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How to Change the Weight of Rare Events in Decisions from Experience

Hotaling, J., Jarvstad, A. ORCID: 0000-0002-3175-8733, Donkin, C. and Ben, N. (2019). How to Change the Weight of Rare Events in Decisions from Experience. Psychological Science, doi: 10.1177/0956797619884324

Abstract

When making risky choices, two kinds of information are crucial: outcome values and outcome probabilities. Here, we demonstrate that the juncture at which value and probability information is provided has a fundamental effect on choice. Across four experiments involving 489 participants, we compare two decision making scenarios: one where value information is revealed during sampling (Standard), and one where value information is revealed after sampling (Value-Ignorance). On average, participants made riskier choices when value information was provided after sampling. Moreover, parameter estimates from a hierarchical Bayesian implementation of cumulative prospect theory suggested that participants overweighted rare events when value information was absent during sampling, but showed no overweighting in the Standard condition. This suggests that the impact of rare events on choice relies crucially on the timing of probability and value integration. We provide paths towards mechanistic explanations of our results based on frameworks which assume different underlying cognitive architectures.

Publication Type: Article
Additional Information: Hotaling, J., Jarvstad, A. , Donkin, C. and Ben, N. (2019). How to Change the Weight of Rare Events in Decisions from Experience. Psychological Science, © Copyright, The Author(s), 2019. DOI: 10.1177/0956797619884324.
Publisher Keywords: decisions from experience, description-experience gap, decision making, sampling, cumulative prospect theory; hierarchical Bayesian modeling
Subjects: B Philosophy. Psychology. Religion > BF Psychology
Departments: School of Arts & Social Sciences > Psychology
URI: https://openaccess.city.ac.uk/id/eprint/22647
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