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James T. Townsend Lab
Department of Psychology
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Decision Making (James Townsend, Jerome Busemeyer)

Many previous theories of decision-making (e.g., the prospect theory of Kahneman and Tversky, 1979) assume that for any particular situation, individuals assign weights and values to each possible outcome, and the final decision is simply a matter of comparing the summed products of weights and values for each alterative. The entire process is described in deterministic and static manner. There is no explanation of changes in state of preference over time, and there is no mechanism for deriving the time needed for deliberation.

This criticism applies equally well to all static-deterministic theories of risky decision making that have evolved from the basic expected utility formulation (von Neumann and Morgenstern, 1947; Savage, 1954). Static theories assume that the preference relation (for deterministic models) or the probability function (for probabilistic models) is independent of the length of deliberation time. Dynamical theories specify how the preference relation of probability function changes as a function of deliberation time.

Decision field theory (DFT), provides a dynamical, stochastic description of the deliberation process involved in decision-making. It is unique in its capability for deriving precise quantitative predictions for:

(a) the probability of choosing each alternative as a function of deliberation time (Busemeyer and Townsend, 1993)
(b) the mean deliberation time needed to make a decision (Busemeyer and Townsend, 1993)
(c) the distribution of selling prices, buying prices, and certainty equivalents for gambles (Busemeyer and Goldstein, 1992) and
(d) approach-avoidance movement behavior (Busemeyer and Townsend, 1989).

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Last updated: 09 May 2020
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