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The role of memory in distinguishing risky decisions from experience and description
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Madan, Christopher R., Ludvig, Elliot Andrew and Spetch, Marcia L. (2016) The role of memory in distinguishing risky decisions from experience and description. Quarterly Journal of Experimental Psychology, 70 (10). 2048-2059 . doi:10.1080/17470218.2016.1220608 ISSN 1747-0218.
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Official URL: http://dx.doi.org/10.1080/17470218.2016.1220608
Abstract
People’s risk preferences differ for choices based on described probabilities versus those based on information learned through experience. For decisions from description, people are typically
more risk averse for gains than losses. In contrast, for decisions from experience, people are sometimes more risk seeking for gains than losses, especially for choices with the possibility of extreme outcomes (big wins or big losses), which are systematically overweighed in memory. Using a within-subject design, this study evaluated whether this memory bias plays a role in the differences in risky choice between description and experience. As in previous studies, people were more risk seeking for losses than for gains in description but showed the opposite pattern in experience. People also more readily remembered the extreme outcomes and judged them as having occurred more frequently. These memory biases correlated with risk preferences in
decisions from experience but not in decisions from description. These results suggest that systematic memory biases may be responsible for some of the differences in risk preference across description and experience.
| Item Type: | Journal Article | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Subjects: | B Philosophy. Psychology. Religion > BF Psychology H Social Sciences > HB Economic Theory |
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| Divisions: | Faculty of Science, Engineering and Medicine > Science > Psychology | ||||||||
| Library of Congress Subject Headings (LCSH): | Risk, Decision making, Memory | ||||||||
| Journal or Publication Title: | Quarterly Journal of Experimental Psychology | ||||||||
| Publisher: | Taylor & Francis | ||||||||
| ISSN: | 1747-0218 | ||||||||
| Official Date: | 7 September 2016 | ||||||||
| Dates: |
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| Volume: | 70 | ||||||||
| Number: | 10 | ||||||||
| Page Range: | 2048-2059 | ||||||||
| DOI: | 10.1080/17470218.2016.1220608 | ||||||||
| Status: | Peer Reviewed | ||||||||
| Publication Status: | Published | ||||||||
| Access rights to Published version: | Restricted or Subscription Access | ||||||||
| Date of first compliant deposit: | 5 August 2016 | ||||||||
| Date of first compliant Open Access: | 12 August 2017 | ||||||||
| Funder: | Alberta Gambling Research Institute (AGRI), Natural Sciences and Engineering Research Council of Canada (NSERC) | ||||||||
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