will be in the area of social cognition. Research activities in additional areas – for example, consumer psychology, marketing, or experimental economics – are desirable. The successful candidate will represent social psychology as a core discipline at the bachelor’s and master’s levels with respect to both research and teaching (seminars and lectures may be held in English). At the master’s level, the teaching of social psychology will be coordinated with that of economic psychology and decision science.

Applicants should have demonstrated a high level of academic productivity and applied successfully for research grants. They should further be committed to teaching and to university and departmental administrative service.

Depending on the successful candidate’s qualifications, the position will be filled at the level of full, associate, or assistant professor.

The University of Basel offers attractive terms of employment, a modern infrastructure, and a stimulating scientific environment (www.unibas.ch). Because the University of Basel actively seeks to increase the number of women on its faculty, women are particularly encouraged to apply.

To ensure full consideration, all application materials (CV, teaching statement, and teaching evaluations if available) should be submitted electronically by May 31, 2011 to karin.hettinger@unibas.ch.

For further information, please contact Ralph Hertwig (ralph.hertwig@unibas.ch).

ONE IN TWENTY P = .05 RESULTS IS A FALSE ALARM ON AVERAGE

If you’re not familiar with xkcd and you are a reader of Decision Science News, that’s a source of dissonance in the universe that merits dissolving. Enjoy today’s post (above), and if you are like us, you might want to make the xkcd site one of your default home tabs.

Permanent link to the above comic: http://xkcd.com/882/

HARVARD DECISION SCIENCE LABORATORY 2011-2012 POSTDOC

The Harvard Decision Science Laboratory (HDSL), a university-wide biobehavioral research facility, invites application for a postdoctoral research position from qualified candidates with a recent (or forthcoming) Ph.D. in psychology, behavioral economics, or related fields. The Postdoctoral fellow will serve as a key member of the research team of Professor Jennifer Lerner, faculty director of HDSL, and as a critical resource to researchers working in the lab. In addition, the postdoctoral fellow will work together with HDSL’s executive director in directing a research experience program for undergraduates.

Mastery of experimental methods — encompassing the use of computer-based and web-based experimental modalities — is required. A demonstrated record of research accomplishment involving the use of psychophysiology monitoring systems — including heart rate and heart-rate variability, peripheral blood flow and temperature, blood pressure, respiratory rate, and skin conductance — will make for the strongest candidacy. Familiarity with study protocols utilizing salivary assays for neuroendocrine levels (particularly cortisol and oxytocin), and the use of these measures in experimental psychological science, is also desirable. Knowledge of MediaLab, z-Tree, SPSS, and E-Prime preferred, as well as experience in the experimental use of BioLab(tm) for physiological data collection and analysis. Interest in FACS coding is a plus.

This is a one-year term appointment from July 1, 2011 to June 30, 2012, renewable for another year upon review. The position is open to candidates who have recently earned their Ph.D. Salary and full benefits commensurate with Harvard-wide standards. Applicants should submit a cover letter describing their research interests, a curriculum vitae, up to two reprints (or preprints), and two letters of recommendation to Mark Edington, Executive Director, Harvard Decision Science Laboratory, at mark_edington@harvard.edu. Applications will be reviewed as they are received; fullest consideration will be extended to those received by April 15.

POSTDOCTORAL FELLOW. DYNAMIC DECISION MAKING LAB. CARNEGIE MELLON UNIVERSITY

The Dynamic Decision Making Laboratory (DDMLab) (www.cmu.edu/ddmlab) in the
department of Social and Decision Sciences at Carnegie Mellon University
(CMU) invites applications for Postdoctoral fellowship positions in social
and decisions sciences.

Research projects require experience planning and conducting laboratory
studies with dynamic simulations and decision making games. Fellows will be
involved in a research project aiming at the study of socio-cognitive
aspects of cooperation and conflict, using a combination of behavioral and
computational modeling methods. The ideal candidates will have a Ph.D. in
Psychology, Decision Sciences or Human Factors, and should have broad
research interests in all facets of dynamic decision making research.

Appointment will pay competitive rates based on background and experience.
The position is scheduled to start August 1, 2011 and extend for one or up
to two years.

Applicants should send curriculum vitae, statement of research skills and
interests, relevant journal papers, and three reference letters. Electronic
applications are encouraged. Please send electronic documents (Word, Pdf)
to: coty@cmu.edu or forward paper documents to:

Professor Cleotilde Gonzalez
Dynamic Decision Making Laboratory
Social and Decision Sciences Department
Carnegie Mellon University
5000 Forbes Ave – Porter Hall
Pittsburgh, PA 15213

SOCIETY FOR JUDGMENT AND DECISION MAKING NEWSLETTER

Society for Judgment and Decision Making Newsletter Editor Dan Goldstein reports that the March 2011 SJDM newsletter is ready for download.

http://www.sjdm.org/newsletters/11-mar.pdf

Enjoy!