DECISION MAKING

Decision Making

Decision Making

In this research paper we are going to discuss that “Are human decisions optimal?” In our daily life, we have to make a different decision, some times we make the optimal decision and sometimes we make the worst possible decision. We consider many things while making a decision. The decision making result depends on the individual's experience, education and many other factors.

Another question about decision processing is whether there are individual differences between people in their susceptibility to erroneous decision making. For example, do some people tend to inappropriately use the heuristics outlined above, and if so, is there a factor that accounts for that inappropriate use?

Stanovich and West (1998) had participants do different judgment tasks and related the performance on those tasks to assessments of cognitive ability and thinking styles. They found that cognitive capacity does account for some performance on some judgment tasks, which suggests that computational limitations could be a partial explanation of non-normative responding (i.e., judgment errors). Also, independent of cognitive ability, thinking styles accounted for some of the participants' performance on some judgment tasks.

A similar suggestion is that some erroneous judgments are the result of participants' conversational ability. For example, Slugoski and Wilson (1998) show that six errors in social judgment are related to people's conversational skills. They suggest that judgment errors may not be errors, because participants may be interpreting the information presented to them differently than the researcher intends (see also Hilton and Slugoski 1999).

Finally, experience affects the decision-making ability. Nisbett, Krantz, Jepson, and Kunda (1983) found that participants with experience in the domain in question preferred explanations that reflected statistical inferences. Similarly, Fong, Krantz, and Nisbett (1986) found that statistical explanations were used more often by people with more statistical training. These results suggest that decision-making ability can improve through relevant domain experience, as well as through statistical training that is not domain specific.

In our life sometime we have to make a group decision making that the decision result depends how well we are cooperating with each other within the group.

Social Dilemmas. Social dilemmas occur when the goals of individuals conflict with the goals of their group; individuals face the dilemma of choosing between doing what is best for them personally and what is best for the group as a whole (Lopes 1994). The tragedy was that individuals tried to maximize what they could get from the common and, or the "commons," which resulted in the commons being overused, thereby becoming depleted. If each individual had only used his allotted share of the commons, then it would have continued to be available to everyone.

Prisoner's Dilemma. The best-known social dilemma is the prisoner's dilemma (PD), which involves two individuals (most often, although formulations with more than two people are possible). The original PD involved two convicts' decision whether or not to confess to a crime (Rapoport and Chammah 1965). But the following example is functionally equivalent.

Imagine you are selling an item to another person, but you cannot meet to ...