Speed-Accuracy Tradeoffs in Sample-Based Judgment and Choice

• Applicant: Professor Dr. Klaus Fiedler
• Subject Area: Social Psychology, Industrial and Organisational Psychology ; General, Cognitive and Mathematical Psychology
• Term: from 2020 to 2023
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 437923996

The present research project focuses on speed-accuracy tradeoffs in sample-based decisions. With increasing information sampled about two choice options, the expected accuracy increases while decision speed will decrease inevitably. A tradeoff arises as the time expended to increase accuracy can be used to increase the number of correct decisions completed within the available time. Previous research has largely neglected these tradeoffs, which are however quite common in many areas of everyday life. In our preliminary work, an experimental task was developed that allows participants to determine the amount of information sampled before they make a choice. On every trial of a sequential task, participants make a choice between two investment funds, based on binomial random samples of the two investment funds’ success on n randomly selected days. Participants win 1 payoff unit for each correct choice (of the option with the higher success rate in the population from which the sample is drawn) and they lose 1 unit for each incorrect choice. Because the total payoff is the product of the average payoff (accuracy) and the number of choices completed (speed), participants have to be both accurate and fast. However, crucially, because the number of completed choices decreases faster with increasing n than accuracy increases, a theoretically predictable finding is a dramatic accuracy bias. The vast majority of participants gather far too large samples, thereby missing the optimal number of completed choices by magnitudes. Three parallel experiments with students of psychology and economics and with depressed patients as participants corroborate this basic result. Oversampling persisted in spite of several manipulations (feedback; sample limit; choice difficulty; payoff scheme) devised to let participants experience the superiority of speedy strategies, reflecting a conspicuous metacognitive deficit. Even when participants could only win and never loose, they were reluctant to exploit speedy strategies. The goal of the depicted project is to understand and elaborate on this challenging phenomenon. First, we will replicate all preliminary findings in a new domain, independent of the surplus meaning of money investment. Second, computer simulations will determine optimal strategies for different stopping rules and sampling modes. Third, in a functional-level approach to delimit the failure to solve the tradeoff, we examine the impact of various interventions that force participants to experience the advantage of speedy strategies. The final part of the project is devoted to empirical tests of mechanistic account in terms of the evaluability notion propagated by Christopher Hsee. Accordingly, the accuracy bias can be eliminated and the dominant impact of speed will be appreciated when the presentation format renders the information cost of increasing samples more evaluable, relative to the evaluability of the payoff gained for accurate choices.

• DFG Programme: Research Grants