Dominik Lenda’s research while affiliated with SWPS University and other places

A vast body of research has indicated that intensified deliberation on choice problems often improves decision accuracy, as evidenced by choices that maximize expected value (EV). However, such extensive deliberation is not always feasible due to cognitive and environmental constraints. In one simulation study and three well-powered fully incentivized empirical studies, using the decision-from-experience task, we found that individuals who maximized EV without time constraints accumulated higher total gain. The trend reversed in the following two studies. Under time constraints, participants who made more suboptimal (or random in terms of EV maximization) decisions earned more money than those who spent more time maximizing EV. By comparing sampling and decision strategies among people with higher and lower statistical numeracy, we found that more numerate individuals made quicker suboptimal choices, resulting in better overall earnings than less numerate individuals. Detailed analysis indicated that skilled decision makers sampled information more rapidly and dynamically. They adaptively relied on varying search strategies, initially focusing on reducing uncertainty and later discovering unobserved outcomes. Finally, adaptive exploration was accompanied by the development of a metacognitive understanding of the task structure and choice environment. Participants who recognized the effectiveness of the random selection strategy earned more rewards. Taken together, these findings suggest that people (especially those with higher numeracy) in time-constrained environment adaptively changed their decision-making strategies and developed a metacognitive understanding of the task structure and decision environment. This resulted in making recurring suboptimal choices that led to superior long-term performance in the decision task.

A vast body of research has indicated that intensified deliberation on choice problems often improves decision accuracy, as evidenced by choices that maximize expected value (EV). However, such extensive deliberation is not always feasible due to cognitive and environmental constraints. In one simulation study and three well-powered fully-incentivized empirical studies, using the decision-from-experience task, we found that individuals who maximized EV without time constraints accumulated higher total gain. The trend reversed in the following two studies. Under time constraints, participants who made more suboptimal (or random in terms of EV maximization) decisions earned more money than those who spent more time maximizing EV. By comparing sampling and decision strategies among people with higher and lower statistical numeracy, we found that more numerate individuals made quicker suboptimal choices, resulting in better overall earnings than less numerate individuals. Detailed analysis indicated that skilled decision makers sampled information more rapidly and dynamically. They adaptively relied on varying search strategies, initially focusing on reducing uncertainty and later discovering unobserved outcomes. Finally, adaptive exploration was accompanied by the development of a metacognitive understanding of the task structure and choice environment. Participants who recognized the effectiveness of the random selection strategy earned more rewards. Taken together, these findings suggest that people (especially those with higher numeracy) in time-constrained environment adaptively changed their decision-making strategies and developed a metacognitive understanding of the task structure and decision environment. This resulted in making recurring suboptimal choices that led to superior long-term performance in the decision task.

A vast body of research has indicated that individuals with higher statistical numeracy, in comparison to individuals with lower statistical numeracy, make superior decisions by employing more deliberative processes leading to selecting options with the highest expected value (EV). However, it is not feasible to deliberate every time we make a choice due to cognitive and environmental constraints. In one simulation study and three well-powered, fully-incentivized empirical studies using the decision-from-experience task, we identified conditions where recurring suboptimal choices were more rewarding than a normatively superior strategy. That is, even if individual choices in isolation are considered suboptimal in light of the EV maximization principle, individuals with higher numeracy can adapt their decision strategy in accordance with changes in the task structure, and make faster suboptimal (or random in terms of EV maximization) decisions that result in overall superior performance (e.g., earning more money). We found that individuals who maximized EV without time constraints accumulated higher total gain. However, the trend reversed in the following two studies. Participants who made more suboptimal choices, under time constraints, earned more money than those who spent more time maximizing EV. Importantly, we found that more numerate individuals made significant adjustments to their meta-cognitive decision processes and made more quick suboptimal choices resulting in better overall earnings than less numerate individuals. Finally, our results also indicate that more numerate individuals are better at identifying the changes in the task structure and are more rational in their use of cognitive and environmental resources.

A vast body of research has indicated that individuals with higher statistical numeracy, in comparison to individuals with lower statistical numeracy, make superior decisions by employing more deliberative processes leading to selecting options with the highest expected value (EV). However, it is not feasible to deliberate every time we make a choice due to cognitive and environmental constraints. In one simulation study and three well-powered, fully-incentivized empirical studies using the decision-from-experience task, we identified conditions where recurring suboptimal choices were more rewarding than a normatively superior strategy. That is, even if individual choices in isolation are considered suboptimal in light of the EV maximization principle, individuals with higher numeracy can adapt their decision strategy in accordance with changes in the task structure, and make faster suboptimal (or random in terms of EV maximization) decisions that result in overall superior performance (e.g., earning more money). We found that individuals who maximized EV without time constraints accumulated higher total gain. However, the trend reversed in the following two studies. Participants who made more suboptimal choices, under time constraints, earned more money than those who spent more time maximizing EV. Importantly, we found that more numerate individuals made significant adjustments to their meta-cognitive decision processes and made more quick suboptimal choices resulting in better overall earnings than less numerate individuals. Finally, our results also indicate that more numerate individuals are better at identifying the changes in the task structure and are more rational in their use of cognitive and environmental resources.

Processing information about probabilities is an integral part of decision making under risk. Even when objective probabilities are explicitly provided, people tend to distort them, which is reflected by an inverted S-shaped probability weighting function. Such distortions depend on different factors such as numeracy and affect. The present study contributes to the understanding of how people use probabilities in risky decision making by introducing the concept of consistency in probability processing―a measure of how coherent people are in using objective probabilities. We hypothesized that consistency would depend on factors similar to those that influence the shape of the probability weighting function. Moreover, we predicted that probability processing consistency would be related to better decision outcomes in an experimental betting task. In three experiments, participants were presented with the probability of a potential gain/loss and had to place a bet on a given chance to maximize their total earnings. We defined probability processing consistency as the variance of bets placed on the same probability value, with higher variance indicating lower consistency. We found that consistency in probability processing was lower in relatively affect-rich conditions and greater for people with higher numeracy. Additionally, people who exhibited more consistent processing of probabilities gained higher earnings from the experimental task irrespective of whether their betting strategy was optimal and of their risk preference. Our findings imply that consistency in processing probabilities may be an important factor in understanding betting strategies and the quality of decisions.

Background: According to decision by sampling theory, people store relative frequencies of events in memory, and these values constitute subjective representations of events. Because fear is a natural response to the threat of death, we hypothesized that case fatality rate (CFR) statistics, which represent how deadly a disease is, would be positively correlated with self-reported fear ratings of neoplasms and circulatory diseases. Methods: Participants ( N = 239) were asked to rate various neoplasms and circulatory diseases (110 diseases in total) on fear, typicality, and disgust scales (e.g., 1 = no fear, 10 = intense fear). They also estimated mortality and morbidity rates for the same set of diseases. Finally, they completed the Berlin Numeracy Test. CFRs were obtained from the World Health Organization (WHO) database. The association between relative CFR and fear ratings was tested using correlation analyses and a multilevel linear model with Bayesian inference techniques. Results: We found that fear ratings were related to relative CFRs ( r = 0.42, [0.25, 0.56], BF = 3511). This effect was present on aggregate and, to some extent, on individual levels, even after controlling for other ratings, morbidity rate, participants' estimates of mortality and morbidity statistics, numeracy, sex, age, and knowledge of WHO statistics. Also, women rated neoplasms as more frightening than circulatory diseases, and typicality ratings were related to morbidity rates. Limitations: Limited number of diagnostic entities and categories, lack of control over the technicality of disease names and participants' experience of diseases, and study sample (83% young women). Conclusions: We present initial evidence that implicit acquisition of CFRs of diseases through everyday experience may be related to the intensity of fear reactions to them.