Analyzing the Role of Cognitive Biases in the Decision-Making Process

275 Pages·2018·2.008 MB·English

by  Verónica Juárez Ramos

Analyzing the Role of
Cognitive Biases in the
Decision-Making Process
Verónica Juárez Ramos
International University of Rioja, Spain
A volume in the Advances in Psychology,
Mental Health, and Behavioral Studies
(APMHBS) Book Series
Published in the United States of America by
IGI Global
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Library of Congress Cataloging-in-Publication Data
Names: Ramos, Veronica Juarez, 1981- editor.
Title: Analyzing the role of cognitive biases in the decision making process
/ Veronica Juarez Ramos, editor.
Description: Hershey : Information Science Reference, [2017]
Identifiers: LCCN 2017012041| ISBN 9781522529781 (hardcover) | ISBN
9781522529798 (ebook)
Subjects: LCSH: Decision making. | Cognition. | Selectivity (Psychology)
Classification: LCC BF448 .A53 2017 | DDC 153--dc23 LC record available at https://lccn.loc.
gov/2017012041

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Behavioral Studies (APMHBS) (ISSN: 2475-6660; eISSN: 2475-6679)
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ISSN:2475-6660
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To my love Daniel for supporting and following me in all the projects I started.
Table of Contents
Preface..................................................................................................................vii
Chapter 1
Decision-Making.Theoretical.Models.and.Cognitive.Biases.................................1
Chapter 2
Cognitive.Biases:.Definition.and.Different.Types................................................27
Chapter 3
Cognitive.Biases.by.Information.Processing........................................................76
Chapter 4
Social.Cognitive.Bias..........................................................................................110
Chapter 5
Personality.Traits.and.Cognitive.Biases.............................................................133
Chapter 6
Cognitive.Biases.in.Clinical.Population.............................................................164
Chapter 7
Jumping.to.Conclusions.Bias..............................................................................188
Chapter 8
Cognitive.Biases:.General.Implications..............................................................214
Chapter 9
Detecting.and.Avoiding.Cognitive.Biases..........................................................236
About the Author..............................................................................................259
Index...................................................................................................................260
vii
Preface
Human beings are the most skilled animal in making decisions or judgments,
but that often arrives to make erroneous decisions or misinterpretations. As
Groucho Marx said, “Who are you going to believe, me or your own eyes?”
If we think about the times which we must have made quick decisions, maybe
we could be reminding them during hours or days. On the one hand, we could
be recalling those wrong decisions. However, on the other hand, we could be
remembering the other ones, that is, quick and effective decisions which we
have often taken and even something which has saved our lives.
Analyzing these decisions surely, we could become aware of our mistakes.
Perhaps in these situations we gave more importance to some aspects than
others, or, we went on ahead to make the decision, even when we did not
have adequate information for taking it, or maybe we were carried along
by different stereotypes and so on. Having said that, one thing is thinking
about our “bad decisions”, but another thing is torturing us for such mistakes
because our brain is not perfect. In fact, our brain is working properly, but it
cannot analyze all information which is available in that moment. Considering
that, if the brain tests all stimuli, it will saturate and as a consequence, we
would be extremely slow taking any decision, and in our world it would be
a great handicap.
Consequently, decision making or making judgments is an essential
function in the ordinary life of any individual. As human beings, constantly,
throughout our lives, we have to decide between different activities
(occupational, recreational, political, economic, family, etc.). These decisions
can be transcendental, for example, when somebody chooses a profession
or if someone wants to get married or no; or inconsequential decisions (e.g.,
deciding how I would take the coffee or if tomorrow I will put on a dress,
trousers, or skirt).
Many times the decisions are made very easily by people, but other times
are difficult to make it because there are doubts about the right decision, or
Preface
the decision causes conflict, or because the context is barely known, that is,
you do not know all the facts or variables and the decision is commanded by
uncertainty or ambiguity. An example which is easy to understand is when
you choose to go to a new Indian restaurant but you have never eaten Indian
food. Therefore, you do not know if you would like the Indian food or not.
Another example would be when a stockbroker chooses to buy or sell some
actions based on an uncertainty or ambiguity context where you do not
have all the available information, only subjective estimates and probability
approximates of the information.
Accordingly, the decision-making process would be a cognitive process
of evaluation and selection inside of a set of options to satisfy a number of
different aims (economic, moral, political, religious, sexual). The classical
theories about decision making which are based on economic theories show
human beings as rational beings to thoroughly evaluate the different options
before making a choice. For instance, when we are playing poker game, we
should calculate the diverse possibilities to win. It is something basic, if you
do not want to lose.
Thus, scientists who study decision making process have created different
approaches in order to explain how work (see Chapter 1). In spite of these
multitude of different models which try to explain the decision-making
process, there are several gaps in their explanations. For example, in general
these models see human being as rational being that considers all variables
to reach any decision. However, it is impossible that people always take into
account all information and calculate the different values for each alternative
of the situation. For this reason, Kahneman and Tervsky (1972) postulated a
new decision-making theory because of the before models could not explain
these cases, that is, those decisions where it is impossible analyze all variables,
Bayesian inferences, algorithms… etcetera. These authors suggested that many
decisions could be carried out by heuristics and cognitive bias. This type of
decisions, which are influenced by heuristic and bias, are performed above
all in decision making under uncertainty or ambiguous situations because
in these case is not possible carrying out all possible mathematical analysis.
Then, people sometimes have a total certainty, that is, the total available
information but other times, they have not the whole information so there is
uncertainty information, and they still need to take the decision. Even they
could make a decision without having any decisions. Imagine our ancestors
who made quick decisions to survive when they were attacked by animals, or
had to confront natural disasters. They did not dispose of knowledge or great
information but they still had to make quicker decisions if they would want
viii
Preface
to live. This phenomenon could be extrapolated to the present day because
nowadays everyone also needs to make fast decisions to live or rather to
survive. And it is here where the cognitive biases have its importance because
in this type of decision they usually display.
In addition, these biases are very consistent in each of us which these lead us
to make mistakes repeatedly, so they have a high predictive value of behavior
to follow. As it is said “the man is the unique animal which stumbles twice”.
Hence, the cognitive bias would be a pattern of deviation in judgment, in
which the inferences we make about other people and/or situations can be
illogical (Haselton, Nettle, & Andrews, 2015). In fact, these biases would
be influenced by several factors like contextual, motivational, and social
among others. Some biases are probably adaptive and beneficial, for instance,
because these carry out to more effective actions in given contexts or enable
faster decisions, when faster decisions are of greater value for reproductive
success and survival. Imagine one situation where you can be attacked by a
wild and dangerous animal.
In this situation any individual must react and reach decisions quickly.
Other instance of current adaptive bias could be one situation where you
have arrived to home and have found that the door is opened, so probably
you could think that a stranger has gone into your home. However, if you
analyze the diverse probabilities of different options, you will realize that
the most probable is that you have left the door opened.
In spite of the deduction which you believe that one stranger has gone into
in your home is not the most likely, if it is the most effective and adaptive
because that alerts us to a potential hazard. On the other hand, another
biases probably are caused by a general failure in our brain structure or the
misapplication of a mechanism that is beneficial under different circumstances.
In fact, these biases can lead anybody to a perceptual distortion, making an
inaccurate judgment, or an illogical interpretation.
On account of this cognitive biases allow us to make a quick decision
when the most important thing is not the accuracy. Therefore, many times
cognitive shortcuts, which are made through intuitive reasoning based on
previous experience or acquired knowledge, lead us to make a right and fast
decision and other times a wrong decision.
These cognitive biases which are produced by cognitive factors partly
reveal how is produced the decision-making process, that is, which are its
limitations, its priorities…etc. In general, it can say that the cognitive biases
can be simply produced by the limitations of information processing in the
ix