In psychology, decision making is regarded as the cognitive process resulting in the selection of a belief or a course of action among several possible alternative options.It could be either rational or irrational
Decision making model
Rational decision-making model
①Define the problem
②Identify the decision criteria
③Allocate weights to the criteria
④Develop the alternatives
⑤Evaluate the alternatives
⑥Select the best alternatives
Bounded rationality
The limted information-processing capability of human beings makes it impossible to assimilate and understand all the information necessary to optimize.So people seek solutions that are satisfactory and acceptable,rather than optimal.
Intuitive decision making
An non-conscious process created out of distilled experience
Based on years of experience and learning
Can be a powerful complement to rational analysis in decision making.
Common biases and errors in decision making
Overconfidence Bias
As manager and employees become more knowledgeable about an issue, the less likely they are to display overconfidence.
Anchoring Bias
A tendency to fixate on initial information and fail to adequately adjust for subsequent information
Confirmation Bias
Seeking out information that reffirms our past choices and discounting information that contradicts past judgments.
Availability Bias
The tendency to base judgments on information that is readily avilable
Escalation of commitment
Staying with a decision even when there is clear evidence that it is wrong
Risk Aversion
Peferring a sure thing over a risky thing.
Hindsight Bias
The tendency to believe falsely that we could have accurately predicted the outcome of an event after that outcome is already known.
Randomness Error
People tend to think they can predict the outcome of random events.
Three ethical decision criteria
Utilitaribanism
Provide the greatest good for the greatest number
The basic idea is to maximize utility
Rights
whistel-blower
make decisions consistent with fundamental liberties and privileges
Justice
impose and enforce rules fairly and impartially so that there is equal distribution of benefits and costs.
Attribution
Defination
It is the process by which individuals explain the causes of behavior
Errors or Biases distort Attributions
Fundamental Attribution Error
The tendency to underestimate the influence of external factors and overestimate that of internal factors.
Self-serving basis
Tend to attribute their own sucesses to internal factors such as ability or effort, while putting the blame for failure on external factors such as bad luck or unproductive co-workers.
Attribution theory
models to describe and explain the process of attribution
Shortcuts in social perception
selective perception
A perceptual filtering process based on interest, backgroung and attitude.May allow observers to draw unwarranted conclusions from an ambiguous situation
halo effect
drawing a general impression based on a single characteristic
constrast effectes
our reaction is influenced by others we have recentlu encountered(the contact of observation)
stereotyping
judging someone on the basis of the perception of the group to which they belong
primary effect
It refers to that the initial information of the perceiver has a strong influence on the formation of perception
recency effect
It refers to in the process of forming the overall impression. A phenomenon in which newly acquired information has a greater impact than previously acquired information
Projection effect
Explain the behavior of others with their own characteristics
