PSY 556 1st Edition Lecture 15Outline of Last LectureI. AggressionOutline of Current Lecture I. Judgment and Decision MakingII. Heuristics and BiasesCurrent LectureIII. Biases in judgment and decision makinga. There are basic biases in our everyday judgment and decision-makingb. If we don’t know about these biases, how can we correct for them?i. And we don’t appreciate that they will guide the decisions of othersIV. Prospect Theory (1979)a. zero point is psychologically importanti. reference point mattersii. gain and losses not mirror imagesb. slope on negative side (left) is steeper than the slope on the positive side (right)i. going 1 unit left moves you further down than moving 1 unit right moves you upii. losses have bigger psychological impact than gainsiii. slope is steeper closer to zero than further away in either direction1. going from 0 to -1 is worse than from -1 to -22. Stalin: 1 death is a tragedy; 100 is a statisticc. Subjective Value & Riski. When we think of gains, we are risk averseii. When we think of losses, we are risk seekingd. Why are we built this way?i. Positives and negatives aren’t the same in terms of survival1. Positive: Its OK to miss one opportunity for food2. Negative: miss one predator and you are foodii. Over-value negatives in the systemiii. Over-value small changes that suggest new qualitative difference in environment1. From 0 to 1 tiger is a qualitative change2. From 1 to 2 tigers is a quantitative changeThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.iv. Gains vs. losses are not always structured the same way for survivalv. For example, men and women have different mate value payoff structuresvi. Error management theoryV. Heuristics and biasesa. Availabilityi. Are you more likely to die from a shark attack or falling airplane parts?ii. You are 30 times more likely to die from falling airplane partsiii. Cognitions that are more available/accessible/vivid in memory are estimated as occurring more frequentlyiv. Why does this make sense?1. Frequent experiences will be more accessible2. BUT so will non-frequent vivid ones!a. We ignore that second possibilityb. Representativeness Heuristici. Law of Small Numbers1. I have just flipped a coin 5 times and it came up Heads each of the first 4 flips. What most likely came up on the 5th?ii. Neglecting Base Rates1. Subjects estimates didn’t change across the different base rateconditionsiii. Conjunction Fallacyiv. **Using subjective similarity between observation and an expected profile or pattern, while ignoring other statistical informationc. Anchor and Adjustmenti. Maybe should be called “anchor and failure to adjust”ii. Start with an anchor of either 750 or 3750 miles and adjust insufficientlyiii. Hindsight Bias (1975)1. The “knew it all along” bias2. Cannot help but use your current knowledge to anchor how you think you would have answered it.3. New knowledge becomes an anchor, then you adjust, thinking,“Well, I would not have gotten it exactly right without this knowledge”4. Partly explains why others seem stupid when they don’t know what we know5. We believe we should have figured it out even without the knowledged. Relation to social biasesi. Naïve realism – availability heuristic1. My perspective is much more available than yoursii. Stereotyping – representativeness heuristiciii. Fundamental Attribution Error – Anchor and Adjustment Bias1. Also – hindsight biasiv. Forgetting cognitive dissonance reduction1. Anchor on current attitude when asked about old one, adjust (insufficiently) on naïve theorye. Why do we have these biases?i. They simplify our world1. There is an overwhelming amount of information we could consider for any decision2. Heuristics are simple “rules of thumb”3. rule of thumb = (1 = King’s top of thumb) – not entirely accurate, but…4. useful and good enough most of the timea. compare to visual