An overall probability of winning heuristic for complex risky decisions: Choice and eye fixation evidence

• Published in: Organizational behavior and human decision processes Vol. 125; no. 2; pp. 73 - 87
• Main Authors: Venkatraman, Vinod, Payne, John W., Huettel, Scott A.
• Format: Journal Article
• Language: English
• Published: New York Elsevier Inc 01-11-2014; Elsevier Science Publishing Company, Inc
• Subjects: Adaptive decision making; Decision making; Difference; Evidence; Eye movements; Eye tracking; Heuristic; Heuristics; Personality psychology; Probability; Process measures; Risky choice; Risky choice models; Strategic planning; Strategies; Studies; Process measures; Heuristics; Strategies; Risky choice; Eye tracking; Risky choice models; Adaptive decision making
• ISSN: 0749-5978; 1095-9920
• DOI: 10.1016/j.obhdp.2014.06.003

•People maximize the overall probability of winning when faced with complex gambles.•Information processing and choice differs across decision contexts.•Pre-decisional eye-tracking data predicts choice on individual decision problems.•Findings are more consistent with the use of multiple strategies in risky choice.
When faced with multi-outcome gambles involving possibilities of both gains and losses, people often use a simple heuristic that maximizes the overall probability of winning (Pwin). Across three different studies, using choice data as well as process data from eye tracking, we demonstrate that the Pwin heuristic is a frequently used strategy for decisions involving complex (multiple outcome) mixed gambles. Crucially, we show systematic contextual and individual differences in the use of Pwin heuristic. We discuss the implication of these findings in the context of the broader debate about single versus multiple strategies in risky choice, and the need to extend the study of risky decision making from simple to more complex gambles.