Vlaev, Ivo, Chater, Nick, Stewart, Neil, 1974- and Brown, G. D. A. (Gordon D. A.). (2011) Does the brain calculate value? Trends in Cognitive Sciences, Vol.15 (No.11). pp. 546-554. ISSN 13646613

Preview	PDF WRAP_Brown_060112-vlaev_chater_stewart_brown_2011.pdf - Accepted Version - Requires a PDF viewer such as GSview, Xpdf or Adobe Acrobat Reader Download (579Kb)
Preview	PDF (Cover sheet) WRAP_stewart3_coversheet_ASTRO.pdf - Draft Version - Requires a PDF viewer such as GSview, Xpdf or Adobe Acrobat Reader Download (50Kb)

Abstract

How do people choose between options? At one extreme, the ‘value-first’ view is that the brain computes the value of different options and simply favours options with higher values. An intermediate position, taken by many psychological models of judgment and decision making, is that values are computed but that the resulting choices depend heavily on the context of available options. At the other extreme, the ‘comparison-only’ view argues that choice depends directly on comparisons, with or even without any intermediate computation of value. In this paper, we place past and current psychological and neuroscientific theories on this spectrum, and review empirical data that have led to an increasing focus on comparison rather than value as the driver of choice.

Item Type:	Journal Article
Subjects:	B Philosophy. Psychology. Religion > BF Psychology
Divisions:	Faculty of Science > Psychology Faculty of Social Sciences > Warwick Business School
Library of Congress Subject Headings (LCSH):	Decision making, Choice (Psychology)
Journal or Publication Title:	Trends in Cognitive Sciences
Publisher:	Elsevier BV
ISSN:	13646613
Date:	November 2011
Volume:	Vol.15
Number:	No.11
Page Range:	pp. 546-554
Identification Number:	10.1016/j.tics.2011.09.008
Status:	Peer Reviewed
Publication Status:	Published
Access rights to Published version:	Restricted or Subscription Access
Funder:	Economic and Social Research Council (Great Britain) (ESRC)
Grant number:	RES-062-23-0952 (ESRC), RES-062-23-2462 (ESRC)
References:	1 von Neumann, J., and Morgenstern, O. (1944) Theory of games and economic behavior. Princeton University Press, Princeton, NJ 2 Samuelson, P. (1937) A note on the measurement of utility. Rev. Econ. Stud. 4, 155–161 3 Robbins, L. (1938) Interpersonal comparisons of utility: A comment. Econ. J. 48, 635–641 4 Koszegi, B., and Rabin, M. (2006) A model of reference-dependent preferences. Q. J. Econ. 1221, 1133–1165 5 Rabin, M., and Weizsäcker, G. (2009) Narrow bracketing and dominated choices. Am. Econ. Rev. 99, 1508–1543 6 Loomes, G. (2005) Modelling the stochastic component of behaviour in experiments: some issues for the interpretation of data. Exp. Econ. 8, 301-323 7 Blavatskyy, P. (2007) Stochastic expected utility theory. J. Risk Uncertain. 34, 259–286 8 Larrick, R. P. (2004) Debiasing. In D. J. Koehler & N. Harvey (Eds.), Blackwell handbook of judgment and decision making. Oxford, England: Blackwell Publishers 9 Keeney, R.L., and Raiffa, H. (1976) Decisions with multiple objectives: Performances and value trade-offs. Wiley, New York 10 Glimcher, P., Camerer, C., Fehr, E., and Poldrack, R. (Eds.) (2009) Neuroeconomics: Decision making and the brain. New York: Elsevier 11 Starmer, C. (2000) Developments in non-expected utility theory: The hunt for a descriptive theory of choice under risk. J. Econ. Lit. 38, 332–382 12 Johnson, J. G., and Busemeyer, J. R. (2005) A dynamic, computational model of preference reversal phenomena. Psychol. Rev. 112, 841–861 13 Stewart, N., Chater, N., and Brown, G. D. A. (2006) Decision by sampling. Cogn. Psychol. 53, 1–26 14 Brandstätter, E., Gigerenzer, G., and Hertwig, R. (2006) The priority heuristic: Making choices without trade-offs. Psychol. Rev. 113, 409–432 15 Kahneman, D., and Tversky, A. (1979) Prospect theory: An analysis of decision under risk. Econometrica 47, 263–291 16 Tversky, A., and Kahneman, D. (1992) Advances in prospect theory: Cumulative representation of uncertainty. J Risk Uncertain. 5, 204–217 17 Quiggin, J. (1993) Generalized expected utility theory: The rank-dependent expected utility model. Kluwer-Nijhoff, Amsterdam 18 Bell, D. E. (1985) Disappointment in decision making under uncertainty. Oper. Res. 33, 1–27 19 Loomes, G., and Sugden, R. (1986) Disappointment and dynamic consistency in choice under uncertainty. Rev. Econ. Stud. LIII, 271–282 20 Birnbaum, M. (2008) New paradoxes of risky decision making. Psychol. Rev. 115, 463–501 21 Padoa-Schioppa, C., and Assad, J. A. (2008) The representation of economic value in the orbitofrontal cortex is invariant for changes of menu. Nat. Neurosci. 11, 95–102 22 Plassmann, H., O‘Doherty, J., and Rangel A. (2007) Orbitofrontal cortex encodes willingness to pay in everyday economic transactions. J. Neurosci. 27, 9984–9988 23 Camerer, C., Loewenstein, G., and Prelec, D. (2005) Neuroeconomics: How neuroscience can inform economics. J. Econ. Lit. XLIII, 9–64 24 Tom, S., Fox, C.R., Trepel, C. and Poldrack, R.A. (2007) The neural basis of loss aversion in decision making under risk. Science 315, 515–518 25 Trepel, C., Fox, C.R., and Poldrack, R.A. (2005) Prospect theory on the brain? Toward a cognitive neuroscience of decision under risk. Cogn. Brain Res. 23, 34–50 26 Hsee, C. K. (1996) The evaluability hypothesis: An explanation for preference reversals between joint and separate evaluations of alternatives. Organ. Behav. Hum. Decis. Process. 67, 247–257 27 Tversky, A. Slovic, P., and Kahneman, D. (1990) The causes of preference reversal. Am. Econ. Rev. 80, 204–217 28 Stewart, N., Chater, N., Stott, H. P., and Reimers, S. (2003) Prospect relativity: How choice options influence decision under risk. J. Exp. Psychol. Gen. 132, 23–46 29 Ungemach, C., Stewart, N., and Reimers, S. (2011) How incidental values from our environment affect decisions about money, risk, and delay. Psychol. Sci. 22, 253–260 30 Lichtenstein, S., and Slovic, P. (Eds.) (2006) The construction of preference. New York: Cambridge University Press 31 Fehr, E., and Schmidt K. (1999) A theory of fairness, competition and cooperation. Q. J. Econ. 114, 817–868 32 Clark, A.E., and Oswald, A.J. (1996) Satisfaction and comparison income. J. Public Econ. 61, 359–381 33 Boyce, C.J., Brown, G.D.A., and Moore, S.C. (2010) Money and happiness: Rank of income, not income, affects life satisfaction. Psychol. Sci. 21, 471–475 34 Brown, G.D.A., Gardner, J., Oswald, A.J., and Qian, J. (2008) Does wage rank affect employees‘ well-being? Ind. Relat. 47, 355–389 35 Loomes, G., and Sugden, R. (1982) Regret theory: An alternative theory of rational choice under uncertainty. Econ. J. 92, 805–824 36 Tversky, A., and Simonson, I. (1993) Context-dependent preferences. Manag. Sci. 39, 1179–1189 37 Gonzalez-Vallejo, C. (2002) Making trade-offs: A probabilistic and context-sensitive model of choice behavior. Psychol. Rev. 109, 137–154 38 Busemeyer, J. R., and Townsend, J. T. (1993) Decision field theory: A dynamic cognition approach to decision making. Psychol. Rev. 100, 432–459 39 Roe, R. M., Busemeyer, J. R., and Townsend, J. T. (2001) Multialternative decision field theory: A dynamic connectionist model of decision making. Psychol. Rev. 108, 370–392 40 Usher, M., and McClelland, J. L. (2001) On the time course of perceptual choice: The leaky competing accumulator model. Psychol. Rev. 108, 550–592 41 Loomes, G. (2010) Modeling choice and valuation in decision experiments. Psychol. Rev. 117, 902–924 42 Scholten, M., and Read, D. (2010) The psychology of intertemporal tradeoffs. Psychol. Rev. 117, 925–944 43 Parducci, A. (1995) Happiness, pleasure, and judgment: The contextual theory and its applications. Mahwah, NJ: Erlbaum 44 Seymour, B., and McClure, S. (2008) Anchors, scales and the relative coding of value in the brain. Curr. Opin. Neurobiol. 18, 173–178 45 Glimcher, P. (2009) Choice: Towards a standard back-pocket model. In P. Glimcher, C. Camerer, E. Fehr, and R. Poldrack (Eds.), Neuroeconomics: Decision making and the brain. New York: Elsevier 46 Laming, D. R. J. (1997) The measurement of sensation. London: Oxford University Press 47 Stewart, N., & Simpson, K. (2008) A decision-by-sampling account of decision under risk. In N. Chater & M. Oaksford (Eds.), The probabilistic mind: Prospects for Bayesian cognitive science (pp. 261-276). Oxford, England: Oxford University Press 48 Stewart, N. (2009) Decision by sampling: The role of the decision environment in risky choice. Q. J. Exp. Psychol. 62, 1041–1062 49 Tversky, A. (1969) Intransitivity of preferences. Psychol. Rev. 76 , 31–48 50 Brandstätter, E., Gigerenzer, G., & Hertwig, R. (2008). Risky choice with heuristics: Reply to Birnbaum (2008), Johnson, Schulte-Mecklenbeck & Willemsen (2008) and Rieger and Wang (2008). Psychol. Rev. 115, 281–290 51 Birnbaum, M. H., and LaCroix, A. R. (2008) Dimension integration: Testing models without trade-offs. Organ. Behav. Hum. Decis. Process. 105, 122–133 52 Birnbaum, M. H. (2010) Testing lexicographic semiorders as models of decision making: Priority dominance, integration, interaction, and transitivity. J. Math. Psychol. 54, 363–386 53 Gigerenzer, G. (2004) Fast and frugal heuristics: The tools of bounded rationality: In D. Koehler and N. Harvey (Eds.), Handbook of judgment and decision making (pp. 62–88) Oxford, England: Blackwell 54 Tversky, A. (1972) Elimination by aspects: A theory of choice. Psychol. Rev. 79, 281–299 55 Johnson, E.J., Haubl, G., and Keinan, A. (2007) Aspects of endowment: A query theory account of loss aversion for simple objects. J. Exp. Psychol. Learn. Mem. Cogn. 33, 461–474 56 Weber, E.U., Johnson, E.J., Milch, K.F., Chang, H., Brodscholl, J.C., and Goldstein, D.G. (2007) Asymmetric discounting in intertemporal choice: A query-theory account. Psychol. Sci. 18, 516–523 57 Shafir, E., Simonson, I., and Tversky, A. (1993) Reason-based choice. Cognition 49, 11–36 58 Reyna, V. F. (2008) A theory of medical decision making and health: Fuzzy-trace theory. Med. Decis. Making 28, 850–865 59 Stewart, N., Reimers, S., and Harris, A. J. (2011) Abandon revealed utility, subjective probability, and temporal discounting functions. Manuscript submitted for publication 60 Kornienko, T. (2010) A cognitive basis for context-dependent utility: An adaptive magnitude evaluation approach. Working paper 61 Wallach, H. (1948) Brightness constancy and the nature of achromatic colors. J. Exp. Psychol. 38, 310–324 62 Riskey, D. R., Parducci, A., and Beauchamp, G. K. (1979) Effects of context in judgments of sweetness and pleasantness. Percept. Psychophys. 26, 171–176 63 Parducci, A., and Perrett, L. F. (1971) Category rating scales: Effects of relative spacing and frequency of stimulus values. J. Exp. Psychol. 89, 427–452 64 Barlow, H. B. (1991) Possible principles underlying the transformation of sensory messages. In W. A. Rosenblith (Ed.), Sensory communication (pp. 217–234) Cambridge, MA: MIT Press 65 Birnbaum, M. H. (1992) Violations of monotonicity and contextual effects in choice-based certainty equivalents. Psychol. Sci. 3, 310–314 66 Vlaev, I., Chater, N., and Stewart, N. (2007) Financial prospect relativity: Context effects in financial decision-making under risk. J. Behav. Decis. Making 20, 273–304 67 Vlaev, I., and Chater, N. (2006) Game relativity: How context influences strategic decision making. J. Exp. Psychol. Learn. Mem. Cogn. 32, 131–149 68 Vlaev, I., Seymour, B., Dolan, R., and Chater, N. (2009) The price of pain and the value of suffering. Psychol. Sci. 20, 309–317 69 Ariely, D., Loewenstein, G., and Prelec, D. (2003) Coherent arbitrariness: Stable demand curves without stable preferences. Q. J. Econ. 118, 73–105 70 Dayan, P., and Seymour, B. (2008) Value and actions in aversion. In: P. W. Glimcher, C. F. Camerer, E. Fehr and R. A. Poldrack (Eds.), Neuroeconomics: Decision making and the brain. London, UK: Elsevier 71 Nieuwenhuis, S., Heslenfeld, D. J., von Geusau, N. J., Mars, R. B., Holroyd, C. B., and Yeung, N. (2005) Activity in human reward-sensitive brain areas is strongly context dependent. Neuroimage 25, 1302–1309 72 Tobler, P. N., Fiorillo, C. D., and Schultz, W. (2005) Adaptive coding of reward value by dopamine neurons. Science 307, 1642–1645 73 Tremblay, L., and Schultz, W. (1999) Relative reward preference in primate orbitofrontal cortex. Nature 398, 704–708 74 Elliott, R., Agnew, Z., and Deakin, J. F. (2008) Medial orbitofrontal cortex codes relative rather than absolute value of financial rewards in humans. Eur. J. Neurosci. 27, 2213–2218 75 Hosokawa, T., Kato, K., Inoue, M., and Mikami, A. (2007) Neurons in the macaque orbitofrontal cortex code relative preference of both rewarding and aversive outcomes. Neurosci. Res. 57, 434–445 76 Platt, M., and Padoa-Schioppa, C. (2009) Neuronal representations of value. In P. Glimcher, C. Camerer, E. Fehr, and R. Poldrack (Eds.), Neuroeconomics: Decision making and the brain. New York: Elsevier 77 Bentham, J. (1970) An introduction to the principles of morals and legislation (J. H. Burns and H. L. A. Hart, Eds.) London: The Athlone Press (Original work published in 1789) 78 Fechner, G. T. (1966) Elements of psychophysics (H. E. Adler, Trans.) New York: Holt, Rinehart, and Winston. (Original work published 1860) 79 Thurstone, L. L. (1959) The measurement of values. Chicago: University of Chicago Press 80 Loewenstein, G., and Ubel, P. A. (2008) Hedonic adaptation and the role of decision and experience utility in public policy. J. Pol. Econ. 92, 1795–1810
URI:	http://wrap.warwick.ac.uk/id/eprint/40844

Request changes to a record

Actions (login required)

View Item