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Publications in Decision Making by NOMIS researchers

Allocative Skill

NOMIS Researcher(s)

Published in

September 1, 2023

Jobs increasingly require good decision-making. Workers are valued not only for how much they can do, but also for their ability to decide what to do. In this paper we develop a theory and measurement paradigm for assessing individual variation in the ability to make good decisions about resource allocation, which we call allocative skill. We begin with a model where agents strategically acquire information about factor productivity under time and effort constraints. Conditional on such constraints, agents’ allocative skill can be defined as the marginal product of their attention. We test our model in a field survey where participants act as managers assigning fictional workers with heterogeneous productivity schedules to job tasks and are paid in proportion to output. Allocative skill strongly predicts full-time labor earnings, even conditional on IQ, numeracy, and education, and the return to allocative skill is greater in decision-intensive occupations.

Research field(s)
Economics

DOI
10.3386/w31674

Comparing Human Predictions from Expert Advice to On-line Optimization Algorithms

NOMIS Researcher(s)

Published in

August 1, 2023

On-line decision problems – in which a decision is made based on a sequence of past events without knowledge of the future – have been extensively studied in theoretical computer science. A famous example is the Prediction from Expert Advice problem, in which an agent has to make a decision informed by the predictions of a set of experts. An optimal solution to this problem is the Multiplicative Weights Update Method (MWUM). In this paper, we investigate how humans behave in a Prediction from Expert Advice task. We compare MWUM and several other algorithms proposed in the computer science literature against human behavior. We find that MWUM provides the best fit to people’s choices.

Research field(s)
Psychology & Cognitive Sciences

To each their own theory: Exploring the limits of individual differences in decisions under risk

NOMIS Researcher(s)

August 1, 2023

Theories in cognitive science are primarily aimed at explaining human behavior in general, appealing to universal constructs such as perception or attention. When it is considered, modeling of individual differences is typically performed by adapting model parameters. The implicit assumption of this standard approach is that people are relatively similar, employing the same basic cognitive processes in a given problem domain. In this work, we consider a broader evaluation of the way in which people may differ. We evaluate 23 models of risky choice on around 300 individuals, and find that most models—spanning various constructs from heuristic rules and attention to regret and subjective perception—explain the behavior of different subpopulations of individuals. These results may account for part of the difficulty in obtaining a single elegant explanation of behavior in some long-studied domains, and suggest a more serious consideration of individual variability in theory comparisons going forward.

Research field(s)
Psychology & Cognitive Sciences

Peripheral Visual Information Halves Attentional Choice Biases

NOMIS Researcher(s)

Published in

July 20, 2023

A growing body of research has shown that simple choices involve the construction and comparison of values at the time of decision. These processes are modulated by attention in a way that leaves decision makers susceptible to attentional biases. Here, we studied the role of peripheral visual information on the choice process and on attentional choice biases. We used an eye-tracking experiment in which participants (N = 50 adults) made binary choices between food items that were displayed in marked screen “shelves” in two conditions: (a) where both items were displayed, and (b) where items were displayed only when participants fixated within their shelves. We found that removing the nonfixated option approximately doubled the size of the attentional biases. The results show that peripheral visual information is crucial in facilitating good decisions and suggest that individuals might be influenceable by settings in which only one item is shown at a time, such as e-commerce. © The Author(s) 2023.

Research field(s)
Health Sciences, Psychology & Cognitive Sciences, Experimental Psychology

DOI
10.1177/09567976231184878

Does decision confidence reflect effort?

NOMIS Researcher(s)

Published in

February 16, 2023

Goal directed behaviour requires transformation of sensory input to decision, and then to output action. How the sensory input is accumulated to form the decision has been extensively studied, however, the influence of output action on decision making has been largely dismissed. Although the recent emerging view postulates the reciprocal interaction between action and decision, still little is known about how the parameters of an action modulates the decision. In this study, we focused on the physical effort which necessarily entails with action. We tested if the physical effort during the deliberation period of the perceptual decision, not the effort required after deciding a particular option, can impact on the process of forming the decision. Here, we set up an experimental situation where investing effort is necessary for the initiation of the task, but importantly, is orthogonal to success in task performance. The study was pre-registered to test the hypothesis that the increased effort will decrease the metacognitive accuracy of decision, without affecting the decision accuracy. Participants judged the direction of a random-dot motion stimuli, while holding and maintaining the position of a robotic manipulandum with their right hand. In the key experimental condition, the manipulandum produced force to move away from its position, requiring the participants to resist the force while accumulating the sensory evidence for the decision. The decision was reported by a key-press using the left-hand. We found no evidence that such incidental (i.e., non-instrumental) effort may influence the subsequent decision process and most importantly decision confidence. The possible reason for this result and the future direction of the research are discussed. © 2023 Hagura et al. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Research field(s)
Health Sciences, Psychology & Cognitive Sciences, Experimental Psychology

DOI
10.1371/journal.pone.0278617

Part-Time Bayesians: Incentives and Behavioral Heterogeneity in Belief Updating

NOMIS Researcher(s)

Published in

January 4, 2023

Decisions in management and finance rely on information that often includes win-lose feedback (e.g., gains and losses, success and failure). Simple reinforcement then suggests to blindly repeat choices if they led to success in the past and change them otherwise, which might conflict with Bayesian updating of beliefs. We use finite mixture models and hidden Markov models, adapted from machine learning, to uncover behavioral heterogeneity in the reliance on difference behavioral rules across and within individuals in a belief-updating experiment. Most decision makers rely both on Bayesian updating and reinforcement. Paradoxically, an increase in incentives increases the reliance on reinforcement because the win-lose cues become more salient.

DOI
10.1287/mnsc.2022.4584

Social Metacognition Drives Willingness to Commit

NOMIS Researcher(s)

Published in

January 1, 2023

Showing or telling others that we are committed to cooperate with them can boost social cooperation. But what makes us willing to signal our cooperativeness, when it is costly to do so? In two experiments,we tested the hypothesis that agents engage in social commitments if their subjective confidence in predicting the interaction partner’s behavior is low. In Experiment 1 (preregistered), 48 participants played a prisoner’s dilemma game where they could signal their intentions to their co-player by enduring a monetary cost. As hypothesized, low confidence in one’s prediction of the co-player’s intentions was associated with a higher willingness to engage in costly commitment. In Experiment 2 (31 participants), we replicate these findings and moreover provide causal evidence that experimentally lowering the predictability of others’ actions (and thereby confidence in these predictions) motivates commitment decisions. Finally, across both experiments, we show that participants possess and demonstrate metacognitive access to the accuracy of their mentalizing processes. Taken together, our findings shed light on the importance of confidence representations and metacognitive processes in social interactions © 2023 American Psychological Association

Research field(s)
Applied Sciences, Information & Communication Technologies, Artificial Intelligence & Image Processing

DOI
10.1037/xge0001419

The role of anticipated regret in choosing for others

NOMIS Researcher(s)

Published in

December 1, 2021

In everyday life, people sometimes find themselves making decisions on behalf of others, taking risks on another’s behalf, accepting the responsibility for these choices and possibly suffering regret for what they could have done differently. Previous research has extensively studied how people deal with risk when making decisions for others or when being observed by others. Here, we asked whether making decisions for present others is affected by regret avoidance. We studied value-based decision making under uncertainty, manipulating both whether decisions benefited the participant or a partner (beneficiary effect) and whether the partner watched the participant’s choices (audience effect) and their factual and counterfactual outcomes. Computational behavioural analysis revealed that participants were less mindful of regret (and more strongly driven by bigger risks) when choosing for others vs for themselves. Conversely, they chose more conservatively (regarding both regret and risk) when being watched vs alone. The effects of beneficiary and audience on anticipated regret counteracted each other, suggesting that participants’ financial and reputational interests impacted the feeling of regret independently.

Research field(s)
Health Sciences, Psychology & Cognitive Sciences, Social Psychology

DOI
10.1038/s41598-021-91635-z

Does choice change preferences? An incentivized test of the mere choice effect

NOMIS Researcher(s)

Published in

August 15, 2021

Widespread evidence from psychology and neuroscience documents that previous choices unconditionally increase the later desirability of chosen objects, even if those choices were uninformative. This is problematic for economists who use choice data to estimate latent preferences, demand functions, and social welfare. The evidence on this mere choice effect, however, exhibits serious shortcomings which prevent evaluating its possible relevance for economics. In this paper, we present a novel, parsimonious experimental design to test for the economic validity of the mere choice effect addressing these shortcomings. Our design uses well-defined, monetary lotteries, all decisions are incentivized, and we effectively randomize participants’ initial choices without relying on deception. Results from a large, pre-registered online experiment find no support for the mere choice effect. Our results challenge conventional wisdom outside economics. The mere choice effect does not seem to be a concern for economics, at least in the domain of decision making under risk.

Research field(s)
Psychology & Cognitive Sciences

DOI
10.1007/s10683-021-09728-5

Joining a group diverts regret and responsibility away from the individual

NOMIS Researcher(s)

Published in

March 11, 2020

It has recently been proposed that a key motivation for joining groups is the protection from the negative consequences of undesirable outcomes. To test this claim, we investigated how experienced outcomes triggering loss and regret impacted people’s tendency to decide alone or join a group, and how decisions differed when voluntarily made alone versus in group. Replicated across two experiments, participants (n = 125 and n = 496) selected whether to play alone or contribute their vote to a group decision. Next, they chose between two lotteries with different probabilities of winning and losing. The higher the negative outcome, the more participants switched from deciding alone to with others. When joining a group to choose the lottery, choices were less driven by outcome and regret anticipation. Moreover, negative outcomes experienced alone, not part of a group vote, led to worse subsequent choices than positive outcomes. These results suggest that the protective shield of the collective reduces the influence of negative emotions that may help individuals re-evaluate past choices.

Research field(s)
Natural Sciences, Biology, Evolutionary Biology

DOI
10.1098/rspb.2019.2251

Shared responsibility in collective decisions

NOMIS Researcher(s)

Published in

June 1, 2019

Research investigating collective decision-making has focused primarily on the improvement of accuracy in collective decisions and less on the motives that drive individuals to make these decisions. We argue that a strong but neglected motive for making collective decisions is minimizing the material and psychological burden of an individual’s responsibility. Making difficult decisions with others shields individuals from the consequences of negative outcomes by reducing regret, punishment and stress. Considering shared responsibility as a another key motivation to join groups helps understand behaviours with societal implications such as political voting, committing norm violations, predicting natural disasters and making health-related decisions.

Research field(s)
Health Sciences, Psychology & Cognitive Sciences, Experimental Psychology

DOI
10.1038/s41562-019-0596-4

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