Chapter

A decision-by-sampling account of decision under risk

Neil Stewart and Keith Simpson

in The Probabilistic Mind:

Published in print March 2008 | ISBN: 9780199216093
Published online March 2012 | e-ISBN: 9780191695971 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199216093.003.0012
A decision-by-sampling account of decision under risk

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This chapter outlines a possible extension of Stewart et al.'s (2006) decision by sampling theory, to account for how people integrate probability and value information in considering ‘gambles’. The resulting account provides a theory of decision-under-risk that is directly comparable to prospect theory (Kahneman & Tversky,1979) and its competitors (e.g. Brandstatter et al. 2006). The model correctly predicts the direction of preference for all 16 prospects from the Kahneman and Tversky (1979) data set and produces a high correlation between choice proportions and model predictions.

Keywords: sampling theory; probability; value information; gambles; prospect theory; choice proportions; model predictions

Chapter.  5828 words.  Illustrated.

Subjects: Cognitive Psychology

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