This week there wasn't a lecture. We have been reading up on our group subject which is Decisions from experience.
At some point next Friday we will be putting all of our ideas together, making it into a powerpoint presentation.
The paper we were reading for the power point presentation was 'Decisions From Experience and the Effect of Rare Events in Risky Choice' by Hertwig et al. (2004). This paper was rather short. They conducted a study at a university in Israel, presenting students with six decision problems. For example problem 1 was a choice between an 80% chance of getting $4 or $3 for certain. Half of the participants were put in to the experience group where they were allowed to make decisions from their experience, which meant they were able to see the problems described on the computer screen. The other half were in the experience group, they only saw two buttons on the computer screen and were told that each button was associated with a payoff distribution.
Hertwig et al. found that more participants in the description group chose the option with the higher expected value (H) compared with the experience group.
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Have you got any thoughts about the material you've been reading?
ReplyDeleteWhilst I was reading the paper, I was wondering if their choices would have been completely different if the amount of money was higher. The fact that the amount of money they were offered was quite low, might have meant for some people; whatever they got as an outcome wasn't that important, and maybe didn't care very much. Where as if they were offered a higher sum their decisions may have been different.
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