To the cognitive aspects of the decion making process

1 define the problem; 2 identify the criteria; 3 weight the criteria; 4 generate the alternatives; 5 rate eacht alternative on each criterion; 6 compute the optimal decision

Refers to our intuitive system, which is typically fast, automatic, effortless, implicit and emotional

System 1 thinking

Refers to reasoning that is slower, conscious, effortful, ecplicit, and logical

but System 2 logic should preferably influence our most important decisions

the study of prescriptive models and the study of descriptive models

descriptive decision researchers consider how decisions are actually made

rather than examining all possible alternatives, we simply search until we find a satisfactory solution that will suffice because it achieves an acceptable level of performance

heuristics

people asses the frequency, probability, or likely causes of an event by the degree to which instances or occurrences of that event are readily "available" in memory.

when making a judgment about an individual (or object or event), people tend to look for traits an individual may have that correspond with previously formed stereotypes.

there are always at least four separate situations to consider when assessing the association between two events, assuming that each one has just two possible outcomes. however, our everyday decision making commonly neglects this fact. Instead, we intuitively use selective data when testing hypotheses.

in which we search for and interpret evidence in a way that supports the conclusions we favored at the outset

in which some irrelevant initial hypothesis or starting point holds undue sway over our judgments

leading us to believe too strongly in the accuracy of our own beliefs

in which we too quickly dismiss, in retrospect, the possibility that things could have turned out differentlu

most of our judgments are evoked by an affective, or emotional, evaluation that occurs even before any higher-level reasoning takes place.

is all the more likely to be used when people are busy or under time constraints.

the fact that legal awards are highly predicted by the jury's affective outrage at the defendant's behavior, rather than simply by logical reasoning about the harm created by the defendant.

1. Something that pops up in your mind is the most likely choice
2. Thoughts are structured in a particular way

1. Not the complete case is being observed
2. The focus is on (personal) features that have nothing to do with the real answer
3. The sample size, chances and regression is not viewed

1. People are not trying to falsify, eventhough this is necessary.
2. Anchoring
3. Overestimating their judgment
4. People do not use all the information they got

what is optimal decision making?

how are decisions actually made>

People assess the frequency, probability, or likely causes of an event by the degree to which instances or occurences of that event are readily "available"in the memory.

assessing the likelihood of A by the degree to which A is representative of B, that is, resembles B

we intuitively use selective data when testing hypotheses

most of our judgments are evoked by an affective, or emotional, evaluation that occurs even before any higher-level reasoning takes place

outcomes are expressed in objective units

subjective value

individuals judge events that are more easily recalled from memory, based on vividness or recency, to be more numerous than events of equal frequency whose instances are less easily recalled

individuals are biased in their assessments of the frequency of events based on how their memory structures affect the search process

when assessing the likelihood of events, individuals tend to ignore base rates if any other descriptive information is provided - even if it is irrelevant

when assessing the reliability of sample information, individuals frequently fail to appreciate the role of sample size

individuals expect that a sequence of data generated by a random process will look "random", even when the sequence is too short for those expectations to be statistically valid

individuals tend to ignore the fact that extreme events tend to regress to the mean on subsequent trials

individuals falsely judge that conjunctions (two events co-occurring) are more probable than a more global set of occurrences of which the conjunctions is a subset

individuals tend to seek confirmatory information for what they think is true and fail to search for disconfirmatory evidence

individuals make estimates for values based upon an initial value (derived from past events, random assignment, or whatever information is available) and typically make insufficient adjustments from that anchor when establishing  a final value

individuals exhibit a bias toward overestimating the probability of conjunctive events and underestimating the probability of disjunctive events 

individuals tend to be overconfident of the infallibility of their judgments when answering moderately to extremely difficult questions

after finding out whether or not an event occurred, individuals tend to overestimate the degree to which they would have predicted the correct outcome. Furthermore, individuals fail to ignore information they possess that other do not when predicting other's behavior