Psychophysics of perception in decision making: the additive property of the intertemporal degree of inconsistency and a new proposal for the probability weighting function.

Author(s)

Natália Destefano

• Document type: Doctoral Thesis
• Press: Ribeirão Preto.
• Institution: Universidade de São Paulo (USP). Faculdade de Filosofia, Ciências e Letras de Ribeirão Preto (PCARP/BC)
• Defense date: 2013-06-20

Examining board members

Alexandre Souto Martinez; Jose Lino Oliveira Bueno; Celia Beatriz Anteneodo de Porto; Evandro Marcos Saidel Ribeiro

• Advisor: Alexandre Souto Martinez

Abstract

Intertemporal decision making are influenced not only by the effect of the reward value discount at different moments, but also by the time perception effect. One of the main difficulties that affects standard experiments involving intertemporal choices is the simultaneity of both effects on the discount. Through the unification of the psychophysical laws of delay perception and their association to the value discounting functions, we proposed a generalized process for the intertemporal discount involving both domains. We also showed that the additive property of the inconsistency degree, quantity obtained from the discount functions, allowed us to distinguish between both effects in decision making. As proposed for intertemporal choices, we extended the psychophysical perception theory to the probabilities domain. Adopting the perspective that the average delay for receiving a reward is related to the probability of receiving it, we obtained a probabilistic discount function covering value discounting and probability perception. Parallel to the experimental development, we also explored theoretical models that underlie probabilistic decision making. We proposed that the shape of the probability weighting function, explored in models such as rank-dependent expected utility theory and cumulative prospect theory, should be described by the generalized probabilistic function that we obtained from the phenomenological models. Therefore, the weighting function is supported by phenomenological models and derives from the assumption that subjects behave similarly in front of probabilities and delays. (AU)

• FAPESP's process: 09/17733-5 - Objectivity and Subjectivity Models in Inconsistency/Impulsivity and Risk Aversion in Decision Making.
• Grantee: Natália Destefano
• Support Opportunities: Scholarships in Brazil - Doctorate