MHR 405 Lecture Notes - Lecture 7: Subjective Expected Utility, Availability Heuristic, Bounded Rationality
Document Summary
Decision-making: the conscious process of making choices among alternatives with the intention of moving toward some desired state of affairs. Rational choice paradigm: the view in decision making that people should and typically do use logic and all available information to choose the alternative with. Subjective expected utility determines choice with highest value. Decision making process systematic stages of decision making the highest value. Subjective expected utility: the probability of satisfaction resulting from choosing a specific alternative in a decision. Stakeholder framing: by framing the situation, stakeholders throw a spotlight on specific causes of the symptoms and away from other possible causes. Decisive leadership: decisiveness is a characteristic of effective leaders. Solution-focused problems: decision makers have a tendency to define problems as veiled solutions. Perceptual defense: block out bad news as a coping mechanism. Mental models: visual or relational images in our mind of the external world. Bounded rationality: the view that people are bounded in their decision making capabilities.
