Lectures
Lecture 1: Introduction and Foundations of Decision Analysis
- no readings for first lecture
Lecture 1
Lecture 1_new.pptx3.5MB
Lecture 2: Utility & Bayes’ Theorem
- Reading: Baron: Normative theory of choice under uncertainty. In Thinking and Deciding, 4th ed., 2008, pp. 233-243
- Additional reading: Hastie & Dawes: Changing Our Minds: Bayes’ Theorem. In Rational Choice in an UncertainWorld, 2nd ed., 2010, pp. 178-188
Lecture 3: Axioms & elicitation
- Reading: Hastie & Dawes: Defining Rationality: Expected Utility Theory. In Rational Choice in an Uncertain World, 2nd ed., 2010, pp. 244-259
- Additional reading: Chesley: Elicitation of Subjective Probabilities: A Review, Accounting Review 50 (2), April 1975, pp. 325-337
- Reading:
Lecture 4: Basic concepts of behavioral decision making, prospect theory
- Reading: Only Section III in Kahneman: Maps of Bounded Rationality: Psychology for Behavioral Economics, The American Economic Review, Vol. 93, No. 5 2003, pp. 1449-1475
- Additional reading: Camerer: Prospect Theory in the Wild: Evidence from the Field. In Choices, Values, and Frames, (Eds.) Kahneman & Tversky, reprinted 2005, 288-300
Lecture 5: Anchoring, availability and representativeness
- Reading: Tversky & Kahneman: Judgment under Uncertainty: Heuristics and Biases, Science 185, 1974, pp. 1124-1131
- Additional reading: Hammond, Keeney, Raiffa: The Hidden Traps in Decision Making, Harvard Business Review, 1998, pp.47-58
Lecture 6: Framing and mental accounting
- Reading: Tversky & Kahneman: The Framing of Decisions and the Psychology of Choice, Science 211, 1981, pp. 453-458
- Additional reading: Thaler: Mental Accounting and Consumer Choice, Marketing Science 4, 1985, pp. 199 – 214
Lecture 7: Fast & frugal decision making
- Reading: Simon: A Behavioral Model of Rational Choice, Quarterly Journal of Economics 69 (1), 1955, pp. 99-118
- Additional reading: Gigerenzer & Goldstein: Reasoning the Fast and Frugal Way: Models of Bounded Rationality, Psychological Review 103(4), 1996, pp. 650-669.
Lecture 8: Emotions / embodied cognition
- Reading: Hsee & Rottenstreich: Music, Pandas, and Muggers: On the Affective Psychology of Value, Journal of Experimental Psychology, 2004, 133 (1), 23-30
- Additional reading: Bechara & Damasio: The somatic marker hypothesis: An neural theory of economic decision, Games and Economic Behavior, 52, 2005, 336-372
Lecture 9: Dealing with conflicting objectives
- Reading: Baird: Multicriteria Decisions. In Managerial Decisions Under Uncertainty, 1990, chapter 13
- Additional reading: none
baird chapter 13.pdf4.3MB
Lecture 10: Aiding decision making
- Reading: Hammond, J. S., Keeney, R. L., & Raiffa, H. Even Swaps: A Rational Method for Making Trade-Offs. Harvard Business Review, 1998, 76(2), pp. 137–150
- Additional reading: Münscher, R., Vetter, M., & Scheuerle, T. A Review and Taxonomy of Choice Architecture Techniques. Journal of Behavioral Decision Making, 2015.