ERIC Number: EJ742337
Record Type: Journal
Publication Date: 2006-Jul
Does Decision Quality (Always) Increase with the Size of Information Samples? Some Vicissitudes in Applying the Law of Large Numbers
Fiedler, Klaus; Kareev, Yaakov
Journal of Experimental Psychology: Learning, Memory, and Cognition, v32 n4 p883-903 Jul 2006
Adaptive decision making requires that contingencies between decision options and their relative assets be assessed accurately and quickly. The present research addresses the challenging notion that contingencies may be more visible from small than from large samples of observations. An algorithmic account for such a seemingly paradoxical effect is offered within a satisficing-choice framework. Accordingly, a choice is only made when the sample contingency describing the relative evaluation of the 2 options exceeds a critical threshold. Small samples, because of the high dispersion of their sampling distribution, facilitate above-threshold contingencies. Across a broad range of parameters, the resulting small-sample advantage in terms of hits is stronger than their disadvantage in false alarms. Computer simulations and experiments support the model predictions. The relative advantage of small samples is most apparent when information loss is low, when the threshold is high relative to the ecological contingency, and when the sampling process is self-truncated.
Descriptors: Sampling, Decision Making, Computer Simulation, Models, Prediction, Sample Size, Experimental Psychology, Observation, Mathematics
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Publication Type: Journal Articles; Reports - Descriptive
Education Level: N/A
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