Elliot Ludvig, Assistant Professor in the Department of Psychology at Warwick University, UK will be visiting us next Thursday and giving a talk in the Social, Economic, and Decision Psychology Colloquium (abstract follows). He earned his Ph.D. from Duke University in Psychological and Brain Sciences and did post-doctoral research in Neuroscience at Princeton University and in Computing Science at the University of Alberta. His research builds and tests computational models of how humans and other animals learn to make decisions

Memory biases in risky decisions from experience

When faced with risky choices, people often choose differently pending whether they learn about the odds and outcomes through explicit description or through repeated experience. In the latter case, when deciding based on past experiences, people must rely on their memories to guide choice. These memories, however, need not be veridical. In this talk, I discuss two ways in which memories of past outcomes can be distorted, affecting choice in risky decisions from experiences. First, people tend to remember the most extreme outcomes encountered (both best and worst), making them more risk seeking for gains than losses. Second, subtle reminders of past wins can induce people to gamble more. These biases are not uniquely human, and similar patterns of risky choice have been observed in pigeons and monkeys. I interpret these results through a reinforcement-learning model, derived from studies on animal learning, that learns similarly from both real and replayed experiences.

Peter Mohr, Junior Professor and head of the Dahlem International Junior Research Group „Neuroeconomics” at the Freie Universitaet Berlin, will be visiting us this Thursday and giving a talk in the Social, Economic, and Decision Psychology Colloquium (abstract follows).

Context Effects in Risky Choices

Context effects are defined as preference changes, depending on the set of available options. The mechanisms that lead to their emergence are, however, still under debate. Unlike utility-based models of choice, more sophisticated evidence accumulation frameworks like Multialternative Decision Field Theory (MDFT) are generally able to account for these effects. In a first experiment, we show that one specific context effect, namely the attraction effect, is present in risky choices and can be explained by MDFT. In a second experiment we extend these findings by showing, that another context effect, namely the compromise effect, is also present in risky choices. Similarly to the first experiment, MDFT is able to explain both context effects in risky choices. Recently, however, visual attention has been ascribed a more constructive and active role in preference formation, leading to the development of attention-based models of choice. Eye-tracking data in our second experiment suggests a strong relation between choice and visual attention, replicating the so-called gaze cascade effect and demonstrating both context effects also in visual attention. Finally, the inclusion of visual attention into existing models of choice substantially increased their ability to explain context effects in risky choices.