Decision theory as an aid to private choice

A wise decider D uses the contents of his mind fully, accurately and efficiently. D’s ideal decisions, i.e. those which best serve his interests, would be embedded in a comprehensive set of totally coherent judgments. They would conform to the norms of statistical decision theory, which extracts quantitative judgments of fact and value from D’s mind contents and checks them for coherence. However, the most practical way for D to approximate his ideal may not be with models that embody those norms, i.e. with applied decision theory (ADT). In practice, ADT can only represent some of D’s judgments and those imperfectly. Quite different decision aid, including intuition, pattern recognition and cognitive vigilance, typically outperform feasible ADT models—with some notable exceptions. However, decision theory training benefits D’s informal decisions. ADT, both formal and informal, should become increasingly useful and widespread, as technical, cultural and institutional impediments are overcome.

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