# Category: Decision theory

Decision Sciences Institute
The Decision Sciences Institute (DSI) is a professional association of university professors, graduate students, and practitioners whose interest lies in the application of quantitative research and q
Polychotomous key
Polychotomous key refers to the number of alternatives which a decision point may have in a non-temporal hierarchy of independent variables. The number of alternatives are equivalent to the root or nt
Linear partial information
Linear partial information (LPI) is a method of making decisions based on insufficient or fuzzy information. LPI was introduced in 1970 by Polish–Swiss mathematician Edward Kofler (1911–2007) to simpl
Behavioral operations management
Behavioral operations management (often called behavioral operations) examines and takes into consideration human behaviors and emotions when facing complex decision problems. It relates to the behavi
Prospect theory
Prospect theory is a theory of behavioral economics and behavioral finance that was developed by Daniel Kahneman and Amos Tversky in 1979. The theory was cited in the decision to award Kahneman the 20
Random forest
Random forests or random decision forests is an ensemble learning method for classification, regression and other tasks that operates by constructing a multitude of decision trees at training time. Fo
Description-experience gap
The description-experience gap is a phenomenon in experimental behavioral studies of decision making. The gap refers to the observed differences in people's behavior depending on whether their decisio
Recognition primed decision
Recognition-primed decision (RPD) is a model of how people make quick, effective decisions when faced with complex situations. In this model, the decision maker is assumed to generate a possible cours
Value of information
Value of information (VOI or VoI) is the amount a decision maker would be willing to pay for information prior to making a decision.
Distinction bias
Distinction bias, a concept of decision theory, is the tendency to view two options as more distinctive when evaluating them simultaneously than when evaluating them separately. One writer has present
Expected value of sample information
In decision theory, the expected value of sample information (EVSI) is the expected increase in utility that a decision-maker could obtain from gaining access to a sample of additional observations be
Surrogation
Surrogation is a psychological phenomenon found in business practices whereby a measure of a construct of interest evolves to replace that construct. Research on performance measurement in management
AIXI
AIXI ['ai̯k͡siː] is a theoretical mathematical formalism for artificial general intelligence.It combines Solomonoff induction with sequential decision theory.AIXI was first proposed by Marcus Hutter i
Illusion of validity
Illusion of validity is a cognitive bias in which a person overestimates their ability to interpret and predict accurately the outcome when analyzing a set of data, in particular when the data analyze
Minimax
Minimax (sometimes MinMax, MM or saddle point) is a decision rule used in artificial intelligence, decision theory, game theory, statistics, and philosophy for minimizing the possible loss for a worst
Decision Sciences Journal of Innovative Education
Decision Sciences Journal of Innovative Education is a peer-reviewed academic journal published by Wiley-Blackwell on behalf of the Decision Sciences Institute. The current editor-in-chief is Chetan S
Quantum cognition
Quantum cognition is an emerging field which applies the mathematical formalism of quantum theory to model cognitive phenomena such as information processing by the human brain, language, decision mak
Flipism
Flipism, sometimes spelled "flippism", is a pseudophilosophy under which decisions are made by flipping a coin. It originally appeared in the Donald Duck Disney comic "Flip Decision" by Carl Barks, pu
Roughly speaking, in decision theory, game theory, and rational choice, menu dependence arises when the evaluation of alternatives for choice or the mode of selection guiding choice varies parametrica
Predispositioning theory
Predispositioning theory, in the field of decision theory and systems theory, is a theory focusing on the stages between a complete order and a complete disorder. Predispositioning theory was founded
Causal decision theory
Causal decision theory (CDT) is a school of thought within decision theory which states that, when a rational agent is confronted with a set of possible actions, one should select the action which cau
Consumer choice
The theory of consumer choice is the branch of microeconomics that relates preferences to consumption expenditures and to consumer demand curves. It analyzes how consumers maximize the desirability of
Regret (decision theory)
In decision theory, on making decisions under uncertainty—should information about the best course of action arrive after taking a fixed decision—the human emotional response of regret is often experi
Normative model of decision-making
Victor Vroom, a professor at Yale University and a scholar on leadership and decision-making, developed the normative model of decision-making. Drawing upon literature from the areas of leadership, gr
Decision-making models
Decision-making as a team is a scientific process when that decision will affect a policy affecting an entity. Decision-making models are used as a method and process to fulfill the following objectiv
Minimax estimator
In statistical decision theory, where we are faced with the problem of estimating a deterministic parameter (vector) from observations an estimator (estimation rule) is called minimax if its maximal r
Decision theory
Decision theory (or the theory of choice; not to be confused with choice theory) is a branch of applied probability theory concerned with the theory of making decisions based on assigning probabilitie
Sure-thing principle
In decision theory, the sure-thing principle states that a decision maker who decided they would take a certain action in the case that event E has occurred, as well as in the case that the negation o
Expected value of perfect information
In decision theory, the expected value of perfect information (EVPI) is the price that one would be willing to pay in order to gain access to perfect information. A common discipline that uses the EVP
Cognitive bias
A cognitive bias is a systematic pattern of deviation from norm or rationality in judgment. Individuals create their own "subjective reality" from their perception of the input. An individual's constr
Decision rule
In decision theory, a decision rule is a function which maps an observation to an appropriate action. Decision rules play an important role in the theory of statistics and economics, and are closely r
Loss aversion
Loss aversion is the tendency to prefer avoiding losses to acquiring equivalent gains. The principle is prominent in the domain of economics. What distinguishes loss aversion from risk aversion is tha
Naturalistic decision-making
The naturalistic decision making (NDM) framework emerged as a means of studying how people make decisions and perform cognitively complex functions in demanding, real-world situations. These include s
Negotiation theory
The foundations of negotiation theory are decision analysis, , game theory, and .Another classification of theories distinguishes between Structural Analysis, Strategic Analysis, Process Analysis, Int
Maximization (psychology)
Maximization is a style of decision-making characterized by seeking the best option through an exhaustive search through alternatives. It is contrasted with satisficing, in which individuals evaluate
Decision management
Decision management, also known as enterprise decision management (EDM) or business decision management (BDM) entails all aspects of designing, building and managing the automated decision-making syst
Path dependence
Path dependence is a concept in economics and the social sciences, referring to processes where past events or decisions constrain later events or decisions. It can be used to refer to outcomes at a s
Weighted product model
The weighted product model (WPM) is a popular multi-criteria decision analysis (MCDA) / multi-criteria decision making (MCDM) method. It is similar to the weighted sum model (WSM). The main difference
Bayes action
No description available.
Decision model
A decision model in decision theory is the starting point for a decision method within a formal (axiomatic) system. Decision models contain at least one action axiom. An action is in the form "IF is t
Overchoice
Overchoice or choice overload is a cognitive impairment in which people have a difficult time making a decision when faced with many options. The term was first introduced by Alvin Toffler in his 1970
In probability and statistics, a mean-preserving spread (MPS) is a change from one probability distribution A to another probability distribution B, where B is formed by spreading out one or more port
Scoring rule
In decision theory, a scoring rule provides a summary measure for the evaluation of probabilistic predictions or forecasts. It is applicable to tasks in which predictions assign probabilities to event
Satisficing
Satisficing is a decision-making strategy or cognitive heuristic that entails searching through the available alternatives until an acceptability threshold is met. The term satisficing, a portmanteau
Decision-theoretic rough sets
In the mathematical theory of decisions, decision-theoretic rough sets (DTRS) is a probabilistic extension of rough set classification. First created in 1990 by Dr. Yiyu Yao, the extension makes use o
Fuzzy-trace theory
Fuzzy-trace theory (FTT) is a theory of cognition originally proposed by Valerie F. Reyna and Charles Brainerd that draws upon dual-trace conceptions to predict and explain cognitive phenomena, partic
Evidential decision theory
Evidential decision theory (EDT) is a school of thought within decision theory which states that, when a rational agent is confronted with a set of possible actions, one should select the action with
Intertemporal choice
Intertemporal choice is the process by which people make decisions about what and how much to do at various points in time, when choices at one time influence the possibilities available at other poin
Cross-cultural differences in decision-making
Decision-making is a mental activity which is an integral part of planning and action taking in a variety of contexts and at a vast range of levels, including, but not limited to, budget planning, edu
Cumulative prospect theory
Cumulative prospect theory (CPT) is a model for descriptive decisions under risk and uncertainty which was introduced by Amos Tversky and Daniel Kahneman in 1992 (Tversky, Kahneman, 1992). It is a fur
Randomised decision rule
In statistical decision theory, a randomised decision rule or mixed decision rule is a decision rule that associates probabilities with deterministic decision rules. In finite decision problems, rando
Weighted sum model
In decision theory, the weighted sum model (WSM), also called weighted linear combination (WLC) or simple additive weighting (SAW), is the best known and simplest multi-criteria decision analysis (MCD
Allegiance bias
Allegiance bias (or allegiance effect) in behavioral sciences is a bias resulted from the investigator's or researcher's allegiance to a specific school of thought. Researchers/investigators have been
Default effect
The default effect, a concept within the study of nudge theory, explains the tendency for an agent to generally accept the default option in a strategic interaction. The default option is the course o
Luce's choice axiom
In probability theory, Luce's choice axiom, formulated by R. Duncan Luce (1959), states that the probability of selecting one item over another from a pool of many items is not affected by the presenc
Dominating decision rule
In decision theory, a decision rule is said to dominate another if the performance of the former is sometimes better, and never worse, than that of the latter. Formally, let and be two decision rules,
Rubicon model
In psychological theories of motivation, the Rubicon model, more completely the Rubicon model of action phases, makes a distinction between motivational and volitional processes. The Rubicon model "de
Agent (economics)
In economics, an agent is an actor (more specifically, a decision maker) in a model of some aspect of the economy. Typically, every agent makes decisions by solving a well- or ill-defined optimization
Emotional choice theory
Emotional choice theory (also referred to as the "logic of affect") is a social scientific action model to explain human decision-making. Its foundation was laid in Robin Markwica’s monograph Emotiona
Illusory truth effect
The illusory truth effect (also known as the illusion of truth effect, validity effect, truth effect, or the reiteration effect) is the tendency to believe false information to be correct after repeat
Outcome primacy
'Outcome primacy' is a psychological phenomenon that describes lasting effects on a subject's behavior based on the outcome of first experiences with a given task or decision. It was found that this o
Decoy effect
In marketing, the decoy effect (or attraction effect or asymmetric dominance effect) is the phenomenon whereby consumers will tend to have a specific change in preference between two options when also
Info-gap decision theory
Info-gap decision theory seeks to optimize robustness to failure under severe uncertainty, in particular applying sensitivity analysis of the stability radius type to perturbations in the value of a g
Secretary problem
The secretary problem demonstrates a scenario involving optimal stopping theory that is studied extensively in the fields of applied probability, statistics, and decision theory. It is also known as t
Pignistic probability
In decision theory, a pignistic probability is a probability that a rational person will assign to an option when required to make a decision. A person may have, at one level certain beliefs or a lack