Dynamic decision-making in uncertain environments II. Allais paradox in human behavior

In both animal and human behavioral repertoires, classical expected utility theory is considered a fundamental element of decision making under conditions of uncertainty. This theory has been widely applied to problems of animal behavior and evolutionary game theory, as well as to human economic behavior. The Allais paradox hinges on the expression of avoidance of bankruptcy by humans, or death by starvation in animals. This paradox reveals that human behavioral patterns are often inconsistent with predictions under the classical expected utility theory as formulated by von Neumann and Morgenstern. None of the many attempts to reformulate utility theory has been entirely successful in resolving this paradox with rigorous logic. We present a simple, but novel approach to the theory of decision making, in which utility is dependent on current wealth, and in which losses are more heavily weighted than gains. Our approach resolves the Allais paradox in a manner that is consistent with how humans formulate decisions under uncertainty. Our results indicate that animals, including humans, are in principle risk-averse. Our restructuring of dynamic utility theory presents a basic optimization scheme for sequential or dynamic decisions in both animals and humans.     

A selective emotional decision-making bias elicited by facial expressions

Emotional and social information can sway otherwise rational decisions. For example, when participants decide between two faces that are probabilistically rewarded, they make biased choices that favor smiling relative to angry faces. This bias may arise because facial expressions evoke positive and negative emotional responses, which in turn may motivate social approach and avoidance. We tested a wide range of pictures that evoke emotions or convey social information, including animals, words, foods, a variety of scenes, and faces differing in trustworthiness or attractiveness, but we found only facial expressions biased decisions. Our results extend brain imaging and pharmacological findings, which suggest that a brain mechanism supporting social interaction may be involved. Facial expressions appear to exert special influence over this social interaction mechanism, one capable of biasing otherwise rational choices. These results illustrate that only specific types of emotional experiences can best sway our choices.     

Dynamic decision-making in uncertain environments I. The principle of dynamic utility

Understanding the dynamics or sequences of animal behavior usually involves the application of either dynamic programming or stochastic control methodologies. A difficulty of dynamic programming lies in interpreting numerical output, whereas even relatively simple models of stochastic control are notoriously difficult to solve. Here we develop the theory of dynamic decision-making under probabilistic conditions and risks, assuming individual growth rates of body size are expressed as a simple stochastic process. From our analyses we then derive the optimization of dynamic utility, in which the utility of weight gain, given the current body size, is a logarithmic function: hence the fitness function of an individual varies depending on its current body size. The dynamic utility function also shows that animals are universally sensitive to risk and display risk-averse behaviors. Our result proves the traditional use of expected utility theory and game theory in behavioral studies is valid only as a static model.     

Sensitivity and bias in decision-making under risk: evaluating the perception of reward, its probability and value

Background

There are few clinical tools that assess decision-making under risk. Tests that characterize sensitivity and bias in decisions between prospects varying in magnitude and probability of gain may provide insights in conditions with anomalous reward-related behaviour.

Objective

We designed a simple test of how subjects integrate information about the magnitude and the probability of reward, which can determine discriminative thresholds and choice bias in decisions under risk.

Design/Methods

Twenty subjects were required to choose between two explicitly described prospects, one with higher probability but lower magnitude of reward than the other, with the difference in expected value between the two prospects varying from 3 to 23%.

Results

Subjects showed a mean threshold sensitivity of 43% difference in expected value. Regarding choice bias, there was a ‘risk premium’ of 38%, indicating a tendency to choose higher probability over higher reward. An analysis using prospect theory showed that this risk premium is the predicted outcome of hypothesized non-linearities in the subjective perception of reward value and probability.

Conclusions

This simple test provides a robust measure of discriminative value thresholds and biases in decisions under risk. Prospect theory can also make predictions about decisions when subjective perception of reward or probability is anomalous, as may occur in populations with dopaminergic or striatal dysfunction, such as Parkinson''s disease and schizophrenia.     

Social setting,intuition and experience in laboratory experiments interact to shape cooperative decision-making

Recent studies suggest that cooperative decision-making in one-shot interactions is a history-dependent dynamic process: promoting intuition versus deliberation typically has a positive effect on cooperation (dynamism) among people living in a cooperative setting and with no previous experience in economic games on cooperation (history dependence). Here, we report on a laboratory experiment exploring how these findings transfer to a non-cooperative setting. We find two major results: (i) promoting intuition versus deliberation has no effect on cooperative behaviour among inexperienced subjects living in a non-cooperative setting; (ii) experienced subjects cooperate more than inexperienced subjects, but only under time pressure. These results suggest that cooperation is a learning process, rather than an instinctive impulse or a self-controlled choice, and that experience operates primarily via the channel of intuition. Our findings shed further light on the cognitive basis of human cooperative decision-making and provide further support for the recently proposed social heuristics hypothesis.     

Social interactions elicit rapid shifts in functional connectivity in the social decision-making network of zebrafish

According to the social decision-making (SDM) network hypothesis, SDM is encoded in a network of forebrain and midbrain structures in a distributed and dynamic fashion, such that the expression of a given social behaviour is better reflected by the overall profile of activation across the different loci rather than by the activity of a single node. This proposal has the implicit assumption that SDM relies on integration across brain regions, rather than on regional specialization. Here we tested the occurrence of functional localization and of functional connectivity in the SDM network. For this purpose we used zebrafish to map different social behaviour states into patterns of neuronal activity, as indicated by the expression of the immediate early genes c-fos and egr-1, across the SDM network. The results did not support functional localization, as some loci had similar patterns of activity associated with different social behaviour states, and showed socially driven changes in functional connectivity. Thus, this study provides functional support to the SDM network hypothesis and suggests that the neural context in which a given node of the network is operating (i.e. the state of its interconnected areas) is central to its functional relevance.     

LCA in decision-making processes

Synthetic sulfuric acid is used in a wide range of applications in fine chemical industry. Despite an already performed optimization of input amounts, used sulfuric acid is still a quantitatively important waste by-product. As a result, different utilization technologies for used sulfuric acid exist:

1. production of gypsum
2. thermal reductive cracking
3. thermal cracking and oxidation

This makes an LCA study of this waste by-product quite interesting. In this paper:

? the starting point for a comparative LCA of the above mentioned utilization technologies at a concrete situation is explained, in a work of Ciba-Geigy Corp.

? a short summary of the comparative LCA is presented

? lessons learned from performing the LCA and using it in a decision process are described.

     

Irrational time allocation in decision-making

Time is an extremely valuable resource but little is known about the efficiency of time allocation in decision-making. Empirical evidence suggests that in many ecologically relevant situations, decision difficulty and the relative reward from making a correct choice, compared to an incorrect one, are inversely linked, implying that it is optimal to use relatively less time for difficult choice problems. This applies, in particular, to value-based choices, in which the relative reward from choosing the higher valued item shrinks as the values of the other options get closer to the best option and are thus more difficult to discriminate. Here, we experimentally show that people behave sub-optimally in such contexts. They do not respond to incentives that favour the allocation of time to choice problems in which the relative reward for choosing the best option is high; instead they spend too much time on problems in which the reward difference between the options is low. We demonstrate this by showing that it is possible to improve subjects'' time allocation with a simple intervention that cuts them off when their decisions take too long. Thus, we provide a novel form of evidence that organisms systematically spend their valuable time in an inefficient way, and simultaneously offer a potential solution to the problem.     

Group decision-making in fission-fusion societies

The prevalent view of group splitting during group decisions is that a beneficial consensus has not been reached because time constraints, different individual information, or inter-individual conflicts lead to fission instead of a compromise. However, societies with high fission-fusion dynamics may allow their members to avoid consensus decisions that are not in their favour without foregoing grouping benefits that arise from collective behaviour. Moreover, by forming temporary subgroups that represent individual preferences better than the group as a whole fission-fusion societies could avoid a permanent break up even in situations where conflicts among their members are to strong to reach a consensus.     

Mental health in situations of armed conflict

Mental health is a serious problem in Latin America where many communities have been directly affected by armed conflict, communities in which large population groups have been displaced or have sought refuge. Research studies and epidemiological statistics are summarized to emphasize the psychosocial consequences of traumatic events associated with armed conflict. In addition to specific psychological disorders, other more generalized are considered such as fear, affliction, diseases, social disorder, violence and psychoactive substance consumption. Finally, the main points of a mental health plan for emergency situations are described which include the following: (1) preliminary diagnosis, (2) increase, decentralize and strengthen mental health public services, (3) psychosocial attention to the prevailing disorders--with emphasis on childhood problems, (4) initiate training and use of non-specialized personnel, and (5) identification of special needs requiring attention by psychologists and psychiatrists. Other aspects emphasized were community education, training, social communication, community organization, social participation, interinstitutional coordination, flexibility, sustainability, and specific actions in accordance with local needs.     

Misconceptions and false expectations in neutral evolution

Neutral evolution results from random recurrent mutation and genetic drift. A small part of random evolution, that which is related to protein or DNA polymorphisms, is the subject of the Neutral Theory of Evolution. One of the foundations of this theory is the demonstration that the mutation rate (m) is equal to the substitution rate. Since both rates are independent of population size, they are independent of drift, which is dependent upon population size. Neutralists have erroneously equated the substitution rate with the fixation rate, despite the fact that they are antithetical conceptions. The neutralists then applied the random walk stochastic model to justify alleles or bases that were fixated or eliminated. In this model, once the allele or base frequencies reach the monomorphic states (values of 1.0 or 0.0), the absorbing barriers, they can no longer return to the polymorphic state. This operates in a pure mathematical model. If recurrent mutation occurs (as in biotic real systems) fixation and elimination are impossible. A population of bacteria in which m = 10(-8) base mutation (or substitution)/site/generation and the reproduction rate is 1000 cell cycle/year should replace all its genome bases in approximately 100,000 years. The expected situation for all sites is polymorphism for the four bases rather than monomorphism at 1.0 or 0.0 frequencies. If fixation and elimination of a base for more than 500,000 years are impossible, then most of the neutral theory is untenable. A new complete neutral model, which allows for recurrent substitutions, is proposed here based on recurrent mutation or substitution and drift alone. The model fits a binomial or Poisson distribution and not a geometric one, as does neutral theory.     

Logarithmic transformation bias in allometry

It has been known for some time (DJ Finney, J. Roy. Stat. Soc. Suppl. 7:155–161, 1941) that transformation of an arithmetic data set to logarithms results in biased estimates when predicted values from a leastsquares regression are detransformed back to arithmetic units. Predicted values are estimates of the geometric mean of the dependent variable at that value of the independent variable, rather than the arithmetic mean. Since the geometric mean is always less than the arithmetic mean, detransformed predictions will underestimate the value in question. This bias affects the interpretations of allometric equations used for estimation, such as predicting fossil body mass from skeletal dimensions, and applications of allometry as a “criterion of subtraction,” in which residual variation is evaluated. A number of parametric and nonparametric corrections for transformation bias have been developed. Although this problem is relatively unexplored in mammalian morphometrics, it has received considerable attention in other disciplines that use power functions structurally identical to the allometric equation. Insights into transformation bias and the use of correction terms from economics, limnology, forestry, and hydrology are reviewed and interpreted for application to mammalian allometry. © 1993 Wiley-Liss, Inc.     

Environmental bias in twin studies

Abstract

This study examines the responses of mothers of twin girls about similarities and differences of their monozygotic (MZ) and dizygotic (DZ) twins. After these measures had been completed and scored, the investigator obtained zygosity diagnoses of the twins made by extensive blood‐group analyses. Of the 61 pairs of twins, 11 were misclassified by their mothers. Despite these mothers’ erroneous beliefs about the zygosity of their twins, they described the twins as having similarities and differences appropriate to their true degree of genetic relatedness.