Escaping from Bad Decisions: A Behavioral Decision-Theoretic Perspective presents a modern, conceptual and mathematical framework that explains how decision-making under certainty, risk and uncertainty can be better understood and theoretically explained. In addition, the book provides a critical examination of psychological models in multi-attribute decision-making and evaluates and defines the constitutive elements of "good decisions" and "bad decisions." By defining ordinal utility theory relating to multi-attribute decision-making, this book re-interprets the rationality of multi-attribute decision-making based on Arrow's general possibility theorem. This book will be ideal for graduate students and early career researchers in economics, decision theory and cognitive science.
- Provides a comprehensive background to the phenomena of bad decisions, considered in their economic, psychological and cognitive aspects
- Reinterprets existing theories and phenomena and proposes a new overview of decision behaviors by integrating mathematical and psychological perspectives
- Adapts model-based techniques, such as mathematical model based functional magnetic resonance imaging (fMRI) using mathematical models of the decision process
Part I Theory of good decision and bad decision 1.What is best decision? 2. Decision theoretic concepts to make best decision 3. Non-cyclic preference relation and rational decision 4. Weak order and revealed preference 5. Difficulties of making best decision 6. Multi-attribute decision making 7. Difficulties of making best decision in multi-attribute situation: Re-interpretation of Arrow's impossibility theorem 8. Pareto optimality in multi objective decision 9.Worst decision and decision theory
Part II Empirical illustrations and explanations of bad decision 10. Historical illustrations of bad decisions: A Japanese history of World War II and Business example of bad decisions 11. Social psychological explanations of bad decisions: Authority and conformity 12. Experimental analysis of bad decisions: Using eye-gaze movement equipment 13. Web survey of bad decisions: Psychological tendencies of those who make bad decisions 14. Experimental analysis of group bad decisions 15. Psychology of bad decisions and their decision theoretic models
Part III Prescriptions: how to escape from bad decisions 16. Multi attribute decision and conjoint structure 17.Computer simulation of decision strategies 18. Easy decision strategies to reach better decisions based on computer simulation 19. Easy decision strategies to escape from worse decisions based on computer simulation 20. Mathematical descriptions of easy decision strategies and related theorem 21. Toward good decision making: Integration of theoretical and empirical findings
Kazuhisa Takemura is a professor of psychology and economics and the director of the Institute for Decision Research at Waseda University. His research focuses on human judgment and decision making, especially modeling of preferential judgment and choice. He received the Hayashi Award (Distinguished Scholar) from The Behaviormetric Society in 2002, Excellent Paper Award from Japan Society of Kansei Engineering in 2003, the Book Award from Japanese Society of Social Psychology in 2010, the Book Award from Behaviormetric Society in 2016, and the Fellow Award from International Association of Applied Psychology in 2018.