Probability Matching
A decision-making strategy where individuals allocate resources proportionally to the probability of an outcome occurring, rather than optimizing the most likely outcome.
235 topics found for
“decision-making process”
Representativeness
Representativeness is a heuristic in decision-making where individuals judge the probability of an event based on how much it resembles a typical case.
Allais Paradox
A decision-making paradox that shows people's preferences can violate the expected utility theory, highlighting irrational behavior.
Base Rate Fallacy
A cognitive bias where people ignore general statistical information in favor of specific information.
Ambiguity Effect
A cognitive bias where decision-making is affected by the lack of information or uncertainty.
Sunk Cost Fallacy
The tendency for individuals to continue a behavior or endeavor as a result of previously invested resources (time, money, or effort) rather than future potential benefits.
Irrational Escalation
The phenomenon where people continue a failing course of action due to the amount of resources already invested.
Availability Bias
A cognitive bias where people overestimate the importance of information that is readily available.
Dual Self Model
A behavioral economics model that explains decision-making as a conflict between a present-oriented "doer" and a future-oriented "planner".