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Judgement & Decision-making (Biases (Overconfidence Bias (Illusion of…
Judgement & Decision-making
Attribution
When we observe an event or behaviour, we want to determine whether it is caused by internal factors (personality) or by external factors (situation,social pressure)
Consensus
- Does the individual act the same way toward other people
Consistency
- Does the individual act the same way over time
Distinctiveness
- Does individual act the same way across different situation?
Correspondence Bias
- When explaining other people's behaviours, we tend to attribute more to internal factors than to external factors
Perception
Receiving and making sense of information from the environment
Existing knowledge
Emotions
Goals & Needs
Social Identity Theory
Halo Effect
Drawing a general impression about an individual based on a single characteristic ( physical attractiveness )
Social Prototype
We automatically fill in information about someone based on our simplified understanding of the social group that this person belongs to
Biases
Anchoring Bias
- the common human tendency to rely too heavily, or "anchor," on one trait or piece of information when making decisions.
Self-serving bias
- We make judgements in ways that benifit ourselves ( we tend to believe that we have contributed more to the teamwork than we actually have)
Endowment effect
- we tend to perceive that our own belongings are more valuable than others' same belongins
Framing Heuristic
- the way people behave depends on the way that their decision problems are framed.
Escalation of commitment
- human behavior pattern in which an individual or group facing increasingly negative outcomes from a decision, action, or investment nevertheless continues the behavior instead of altering course.
WHY
- Ego protection & self-justification.
SOLUTION
- 1.Self Affirmation ( focus on good decisions in other areas). 2.Change of decision maker
Representativeness Heuristic
- When making a judgement about an individual or event, people look for characteristics the individual or event may have in common with previously formed thoughts ( stereotypes )
Winner's Curse
- We suspect that we might have over-bidden after we have won a deal or auction ( associated with emotions such as regret,anger)
Availability Heuristic
- Information that is more easily retrievable from memory has more influence on judgement and decisions
Curse of knowledge
- When we assess other's decision or behaviour, we tend to ignore the fact that they might not have the knowledge that we have. ( giving a friend directions)
Overconfidence Bias
Illusion of control
- Sometimes we think we have more control over circumstances than we actually do
Planning fallacy
- we tend to over-estimate the speed at which we will complete projects and tasks
Over-precision
- We are too sure that our judgemetns & decisions are accurate
Over-placement
- We tend to beleive that we are better than others in specific wats
Hindsight bias
- we tend to overestimate what we knew before hand based upon what we later learned.
Advantage
- self-flattering.
Disadvantage
- reduce our ability to learn from past
Consciousness
Conscious
- mind capacity is limited
Unconscious
- mind is not limited by low capacity