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    Economic irrationality is optimal during noisy decision making

    Tsetsos, Kostantinos and Moran, R. and Moreland, J. and Chater, N. and Usher, Marius and Summerfield, C. (2016) Economic irrationality is optimal during noisy decision making. Proceedings of the National Academy of Sciences of the United States of America 113 (11), pp. 3102-3107. ISSN 0027-8424.

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    Abstract

    According to normative theories, reward-maximizing agents should have consistent preferences. Thus, when faced with alternatives A, B, and C, an individual preferring A to B and B to C should prefer A to C. However, it has been widely argued that humans can incur losses by violating this axiom of transitivity, despite strong evolutionary pres- sure for reward-maximizing choices. Here, adopting a biologically plausible computational framework, we show that intransitive (and thus economically irrational) choices paradoxically improve accuracy (and subsequent economic rewards) when decision formation is cor- rupted by internal neural noise. Over three experiments, we show that humans accumulate evidence over time using a “selective inte- gration” policy that discards information about alternatives with mo- mentarily lower value. This policy predicts violations of the axiom of transitivity when three equally valued alternatives differ circularly in their number of winning samples. We confirm this prediction in a fourth experiment reporting significant violations of weak stochastic transitivity in human observers. Crucially, we show that relying on selective integration protects choices against “late” noise that other- wise corrupts decision formation beyond the sensory stage. Indeed, we report that individuals with higher late noise relied more strongly on selective integration. These findings suggest that violations of ra- tional choice theory reflect adaptive computations that have evolved in response to irreducible noise during neural information processing.

    Metadata

    Item Type: Article
    Keyword(s) / Subject(s): decision making, irrationality, choice, optimality, selective integration, evidence accumulation
    School: Birkbeck Schools and Departments > School of Science > Psychological Sciences
    Depositing User: Kostantinos Tsetsos
    Date Deposited: 19 Apr 2016 13:08
    Last Modified: 06 Sep 2016 10:39
    URI: http://eprints.bbk.ac.uk/id/eprint/14683

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