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Biases in thinking and decision-making - Coggle Diagram
Biases in thinking and decision-making
heuristics- is any approach to problem solving or self discovery that employs a practical method that is not guaranteed to be optimal, perfect, or rational, but is nevertheless sufficient for reaching an immediate short term goal or approximations
usage
reduce mental effort needed to make decisions
simplify complex and difficult questions
they're a fast and accurate way to arrive at a conclusion
help with problem solving
Kahneman and Tversky
Representativeness Heuristic
Availability Heuristic
Daniel Kahneman 2003
system one
fast
unconscious
automatic
everyday decisions
error prone
system two
slow
conscious
effortful
complex decisions
reliable
intuitive thinking
the tendency to focs on a limited amount of available information (asymmetric dominance, framing effect)
selective attention is the process of directing out awareness to relavant stimuli while ignoring irrelevant stimuli in the environment
the asymmetric dominance effect also called the decoy effect is the phenomenon where customers tent to have a change in preference between two options when presented with a third option that is asymmetrically dominated
huber, payne and puto (1982)
framing effect is a cognitive bias where people decide on options based on whether the options are presented with positive or negative connotations
the tendency to seek out information that confirms pre existing beliefs. (confirmation bias, congruence bias, illusory correlations and implicit personality theories)
the tendency to avoid the mental stress of holding inconsistent cognitions( cognitive dissonance)
factors
confirmation bias- the tendency to search for, interpret, favour and recall information in a way that confirms or supports ones prior beliefs or values. it is an important type of cognitive bias that has a significant effect on the proper functioning of society by distorting evidence- based decision making
cognitive dissonance- state of having inconsistent thoughts, beliefs, or attitudes, especially as relating to behavioural decisions and attitude change
optimism bias- tendency to think that nothing bad will ever happen to you
selective attention- the tendency to focus on a limited number of stimuli when several are occurring at the same time
cocktail party phenemenon- describes the ability to focus ones listening attention on a single talker among a mixture of conversations and background noises, ignoring other conversations. ( form of selective attention)
illusory correlations- the tendency to incorrectly identify correlations where there are none