What do you think?
Rate this book
Rational Choice in an Uncertain World: The Psychology of Judgement and Decision Making
In Rational Choice in an Uncertain World , renowned authors Hastie and Dawes compare the basic principles of rationality with actual behavior in making decisions. They describe theories and research finding from the field of judgement and decision making in a non-technical manner, using anecdotes as a teaching device. Intended as an introductory textbook for advanced undergraduate and graduate students, the material not only is of scholarly interest but is practical as well.
392 pages, Paperback
First published April 1, 1988
57 people are currently reading
1496 people want to read
Ratings & Reviews
Friends & Following
Create a free account to discover what your friends think of this book!
Community Reviews
Displaying 1 - 15 of 15 reviews
January 9, 2022
What kind of book is this?
This is an expository work; more specifically, it is a theoretical textbook.
Rational & Why I read this book
2021 is my year of ratio & will. I try to read various books with various angles on rationality. A highly scientific standpoint should of course also be part of that.
The unity of the book — what is the book about as a whole?
This is a book about rational decision-making based on what we know about it from science (I read the 2001 version).
The book's structure
The book has 14 main chapters with 4-7 subchapters each (350 pages).
1. Thinking and Deciding
2. What Is Decision Making?
3. A General Framework for Judgment
4. Judgments From Memory
5. Anchoring and Adjustment
6. Judgment by Similarity
7. Judging by Scenarios and Explanations
8. Thinking About Randomness and Causation
9. Thinking Rationally About Uncertainty
11. Evaluating Consequences: Simple Values
12. Complex Values and Attitudes
13. A Normative, Rational Decision Theory
14. In Praise of Uncertainty
X. Appendix on the basic principles of probability theory.
One particular lesson
A passage I found relevant for my personal life:
"Children who see little contingency between their own behavior and their rewards and punishments often behave badly, or at least we can improve their behavior by increasing the contingency. In addition, employees who believe that they have control over the rewards they receive for their work are motivated to work hard and be productive. Consequently, employers and supervisors are well advised to establish a contingency between employee accomplishments and rewards. ... Rationally, it often doesn't matter how much control we have over outcomes-so long as we have some" (p. 324)
Judgement & Recommendations - Who should read this?
This is a textbook intended for students, albeit a somewhat approachable one. It took me several weeks to finish and I even skipped one chapter which I didn't find relevant for me. Therefore, I would not recommend this as a whole to the average reader. If you are researching a certain topic or if you have a deep interest in one of the covered topics, you maybe can use it as a reference work (read-only part of the book and fetch the mentioned resources). Otherwise, I'd recommend you choose other books like Tools Of Critical Thinking: Metathoughts For Psychology and The Art of Clear Thinking (if you are interested in improving your thinking in practice) instead. They are of a more practical nature. Overall, I appoint it a 6 out of 10 (⭑⭑⭑) on my personal rating scale.
-----------
Find my other book reviews at: https://www.dennisnehrenheim.com/read
This is an expository work; more specifically, it is a theoretical textbook.
Rational & Why I read this book
2021 is my year of ratio & will. I try to read various books with various angles on rationality. A highly scientific standpoint should of course also be part of that.
The unity of the book — what is the book about as a whole?
This is a book about rational decision-making based on what we know about it from science (I read the 2001 version).
The book's structure
The book has 14 main chapters with 4-7 subchapters each (350 pages).
1. Thinking and Deciding
2. What Is Decision Making?
3. A General Framework for Judgment
4. Judgments From Memory
5. Anchoring and Adjustment
6. Judgment by Similarity
7. Judging by Scenarios and Explanations
8. Thinking About Randomness and Causation
9. Thinking Rationally About Uncertainty
11. Evaluating Consequences: Simple Values
12. Complex Values and Attitudes
13. A Normative, Rational Decision Theory
14. In Praise of Uncertainty
X. Appendix on the basic principles of probability theory.
One particular lesson
A passage I found relevant for my personal life:
"Children who see little contingency between their own behavior and their rewards and punishments often behave badly, or at least we can improve their behavior by increasing the contingency. In addition, employees who believe that they have control over the rewards they receive for their work are motivated to work hard and be productive. Consequently, employers and supervisors are well advised to establish a contingency between employee accomplishments and rewards. ... Rationally, it often doesn't matter how much control we have over outcomes-so long as we have some" (p. 324)
Judgement & Recommendations - Who should read this?
This is a textbook intended for students, albeit a somewhat approachable one. It took me several weeks to finish and I even skipped one chapter which I didn't find relevant for me. Therefore, I would not recommend this as a whole to the average reader. If you are researching a certain topic or if you have a deep interest in one of the covered topics, you maybe can use it as a reference work (read-only part of the book and fetch the mentioned resources). Otherwise, I'd recommend you choose other books like Tools Of Critical Thinking: Metathoughts For Psychology and The Art of Clear Thinking (if you are interested in improving your thinking in practice) instead. They are of a more practical nature. Overall, I appoint it a 6 out of 10 (⭑⭑⭑) on my personal rating scale.
-----------
Find my other book reviews at: https://www.dennisnehrenheim.com/read
September 11, 2007
Great book. Recommended by a smart friend ;-)
This book delves into how we make choices (duh). It does it from a clinical psychology point-of-view. But done right. Her statistics (both in theory and in practice) are what one would wish everyone in clinical work would use. When she drops into conjecture, she points it out herself.
Valuable ideas from the book:
1) what makes a good, rational choice
- specifically, I liked how a rational choice is one that looks at all the options at hand and then makes the most informed decision
- informed by information as well as HOW we access information
- this does a bit of damage to Blink putting Blink into a sociology category and not an actually cognitive / psychology category (where the book can be more fully enjoyed
2) Sunk Costs
- loved this part. It's the idea that we hold onto things from the past and let them influence the present poorly. For example, "I can't give up on _____ because I've invested so much time in it!" even though continuing will cause more pain than the payoff.
- the section in here on addiction was fascinating AND helpful!
3) Combinations have more intuitive weight than items alone
- one idea may be thought to have slim chance of success, unless it is paired with something (equally, more, or less likely - weird!).
4) Making a list of pro's and con's, weighting them, then deciding has much better success than the best-guess of a master in a top - most of the time!
5) It is much easier to replace a theory someone has than it is to disprove it. Even though 'science' is MUCH better at disproving theories - the "scientific method," for example, cannot replace the hypotheses but can only (in)validate them.
Some pretty technical stuff in the book but still highly accessible.
If you want to think about how you think, that is.
This book delves into how we make choices (duh). It does it from a clinical psychology point-of-view. But done right. Her statistics (both in theory and in practice) are what one would wish everyone in clinical work would use. When she drops into conjecture, she points it out herself.
Valuable ideas from the book:
1) what makes a good, rational choice
- specifically, I liked how a rational choice is one that looks at all the options at hand and then makes the most informed decision
- informed by information as well as HOW we access information
- this does a bit of damage to Blink putting Blink into a sociology category and not an actually cognitive / psychology category (where the book can be more fully enjoyed
2) Sunk Costs
- loved this part. It's the idea that we hold onto things from the past and let them influence the present poorly. For example, "I can't give up on _____ because I've invested so much time in it!" even though continuing will cause more pain than the payoff.
- the section in here on addiction was fascinating AND helpful!
3) Combinations have more intuitive weight than items alone
- one idea may be thought to have slim chance of success, unless it is paired with something (equally, more, or less likely - weird!).
4) Making a list of pro's and con's, weighting them, then deciding has much better success than the best-guess of a master in a top - most of the time!
5) It is much easier to replace a theory someone has than it is to disprove it. Even though 'science' is MUCH better at disproving theories - the "scientific method," for example, cannot replace the hypotheses but can only (in)validate them.
Some pretty technical stuff in the book but still highly accessible.
If you want to think about how you think, that is.
May 1, 2007
A good overview and introduction to the psychology of judgment and decision making. Second only to Scott Plous's book on the same topic and considerably more accurate than any of Malcolm Gladwell's recent texts on the topic.
April 30, 2018
Great book describing how humans think and how we can make more rational decisions. It's pretty accessible if you have a decent math/statistics background, while still being theoretical (which I like.) However, it's not too theoretical like other decision making theory texts. Even though the author does make opinionated claims, the author always states that it's their opinion, and also provides counterpoints.
March 20, 2007
My advisor's book. So basically my Bible.
July 31, 2025
Hastie and Dawe’s work is my first fully-fledged introduction to the world of decision-making research. Therefore I can’t testify to it’s quality in comparison to other manuals on the topic. I can, however, compare it to other academic works I’ve read. I’ve enjoyed reading through all of it, although I do find it heavy on the mathematics of probability. I believe the authors mend well the research that’s been done on the topic and the philosophical and practical implications of the findings of all this body of research. I can say now that I see our decision-making process and the way science (and us) deals with the uncertainties of the world in a different perspective. In theory, if we are to achieve our goals, we should act rationally. And yet, while we have the capacity to act rationally, we do not have the capability of doing so all the time. Thinking well requires time, great effort and practice. Instead, we put the most weight in everyday decisions on our heuristics, our biases. That I already knew of quite well. What this book has taught me, is the caveats that surround it. Heuristic decision-making has its strengths, and in theory long term, with its ability to economically save ressources and cognitive effort, it might be even more so adaptive in the long term. One of these heuristics, the most profound one, is our desire for certainty. I disagree with the authors that we function under a world of uncertainty, and that we should simply « accept » these uncertainties. They maintain that the more we try to explain the world, the more we end up over-fitting incomplete models through unverified causal chains. We should trust the probabilities, and even more so the math and calculations that we can use to solve our problems for us. In the first chapter, they argue quite convincingly that simply summing up and weighing factors into a linear model has more predictive power than using our biased and imperfect intuitions. I disagree with them on the way we should view probabilities. Probabilities do not represent the actual chances that some event will happen or not, and we would be greatly mistaken to put excessive weight on them. Probabilities do not measure randomness. Everything has causes, every event has influences that can be identified. The objective of probabilities is to number our uncertainty regarding those events. The world isn’t random except only at the subatomic and quantic levels. The world isn’t « probabilistic ». At the macro-level, the world is deterministic, and to view it any other way is I think a mistake I can attribute to the authors. But this should not distract the readers from the great quality that is this book. It is a phenomenal work that should be appreciated, only refined in terms of philosophical coherence.
December 10, 2018
I'd really rather cognitive psychologists trashed the anti-Logos propaganda they've been poisoned with.
"Linda is a bank teller and a feminist."
"Ok"
"What is she?"
"A bank teller and a feminist"
"lolololololol muh flawed mind! See! People can't reason!"
"Linda is a bank teller and a feminist."
"Ok"
"What is she?"
"A bank teller and a feminist"
"lolololololol muh flawed mind! See! People can't reason!"
Read
January 15, 2022I need to give up reading this book since the concepts are all too familiar to me (from all sorts of other books I've read in the past).
April 4, 2009
The primer to heuristics and biases. Short and to the point. No experimental info. Good writing. Engaging. Step one.
You have both a biased experience upon which to draw and a biased memory of that experience.
Quotes:
"I take the position that research - not anecdote, not "plausible" belief, not common sense, and not our everyday experience - should be the basis for understanding and evaluating our decision making."
"abandon the self-attribution process altogether. "Shut up to yourself about yourself. What you say might be a trap, and it probably isn't true anyway."
"The resulting value function is steeper for losses than for gains." (It hurts more to lose a dollar than to gain one, also the average of two expected utilities is closer to zero than the expected utility of the average. Think about the s curve.)
"Organizations often search through the set of possible alternatives until they find one that satisfies an aspiration level, and then they terminate their search...satisficing - as opposed to optimizing."
"The consideration of all relevant possibilities and consequences involves decision costs, which are very difficult to integrate with the costs and benefits of payoffs."
"Do not propose solutions until the problem has been discussed as thoroughly as possible without suggesting any."
"Probability estimates are often based on the degree to which characteristics are representative of schemas or other characteristics, and that such representativeness does not necessarily reflect an actual contingency."
"How prevalent is his category? Such a judgment invites the evaluation of base rates, independent of the characteristic."
(Availability bias) "When we have experience with a class of phenomena those with a particularly salient characteristic are those that most readily "come to mind" when we think about that class. It follows that if we estimate the proportion of members of that class with whom we have had experience and who have that characteristic, we tend to overestimate it."
"While memory from our experience is introspectively a process of "dredging up" what actually happened, it is to a large extent determined by our current beliefs and feelings."
(Narrative bias) "By viewing consequences as inevitable results of choice, we create a phony coherence in our experience, and if we believe in that coherence too much, it offers a poor basis for making decisions about the future."
(Hindsight bias) "People who know the nature of events falsely overestimate the probability with which they would have predicted it."
"The most common anchor, of course, is the status quo."
"When we concentrate on scenarios, we develop a false sense of security by taking precautions against them."
"Focusing policy on affecting the thoughts, motives, and feelings of the present leaders of a competing nation is a mistake. It is ignoring base rates in favor of dubious individuating information."
"A final objective is the "10,000 Frenchmen can't be wrong" one. Experts have been revered - and well paid - for years for their "it is my opinion that" judgments. As James March points out, however, such reverence may serve a purely social function. People and organizations have to make decisions, often between alternatives that appear equally good or bad. What better way to justify such decisions than to consult any intuitive expert, and the more money she or he charges, the better. "We paid for the best possible medical advice" can be a palliative for a fatal operation, just as "throwing" the I Ching can relieve someone of regretting a bad marriage."
"If 36 people have an intuitive feeling that the next roll of the dice will be snake-eyes and are willing to bet even odds on that hunch, on the average one will win. That person is the one most likely to come to our attention; for one thing, the others probably won't talk about it much."
"When presented with the very same handwriting samples twice, the graphologist made totally inconsistent judgments."
"The most effective method of attacking a belief based on plausibility is not presenting disconfirming evidence, but rather providing a new plausible hypothesis."
You have both a biased experience upon which to draw and a biased memory of that experience.
Quotes:
"I take the position that research - not anecdote, not "plausible" belief, not common sense, and not our everyday experience - should be the basis for understanding and evaluating our decision making."
"abandon the self-attribution process altogether. "Shut up to yourself about yourself. What you say might be a trap, and it probably isn't true anyway."
"The resulting value function is steeper for losses than for gains." (It hurts more to lose a dollar than to gain one, also the average of two expected utilities is closer to zero than the expected utility of the average. Think about the s curve.)
"Organizations often search through the set of possible alternatives until they find one that satisfies an aspiration level, and then they terminate their search...satisficing - as opposed to optimizing."
"The consideration of all relevant possibilities and consequences involves decision costs, which are very difficult to integrate with the costs and benefits of payoffs."
"Do not propose solutions until the problem has been discussed as thoroughly as possible without suggesting any."
"Probability estimates are often based on the degree to which characteristics are representative of schemas or other characteristics, and that such representativeness does not necessarily reflect an actual contingency."
"How prevalent is his category? Such a judgment invites the evaluation of base rates, independent of the characteristic."
(Availability bias) "When we have experience with a class of phenomena those with a particularly salient characteristic are those that most readily "come to mind" when we think about that class. It follows that if we estimate the proportion of members of that class with whom we have had experience and who have that characteristic, we tend to overestimate it."
"While memory from our experience is introspectively a process of "dredging up" what actually happened, it is to a large extent determined by our current beliefs and feelings."
(Narrative bias) "By viewing consequences as inevitable results of choice, we create a phony coherence in our experience, and if we believe in that coherence too much, it offers a poor basis for making decisions about the future."
(Hindsight bias) "People who know the nature of events falsely overestimate the probability with which they would have predicted it."
"The most common anchor, of course, is the status quo."
"When we concentrate on scenarios, we develop a false sense of security by taking precautions against them."
"Focusing policy on affecting the thoughts, motives, and feelings of the present leaders of a competing nation is a mistake. It is ignoring base rates in favor of dubious individuating information."
"A final objective is the "10,000 Frenchmen can't be wrong" one. Experts have been revered - and well paid - for years for their "it is my opinion that" judgments. As James March points out, however, such reverence may serve a purely social function. People and organizations have to make decisions, often between alternatives that appear equally good or bad. What better way to justify such decisions than to consult any intuitive expert, and the more money she or he charges, the better. "We paid for the best possible medical advice" can be a palliative for a fatal operation, just as "throwing" the I Ching can relieve someone of regretting a bad marriage."
"If 36 people have an intuitive feeling that the next roll of the dice will be snake-eyes and are willing to bet even odds on that hunch, on the average one will win. That person is the one most likely to come to our attention; for one thing, the others probably won't talk about it much."
"When presented with the very same handwriting samples twice, the graphologist made totally inconsistent judgments."
"The most effective method of attacking a belief based on plausibility is not presenting disconfirming evidence, but rather providing a new plausible hypothesis."
This entire review has been hidden because of spoilers.
November 17, 2009
This book was actually one of the best I have ever read for a class in my undergraduate, masters, and doctoral studies. (And it was for a managerial accounting class!) I would give it five stars, but I thought it got a bit slow towards the end. It definitely helped me understand how my own thought processes are flawed and how to make better decisions and judgments. As my exam is tomorrow, I thought I would write a review today to help summarize some of my thoughts about why it was so interesting and helpful. So I apologize that this review is a bit long, but feel free to just skip to the last paragraph to read my personal opinions about the book if you aren’t interested in the examples.
Hastie and Dawes describe two types of thought processes: automatic and controlled. An automatic thought involves reacting to something not actually in your environment. Such as while driving a car, you respond to the expectation that the light will be red before you get there. Controlled thought is considered scientific reasoning. Hastie and Dawes assert that more of our thought processes are automatic than we might realize. The authors hypothesize that the human mind is a limited mind; we do not perfectly recall all our previous experiences and choices. This results in “bounded” irrational thinking which is actually systematic in its own way. There were two examples of this that really struck home with me: judgments from memory and anchoring and adjusting.
Judgments from memory are often completely incorrect because we draw from a biased sample. In other words, we remember things that are more memorable, or more salient. For example, do you think there are more six letter words that have the form ---- n - versus ---ing? Most people would say there are more words ending in –ing, but that is incorrect. It is simply because it is easier for us to remember more words ending in –ing. We remember the things that are most salient (such as every time we forget our umbrella it rains), but these are biased memories.
We also remember things based on our emotional mood state. Johnson and Tversky (1983) asked participants to make ratings of risk and accidents. The participants who were exposed to more negative news stories in the waiting room before the experiment produced systematically higher ratings of the risks than subjects who overheard happy or neutral news stories.
An example of anchoring and adjusting is that we color our memories of the past with our current beliefs. Markus (1986) studied people’s political attitudes between 1979 and 1982. He found that on an overall scale of liberal/conservative, the subjects’ recall of their 1979 political beliefs in 1982 was much more closely related to their actual beliefs in 1982 than to the political attitude they had actually expressed in 1979!
Aside from helping me understand judgment and decision making research in accounting, this book made me think deeply about how my own biased recall, emotional states, and current (versus past) beliefs are affecting my day-to-day decisions and judgments. Actually, since I tend to be a worrier, this book made me feel a bit better about setting aside some of the nastier things that pop into my head when I make decisions (i.e., maybe everyone who ever did X did not necessarily experience horrible result Y afterwards). If you are interested at all in the psychology of our decision processes or just want to have a more balanced view of how to make your own decisions, I highly recommend this book.
Hastie and Dawes describe two types of thought processes: automatic and controlled. An automatic thought involves reacting to something not actually in your environment. Such as while driving a car, you respond to the expectation that the light will be red before you get there. Controlled thought is considered scientific reasoning. Hastie and Dawes assert that more of our thought processes are automatic than we might realize. The authors hypothesize that the human mind is a limited mind; we do not perfectly recall all our previous experiences and choices. This results in “bounded” irrational thinking which is actually systematic in its own way. There were two examples of this that really struck home with me: judgments from memory and anchoring and adjusting.
Judgments from memory are often completely incorrect because we draw from a biased sample. In other words, we remember things that are more memorable, or more salient. For example, do you think there are more six letter words that have the form ---- n - versus ---ing? Most people would say there are more words ending in –ing, but that is incorrect. It is simply because it is easier for us to remember more words ending in –ing. We remember the things that are most salient (such as every time we forget our umbrella it rains), but these are biased memories.
We also remember things based on our emotional mood state. Johnson and Tversky (1983) asked participants to make ratings of risk and accidents. The participants who were exposed to more negative news stories in the waiting room before the experiment produced systematically higher ratings of the risks than subjects who overheard happy or neutral news stories.
An example of anchoring and adjusting is that we color our memories of the past with our current beliefs. Markus (1986) studied people’s political attitudes between 1979 and 1982. He found that on an overall scale of liberal/conservative, the subjects’ recall of their 1979 political beliefs in 1982 was much more closely related to their actual beliefs in 1982 than to the political attitude they had actually expressed in 1979!
Aside from helping me understand judgment and decision making research in accounting, this book made me think deeply about how my own biased recall, emotional states, and current (versus past) beliefs are affecting my day-to-day decisions and judgments. Actually, since I tend to be a worrier, this book made me feel a bit better about setting aside some of the nastier things that pop into my head when I make decisions (i.e., maybe everyone who ever did X did not necessarily experience horrible result Y afterwards). If you are interested at all in the psychology of our decision processes or just want to have a more balanced view of how to make your own decisions, I highly recommend this book.
November 20, 2022
felt slow, but it's a comprehensive textbook, not a narrative
September 20, 2016
Ok everyone read this book, at least if you're not already inundated with this same information from all sides. Even if you are, every repetition drives it in further, and this one especially is good for wiggling it into your stupid human brain by putting it in terms your stupid human brain can process good.
I rather enjoy Dawes' opinions and (one might call them) rants throughout the book. That said, here's some nitpicking. He has this bit at the end about how certain knowledge precludes ethics. I'm not sure I really buy that - maybe it can fall at so simple a rebuttal as, even if we know exactly what the outcomes of our actions will be, that doesn't specify which of two possible outcomes is preferable. But mainly when I try to follow his logic I end up going DOES NOT COMPUTE because I, personally, can't envision knowing the result of some action beyond some maximum time limit, due to branching possibilities as well as knowledge propagation only going so fast so the entirety of its effects are too hard for me to know. Yes Bria but this is a hypothetical counterfactual, to illustrate the - BUT IT'S NOT REALLY FEASIBLE. Ok but imagine that - I CAN'T THIS DOESN'T MAKE SENSE ERROR
I rather enjoy Dawes' opinions and (one might call them) rants throughout the book. That said, here's some nitpicking. He has this bit at the end about how certain knowledge precludes ethics. I'm not sure I really buy that - maybe it can fall at so simple a rebuttal as, even if we know exactly what the outcomes of our actions will be, that doesn't specify which of two possible outcomes is preferable. But mainly when I try to follow his logic I end up going DOES NOT COMPUTE because I, personally, can't envision knowing the result of some action beyond some maximum time limit, due to branching possibilities as well as knowledge propagation only going so fast so the entirety of its effects are too hard for me to know. Yes Bria but this is a hypothetical counterfactual, to illustrate the - BUT IT'S NOT REALLY FEASIBLE. Ok but imagine that - I CAN'T THIS DOESN'T MAKE SENSE ERROR
March 18, 2017
This seems like a very thorough and accessible introduction to the subject. I was pleasantly surprised at the amount of it that wasn't simply review for me, but even what was review was presented very well. I disagree with some of the stances the authors' seem to take (though subtly) on particular theories within the field. Otherwise, though, I quite enjoyed it. I'm not willing to give it five stars, though, because it's the first intro book in the field that I've read cover-to-cover, so since I'm not as familiar with what else is out there, I don't want to give the impression that I think this book is the best on offer.
December 19, 2011
Excellent book to get insight into decision making. Gives a scary picture about how not rational we typically make decisions.
Gives some good suggestions about formal processes to structure decisions.
Nice connection to DAR in CMMI
Gives some good suggestions about formal processes to structure decisions.
Nice connection to DAR in CMMI
Read
October 20, 2013Not bad, but very philosophical.
I had a hard time getting through chapters and understanding the point the author was trying to make.
I had a hard time getting through chapters and understanding the point the author was trying to make.
Displaying 1 - 15 of 15 reviews