One of the most widely used procedures applied to non-human animals or pre-linguistic humans is the “violation of expectation paradigm”. Curiously there is almost no discussion in the philosophical literature about it. Our objective will be to provide a first approach to the meta-theoretical nature of the assumptions behind the procedure that appeals to the violation of expectation and to extract some consequences. We show that behind them exists an empirical principle that affirms that the violation of (...) the expectation of certain mental rules generates surprise. We then proceeded to discuss the nature of these “mental rules”. We show that, as is often the case with theoretical concepts proposed by theories, they do not have a fixed interpretation. This will allow us to show that the usual relationship found in the developmental psychology literature between this experimental paradigm and cognitive approaches (which interpret experimental results in terms of higher-level mental activities) is not necessary. Finally, we relate this experimental design with the mark test and the inequity aversion test and discuss the possible ampliation of the application of the empirical principle of violation of expectation. (shrink)

Expected utility theory often falls silent, even in cases where the correct rankings of options seems obvious. For instance, it fails to compare the Pasadena game to the Altadena game, despite the latter turning out better in every state. Decision theorists have attempted to fill these silences by proposing various extensions to expected utility theory. As I show in this paper, such extensions often fall silent too, even in cases where the correct ranking is intuitively obvious. But we (...) can extend the theory further than has been done before---I offer a new extension, Invariant Value Theory, which deals neatly with those problem cases and also satisfies various desirable conditions. But other prima facie desirable conditions, including Independence, the theory violates. Is this a problem for the proposal? It may not be---in a new impossibility result, I show that no theory can satisfy Independence in full generality without violating several other conditions that together seem just as plausible. (shrink)

This paper presents the results of two experiments designed to test violations of Subjective Expected Utility Theory (SEUT) within a sample of Italian trade union delegates and leaders. Subjects priced risky and ambiguous prospects in the domain of gains. Risky prospects were based on games of chance, while ambiguous prospects were built on the standard Ellsberg paradox and on event lotteries whose outcomes were based either on the results of a fictional election or on the future results of the (...) 1999 European Parliamentary election in Italy and the U.K. The experiments show that, although risky prospects were priced at their expected values on average, trade union delegates and leaders did violate SEUT when assessing ambiguous prospects. Moreover, their behaviour depended on the source of uncertainty (Ellsberg paradox vs. electoral results; fictional vs. real election; Italy vs. U.K. election outcomes). We discuss the implications of these results for the economic theory of the trade union. (shrink)

In decision theory, the betweenness axiom postulates that a decision maker who chooses an alternative A over another alternative B must also choose any probability mixture of A and B over B itself and can never choose a probability mixture of A and B over A itself. The betweenness axiom is a weaker version of the independence axiom of expected utility theory. Numerous empirical studies documented systematic violations of the betweenness axiom in revealed individual choice under uncertainty. This (...) paper shows that these systematic violations can be linked to another behavioral regularity—choice shifts in a group decision making. Choice shifts are observed if an individual faces the same decision problem but makes a different choice when deciding alone and in a group. (shrink)

Violations of expected utility theory are sometimes attributed to imprecise preferences interacting with a lack of learning opportunity in the experimental laboratory. This paper reports an experimental test of whether a learning opportunity which engenders accurate probability assessments, by enhancing understanding of the meaning of stated probability information, causes anomalous behaviour to diminish. The data show that whilst in some cases expected utility maximising behaviour increases with the learning opportunity, so too do systematic violations. Therefore, there should be no (...) presumption that anomalous behaviour under risk is transient and that discovered preferences will be appropriately described by expected utility theory. (shrink)

The majority consensus in the empirical literature is that probability weighting functions are typically inverse-S shaped, that is, people tend to overweight small and underweight large probabilities. A separate stream of literature has reported event-splitting effects and shown that they can explain violations of expected utility. This leads to the questions whether the observed shape of weighting functions is a mere consequence of the coalesced presentation and, more generally, whether preference elicitation should rely on presenting lotteries in a canonical split (...) form instead of the commonly used coalesced form. We analyze data from a binary choice experiment where all lottery pairs are presented in both split and coalesced forms. Our results show that the presentation in a split form leads to a better fit of expected utility theory and to probability weighting functions that are closer to linear. We thus provide some evidence that the extent of probability weighting is not an ingrained feature, but rather a result of processing difficulties. (shrink)

Our aim in this paper was to establish an empirical evaluation for similarity effects modeled by Rubinstein; Azipurua et al.; Leland; and Sileo. These tests are conducted through a sensitivity analysis of two well-known examples of expected utility (EU) independence violations. We found that subjective similarity reported by respondents was explained very well by objective measures suggested in the similarity literature. The empirical results of this analysis also show that: (1) the likelihood of selection for the riskier choice increases as (...) the pair becomes more similar, (2) these choice patterns are consistent with well-known independence violations of expected utility, and (3) a significant proportion of individuals exhibit intransitive choice patterns predicted under similarity effects, but not allowed under generalized expected utility models for risky choice. (shrink)

There is now considerable evidence that human sentence processing is expectation based: As people read a sentence, they use their statistical experience with their language to generate predictions about upcoming syntactic structure. This study examines how sentence processing is affected by readers' uncertainty about those expectations. In a self-paced reading study, we use lexical subcategorization distributions to factorially manipulate both the strength of expectations and the uncertainty about them. We compare two types of uncertainty: uncertainty about the verb's complement, reflecting (...) the next prediction step; and uncertainty about the full sentence, reflecting an unbounded number of prediction steps. We find that uncertainty about the full structure, but not about the next step, was a significant predictor of processing difficulty: Greater reduction in uncertainty was correlated with increased reading times. We additionally replicated previously observed effects of expectation violation, orthogonal to the effect of uncertainty. This suggests that both surprisal and uncertainty affect human RTs. We discuss the consequences for theories of sentence comprehension. (shrink)

Drawing on attribution theory and expectancy violation theory, this study investigates the effect of corporate social responsibility (CSR) on stock market reactions in the context of intentional crises, during which stakeholders are likely to attribute crisis responsibility to the focal firm. Using a sample of Chinese listed firms from 2012 to 2022, we find that in the context of an intentional crisis, the stock market reacts more negatively to firms with higher prior CSR performance. Two contingency (...) factors (i.e., media attention and state ownership) strengthen this negative relationship. This study contributes to the CSR literature by broadening knowledge of the insurance-like effects of CSR and by identifying a “boomerang effect” of CSR in the context of intentional crises. (shrink)

Framing effects occur when different descriptions of the same decision problem give rise to divergent decisions. They can be seen as a violation of the decisiontheoretic version of the principle of extensionality (PE). The PE in logic means that two logically equivalent sentences can be substituted salva veritate. We explore what this notion of extensionality becomes in decision contexts. Violations of extensionality may have rational grounds. Based on some ideas proposed by the psychologist Craig McKenzie and colleagues, we contend (...) that framing effects are justified when the selection of one particular frame conveys choice relevant information. We first discuss this idea from a philosophical point of view, and proceed next to formalize it first in the context of the Bolker–Jeffrey decision theory. Finally, we extend the previous analysis to non-expected utility theories using the Biseparable Preference model introduced by Ghirardato and Marinacci (2001) and therefore show that the analysis is independent of the assumptions of Bayesian decision theory. (shrink)

Quantum cognition in decision making is a recent and rapidly growing field. In this paper, we develop an expected utility theory in a context of non-classical uncertainty. We replace the classical state space with a Hilbert space which allows introducing the concept of quantum lottery. Within that framework, we formulate axioms on preferences over quantum lotteries to establish a representation theorem. We show that demanding the consistency of choice behavior conditional on new information is equivalent to the von Neumann–Lüders (...) postulate applied to beliefs. A dynamically consistent quantum-like agent may violate dynamic recursive consistency, however. This feature suggests interesting applications in behavioral economics as we illustrate in an example of persuasion. (shrink)

How do people detect mental dysfunction? What is the influence of cultural models of dysfunction on this detection process? The detection process as such is not usually researched as it falls between the domains of cross-cultural psychiatry and anthropological ethno-psychiatry . I provide a general model for this “missing link” between behavior and cultural models, grounded in empirical evidence for intuitive psychology. Normal adult minds entertain specific intuitive expectations about mental function and behavior, and by implication they infer that specific (...) kinds of behavior are the result of underlying dysfunction. This suggests that there is a “catalogue” of possible behaviors that trigger that intuition, hence a limited catalogue of possible symptoms that feed into culturally specific folk-understandings of mental disorder. It also suggests that some mental dysfunctions, as they do not clearly violate principles of intuitive psychology, are “invisible” to folk-understandings. This perspective allows us to understand the cultural stability and spread of particular views of madness. It also suggests why certain types of mental disorder are invisible to folk-understandings. (shrink)

This paper presents a new decision theory for modelling choice under risk. The new theory is a two-parameter generalization of expected utility theory. The proposed theory assumes that a decision maker: behaves as if maximizing expected utility; but may experience disappointment when the utility of a lottery’s outcome falls short of the expected utility of the lottery; and may have a preference for gambling. The proposed theory can rationalize the fourfold pattern of risk attitudes; the (...) common ratio effect and the reverse thereof ; the Allais paradox in classical common consequence problems and the reverse Allais paradox—in common consequence problems with an even split of a probability mass; violations of the betweenness axiom; switching behavior in the Samuelson’s example; violations of ordinal, upper and lower cumulative independence ; and preference reversals between valuations and choice. In application to insurance, the theory can rationalize full insurance with an actuarially unfair premium and aversion to probabilistic insurance. In application to optimal portfolio investment, the theory can rationalize the equity premium puzzle. (shrink)

We develop a model of Disappointment in which disappointment and elation arise from comparing the outcome received, not with an expected value as in previous models, but rather with the other individual outcomes of the lottery. This approach may better reflect the way individuals are liable to experience disappointment. The model obtained accounts for classic behavioral deviations from the normative theory, offers a richer structure than previous disappointment models, and leads to a Rank-Dependent Utility formulation in a transparent way. (...) Thus, our disappointment model may provide a clear psychological rationale for the subjective transformation of probabilities. (shrink)

Yoo (Economic Letters 37:145–149, 1991) argues that the law of iterated expectations must be violated if the probability measure of a Choquet decision maker is non-additive. In this article, we prove the positive result that the law of iterated expectations is satisfied for Choquet decision makers whenever they update their non-additive beliefs in accordance with the Sarin and Wakker (Journal of Risk and Uncertainty 16:223–250, 1998) update rule. The formal key to this result is the act-dependence of the Sarin–Wakker update (...) rule, which does not hold for the update rules considered by Yoo (1991). (shrink)

Memory limitations and probabilistic expectations are two key factors that have been posited to play a role in the incremental processing of natural language. Relative clauses (RCs) have long served as a key proving ground for such theories of language processing. Across three self-paced reading experiments, we test the online comprehension of Hungarian subject- and object-extracted RCs (SRCs and ORCs, respectively). We capitalize on the syntactic properties of Hungarian that allow for a variety of word orders within RCs, which helps (...) us to delineate the processing costs associated with memory demand and violated expectations. Results showed a processing cost at the RC verb for structures that have longer verb-argument distances, despite those structures being more frequent in the corpus. These findings thus support theories that attribute processing difficulty to memory limitations, rather than theories that attribute difficulty to less expected structures. (shrink)

The people of Myanmar were struck by three major human rights disasters during the country's period of democratization from 2003 to 2012: the 2007 Saffron Revolution, the aftermath of Cyclone Nargis in 2008, and the 2012 Rakhine riots, which would evolve into the ongoing Rohingya crisis. These events saw Myanmar's government categorically labeled as an offender of human rights, and three powerful Southeast Asian member states-Indonesia, Thailand, and Malaysia-responded to the violations in very different ways. In each case, their responses (...) to the crises were explicitly shaped by norm conflict, which may be understood as a tension between international and domestic norms. Their reactions were compelled by a need to address conflicting domestic and international expectations for norm compliance regarding human rights protection and non-interference in internal affairs. In Norms in Conflict: Southeast Asia's Response to Human Rights Violations in Myanmar, Anchalee Rüland makes sense of state action that occurs when a governing body is faced with a circumstance that is at once in line with and contrary to its own governing policies. She defines five different types of response strategies to situations of norm conflict and examines the enabling factors that lead to each strategy. Domestic norms are known to evolve as a country's values change over time yet Rüland argues that the old and new norms may also coexist; knowledge of the underlying political context is crucial for those seeking a solid understanding of state behavior. Norms in Conflict challenges the conventional understanding of the logic of consequences in determining state behavior, advancing constructivist theory and establishing a provocative new conversation in international relations discourse. (shrink)

Ellsberg (The Quarterly Journal of Economics 75, 643–669 (1961); Risk, Ambiguity and Decision, Garland Publishing (2001)) argued that uncertainty is not reducible to risk. At the center of Ellsberg’s argument lies a thought experiment that has come to be known as the three-color example. It has been observed that a significant number of sophisticated decision makers violate the requirements of subjective expected utility theory when they are confronted with Ellsberg’s three-color example. More generally, such decision makers are in conflict (...) with either the ordering assumption or the independence assumption of subjective expected utility theory. While a clear majority of the theoretical responses to these violations have advocated maintaining ordering while relaxing independence, a persistent minority has advocated abandoning the ordering assumption. The purpose of this paper is to consider a similar dilemma that exists within the context of multiattribute models, where it arises by considering indeterminacy in the weighting of attributes rather than indeterminacy in the determination of probabilities as in Ellsberg’s example. (shrink)

Suppose that you prefer A to B, B to C, and C to A. Your preferences violate Expected Utility Theory by being cyclic. Money-pump arguments offer a way to show that such violations are irrational. Suppose that you start with A. Then you should be willing to trade A for C and then C for B. But then, once you have B, you are offered a trade back to A for a small cost. Since you prefer A to B, (...) you pay the small sum to trade from B to A. But now you have been turned into a money pump. You are back to the alternative you started with but with less money. This Element shows how each of the axioms of Expected Utility Theory can be defended by money-pump arguments of this kind. The Element also defends money-pump arguments from the standard objections to this kind of approach. This title is also available as Open Access on Cambridge Core. (shrink)

For aggregative theories of moral value, it is a challenge to rank worlds that each contain infinitely many valuable events. And, although there are several existing proposals for doing so, few provide a cardinal measure of each world's value. This raises the even greater challenge of ranking lotteries over such worlds—without a cardinal value for each world, we cannot apply expected value theory. How then can we compare such lotteries? To date, we have just one method for doing so (...) (proposed separately by Arntzenius, Bostrom, and Meacham), which is to compare the prospects for value at each individual location, and to then represent and compare lotteries by their expected values at each of those locations. But, as I show here, this approach violates several key principles of decision theory and generates some implausible verdicts. I propose an alternative—one which delivers plausible rankings of lotteries, which is implied by a plausible collection of axioms, and which can be applied alongside almost any ranking of infinite worlds. (shrink)

On average, “young” people underestimate whereas “old” people overestimate their chances to survive into the future. Such subjective survival beliefs violate the rational expectations paradigm and are also not in line with models of rational Bayesian learning. In order to explain these empirical patterns in a parsimonious manner, we assume that self-reported beliefs express likelihood insensitivity and can, therefore, be modeled as non-additive beliefs. In a next step we introduce a closed form model of Bayesian learning for non-additive beliefs which (...) combines rational learning with psychological attitudes in the interpretation of information. Our model gives a remarkable fit to average subjective survival beliefs reported in the Health and Retirement Study. (shrink)

The classic formulation of causal decision theory (CDT) appeals to counterfactuals. It says that you should aim to choose an option that would have a good outcome, were you to choose it. However, this version of CDT faces trouble if the laws of nature are deterministic. After all, the standard theory of counterfactuals says that, if the laws are deterministic, then if anything—including the choice you make—were different in the present, either the laws would be violated or the (...) distant past would be changed. And as several authors have shown, it's easy to transform this upshot of the standard theory of counterfactuals into full-blown counterexamples to CDT. In response to these counterexamples, I argue here that the problem lies, not so much with CDT's guiding idea—that it's the expected causal consequences of your actions that matter for rational decision-making—but with the fact that the classic formulation of CDT doesn't pay sufficient attention to the context-sensitivity of counterfactuals. I develop a contextualist version of CDT which better accounts for this context-sensitivity. And I show that my theory avoids the problems faced by the classic formulation of CDT in determinstic worlds. (shrink)

Contextualists and Subject Sensitive Invariantists often cite the knowledge norm of assertion as part of their argument. They claim that the knowledge norms in conjunction with our intuitions about when a subject is properly asserting in low or high stakes contexts provides strong evidence that what counts as knowledge depends on practical factors. In this paper, I present new data to suggest they are mistaken in the way they think about cases involving high and low stakes and I show how (...) insensitive invariantists can explain the data. I exploit recent work done on the distinction between flouting a norm and being blamed for that violation to formulate a rigorous theory of rational expected blameworthiness that allows insensitive invariantists to explain the data cited. (shrink)

Collective action problems lie behind many core issues in ethics and social philosophy—for example, whether an individual is required to vote, whether it is wrong to consume products that are produced in morally objectionable ways, and many others. In these cases, it matters greatly what we together do, but yet a single individual’s ‘non-cooperative’ choice seems to make no difference to the outcome and also seems to involve no violation of anyone’s rights. Here it is argued that—contrary to influential (...) arguments by Peter Singer, Alastair Norcross, Shelly Kagan, Derek Parfit, and Allan Gibbard—an appeal to the expected consequences of acts cannot deliver plausible verdicts on many of these cases, because individuals often have a probability of making a difference that is sufficiently small to ensure that ‘non-cooperation’ is the option with the greatest expected value, even when consequentialists themselves agree that ‘cooperation’ is required. In addition, an influential argument by Singer, Norcross, and Kagan is shown to be unsound for the claim that in the collective action situations at issue, the expected effect of one individual’s action equals the average effect of everyone’s similar actions. These results have general implications for normative theory, because they undermine the sort of consequentialist explanation of collective action cases that is initially attractive from many theoretical points of view, consequentialist and otherwise. (shrink)

Risk-weighted expected utility theory permits preferences which violate the Sure-Thing Principle. But preferences that violate the STP can lead to bad decisions in sequential choice problems. In particular, they can lead decision-makers to adopt a strategy that is dominated – i.e. a strategy such that some available alternative leads to a better outcome in every possible state of the world.

It is often assumed that corporate social responsibility is a very promising way for corporations to improve their reputations, and a positive link between practicing CSR and corporate reputation is supported by empirical evidence. However, little is known about the mechanisms that underlie this relationship. In addition, the effects of not practicing CSR on corporate reputation have received little attention thus far. This paper contributes to the literature by analyzing the cause-and-effect relationships between practicing CSR and corporate reputation. To this (...) end, the paper draws on a psychological framework, in particular, on insights from expectancy violations theory and attribution theory. Building on the ideal-type distinction between CSR in terms of voluntary engagement for society and the prevention of irresponsible behavior, the paper develops four propositions that unveil some fundamental cause-and-effect relationships between practicing CSR, irresponsible behavior, and corporate reputation. In doing so, it also addresses the question under which conditions CSR leads to a buffering or backfiring effect on corporate reputation in the event of irresponsible behavior. (shrink)

No existing normative decision theory adequately handles risk. Expected Utility Theory is overly restrictive in prohibiting a range of reasonable preferences. And theories designed to accommodate such preferences (for example, Buchak's (2013) Risk‐Weighted Expected Utility Theory) violate the Betweenness axiom, which requires that you are indifferent to randomizing over two options between which you are already indifferent. Betweenness has been overlooked by philosophers, and we argue that it is a compelling normative constraint. Furthermore, neither Expected nor Risk‐Weighted (...) Expected Utility Theory allow for stakes‐sensitive risk‐attitudes—they require that risk matters in the same way whether you are gambling for loose change or millions of dollars. We provide a novel normative interpretation of Weighted‐Linear Utility Theory that solves all of these problems. (shrink)

When you are indifferent between two options, it’s rationally permissible to take either. One way to decide between two such options is to flip a fair coin, taking one option if it lands heads and the other if it lands tails. Is it rationally permissible to employ such a tie-breaking procedure? Intuitively, yes. However, if you are genuinely risk-averse—in particular, if you adhere to risk-weighted expected utility theory (Buchak in Risk and rationality, Oxford University Press, 2013) and have a (...) strictly convex risk-function—the answer will often be no: the REU of deciding by coin-flip will be lower than the REU of choosing one of the options outright (so long as at least one of the options is a nondegenerate gamble). This turns out to be a significant worry for risk-weighted expected utility theory. I argue that it adds real bite to established worries about diachronic consistency afflicting views, like risk-weighted expected utility theory, that violate Independence. And that, while these worries might be surmountable, surmounting them comes at a price. (shrink)

Prospect theory is increasingly used to explain deviations from the traditional paradigm of rational agents. Empirical support for prospect theory comes mainly from laboratory experiments using student samples. It is obviously important to know whether and to what extent this support generalizes to more naturally occurring circumstances. This article explores this question and measures prospect theory for a sample of private bankers and fund managers. We obtained clear support for prospect theory. Our financial professionals behaved according (...) to prospect theory and violated expected utility maximization. They were risk averse for gains and risk seeking for losses and their utility was concave for gains and convex for losses. They were also averse to losses, but less so than commonly observed in laboratory studies and assumed in behavioral finance. A substantial minority focused on gains and largely ignored losses, behavior reminiscent of what caused the current financial crisis. (shrink)

The four experiments presented support Boyer's theory that counterintuitive concepts have transmission advantages that account for the commonness and ease of communicating many non-natural cultural concepts. In Experiment 1, 48 American college students recalled expectation-violating items from culturally unfamiliar folk stories better than more mundane items in the stories. In Experiment 2, 52 American college students in a modified serial reproduction task transmitted expectation-violating items in a written narrative more successfully than bizarre or common items. In Experiments 3 and (...) 4, these findings were replicated with orally presented and transmitted stimuli, and found to persist even after three months. To sum, concepts with single expectation-violating features were more successfully transmitted than concepts that were entirely congruent with category-level expectations, even if they were highly unusual or bizarre. This transmission advantage for counterintuitive concepts may explain, in part, why such concepts are so prevalent across cultures and so readily spread. (shrink)

Cumulative Prospect Theory is the modern version of Prospect Theory and it is nowadays considered a valid alternative to the classical Expected Utility Theory. Cumulative Prospect theory implies Gain-Loss Separability, i.e., the separate evaluation of losses and gains within a mixed gamble. Recently, some authors have questioned this assumption of the theory, proposing new paradoxes where the Gain-Loss Separability is violated. We present a generalization of Cumulative Prospect Theory which does not imply Gain-Loss Separability (...) and is able to explain the cited paradoxes. On the other hand, the new model, which we call the bipolar Cumulative Prospect Theory, genuinely generalizes the original Prospect Theory of Kahneman and Tversky, preserving the main features of the theory. We present also a characterization of the bipolar Choquet Integral with respect to a bi-capacity in a discrete setting. (shrink)

Dual-ranking act-consequentialism (DRAC) is a rather peculiar version of act-consequentialism. Unlike more traditional forms of act-consequentialism, DRAC doesn’t take the deontic status of an action to be a function of some evaluative ranking of outcomes. Rather, it takes the deontic status of an action to be a function of some non-evaluative ranking that is in turn a function of two auxiliary rankings that are evaluative. I argue that DRAC is promising in that it can accommodate certain features of commonsense morality (...) that no single-ranking version of act-consequentialism can: supererogation, agent-centered options, and the self-other asymmetry. I also defend DRAC against three objections: (1) that its dual-ranking structure is ad hoc, (2) that it denies (putatively implausibly) that it is always permissible to make self-sacrifices that don’t make things worse for others, and (3) that it violates certain axioms of expected utility theory, viz., transitivity and independence. (shrink)

I argue that fitting resentment tracks unacceptable ‘ecological’ imbalances in relative social strength between victims and perpetrators that arise from violations of legitimate moral expectations. It does not respond purely, or even primarily, to offenders’ attitudes, and its proper targets need not be fully developed moral agents. It characteristically involves a wish for the restoration of social equilibrium rather than a demand for moral recognition or good will. To illuminate these contentions, I focus on cases that I believe demonstrate a (...) corollary thesis, namely, that strength, broadly construed, is a necessary condition of resentment-worthiness. I argue that weakness can make resentment unfitting in two ways. First, weakness may prevent a wrongdoer from shifting the balance of social power. Second, a weak wrongdoer may do social damage but be so lowly that resentment, which would represent him as excessively strong, would be inapt. Finally, I consider how accepting the ecological view might affect our theorizing about moral responsibility and the ethics of blame. (shrink)

From the viewpoint of the independence axiom of expected utility theory, an interesting empirical dynamic choice problem involves the presence of a “global risk,” that is, a chance of losing everything whichever safe or risky option is chosen. In this experimental study, participants have to allocate real money between a safe and a risky project. Treatment variable is the particular decision stage at which a global risk is resolved: (i) before the investment decision; (ii) after the investment decision, but (...) before the resolution of the decision risk; (iii) after the resolution of the decision risk. The baseline treatment is without global risk. Our goal is to investigate the isolation effect and the principle of timing independence under the different timing options of the global risk. In addition, we examine the role played by anticipated and experienced emotions in the choice problem. Main findings are a violation of the isolation effect, and support for the principle of timing independence. Although behavior across the different global risk cases shows similarities, we observe clear differences in people’s affective responses. This may be responsible for the conflicting results observed in earlier experiments. Dependent on the timing of the global risk different combinations of anticipated and experienced emotions influence decision making. (shrink)

Bell inequalities, understood as constraints between classical conditional probabilities, can be derived from a set of assumptions representing a common causal explanation of classical correlations. A similar derivation, however, is not known for Bell inequalities in algebraic quantum field theories establishing constraints for the expectation of specific linear combinations of projections in a quantum state. In the paper we address the question as to whether a ‘common causal justification’ of these non-classical Bell inequalities is possible. We will show that although (...) the classical notion of common causal explanation can readily be generalized for the non-classical case, the Bell inequalities used in quantum theories cannot be derived from these non-classical common causes. Just the opposite is true: for a set of correlations there can be given a non-classical common causal explanation even if they violate the Bell inequalities. This shows that the range of common causal explanations in the non-classical case is wider than that restricted by the Bell inequalities. (shrink)

People with the kind of preferences that give rise to the St. Petersburg paradox are problematic---but not because there is anything wrong with infinite utilities. Rather, such people cannot assign the St. Petersburg gamble any value that any kind of outcome could possibly have. Their preferences also violate an infinitary generalization of Savage's Sure Thing Principle, which we call the *Countable Sure Thing Principle*, as well as an infinitary generalization of von Neumann and Morgenstern's Independence axiom, which we call *Countable (...) Independence*. In violating these principles, they display foibles like those of people who deviate from standard expected utility theory in more mundane cases: they choose dominated strategies, pay to avoid information, and reject expert advice. We precisely characterize the preference relations that satisfy Countable Independence in several equivalent ways: a structural constraint on preferences, a representation theorem, and the principle we began with, that every prospect has a value that some outcome could have. (shrink)

Interactionism holds that explanatory and interpretive projects are mutually enriching. If so, then the evolutionary and cognitive science of religions’ explanatory theories should aid interpretive projects concerning religious meaning. Although interpretive accounts typically focus on the local and the particular, interpreters over the past century have construed Freud and Marx as offering general interpretive theories. So, precedent for general interpretive theorizing exists. 4E cognitive science, which champions how cognition is embedded in natural and cultural settings, extended into external structures, enacted (...) via motor routines, and embodied via representations rooted in human bodily form, has encouraged interpretive researchers. Theories of embodied cognition especially have embraced a sweeping view of meaning that attends to the emotions’ role and to their evolutionary origins. That inspires a 6E cognitive science that attends to the emotional and evolved dimensions of cognition too and opens up the possibility of general interpretive theories of broadly Darwinian character. Evolved cognitive systems qualify as maturationally natural cognition, which exhibits a distinctive constellation of features. The by-product theory holds that religious representations’ engagement of maturationally natural cognition fosters religions’ success. Representations with some minimal violation of intuitive expectations concerning some ontological category grab attention, stick in memory, and preserve the many automatic inferences accompanying the category. The empirical evidence for this and other elaborations of the by-product view suggests that it discloses dynamics of evolved cognition and associated emotions that tend to guide the pursuit of religious meanings systematically toward well-worn grooves in the semantic landscape. (shrink)

In his celebrated historic-epistemological work Identité et réalité, Émile Meyerson claimed that the scientific conservation principles were first suggested and accepted for philosophical reasons, and only afterwards were submitted to experimental tests. One of the instances he discussed in his book is the principle of mass conservation in chemical reactions. Meyerson pointed out that several authors, from Antiquity to Kant, accepted the idea of quantitative conservation of matter; and Lavoisier himself was strongly influenced by a priori ideas, using this principle (...) instead of attempting to test it. This paper will review Meyerson’s claim and historic evidence, focusing especially the late nineteenth and early twentieth century, when the principle of mass conservation was tested in highly accurate experiments. Instead of confirming the principle, some of those experiments led to the detection of anomalies. Hans Landolt, for instance, noticed that there were some small violations of the principle. He observed mass variations of about 10−6 in chemical reactions produced in hermetically sealed glass tubes. Since Landolt was a famous chemist, his results produced a strong response. Several researchers repeated his experiments, with different results. Landolt himself improved his experiments, with a balance that could detect mass changes of 10−7. After changes of the experimental procedure, the chemical reactions did not show significant mass changes. There was not, however, any “crucial experiment” “proving” that mass was conserved. The observed anomalies were set aside mainly by theoretical reasons, after the discovery of radioactivity and the development of the theory of relativity. (shrink)

This paper uses a two-dimensional version of a standard common consequence experiment to test the intransitivity explanation of Allais-paradox-type violations of expected utility theory. We compare the common consequence effect of two choice problems differing only with respect to whether alternatives are statistically correlated or independent. We framed the experiment so that intransitive preferences could explain violating behavior when alternatives are independent, but not when they are correlated. We found the same pattern of violation in the two cases. (...) This is evidence against intransitivity as an explanation of the Allais Paradox. The question whether violations of expected utility are mainly due to intransitivity or to violation of independence is important since it is exactly on this issue the main new decision theories differ. (shrink)

The topic of this thesis is how we should treat tiny probabilities of vast value. This thesis consists of six independent papers. Chapter 1 discusses the idea that utilities are bounded. It shows that bounded decision theories prescribe prospects that are better for no one and worse for some if combined with an additive axiology. Chapter 2, in turn, points out that standard axiomatizations of Expected Utility Theory violate dominance in cases that involve possible states of zero probability. Chapters (...) 3–6 discuss the idea that we should ignore tiny probabilities in practical decision-making. Chapter 3 argues that discounting small probabilities solves the ‘Intrapersonal Addition Paradox’ and thus helps avoid the Repugnant Conclusion. Chapter 4 explores what the most plausible version of this view might look like and what problems the different versions have. Chapter 5 focuses on one type of problem, namely, money pumps. The Independence Money Pump, in particular, presents a difficult challenge for those who wish to discount small probabilities. Finally, Chapter 6 discusses the implications of discounting small probabilities for the value of the far future. (shrink)

This paper presents an axiomatic framework for the priority heuristic, a model of bounded rationality in Selten’s (in: Gigerenzer and Selten (eds.) Bounded rationality: the adaptive toolbox, 2001) spirit of using empirical evidence on heuristics. The priority heuristic predicts actual human choices between risky gambles well. It implies violations of expected utility theory such as common consequence effects, common ratio effects, the fourfold pattern of risk taking and the reflection effect. We present an axiomatization of a parameterized version of (...) the heuristic which generalizes the heuristic in order to account for individual differences and inconsistencies. The axiomatization uses semiorders (Luce, Econometrica 24:178–191, 1956), which have an intransitive indifference part and a transitive strict preference component. The axiomatization suggests new testable predictions of the priority heuristic and makes it easier for theorists to study the relation between heuristics and other axiomatic theories such as cumulative prospect theory. (shrink)

This comment responds to Shapiro?s State of Democratic Theory. First, it argues that the map of democratic possibilities in the book, dividing forms of democracy into aggregative and deliberative, conflates and obscures important democratic alternatives. Second, I argue that one of the possibilities this map obscures, deliberation with aggregation, avoids the critique Shapiro directs at deliberative democracy. While some of his criticisms are appropriate to other categories, they do not apply to this one. Third, I argue that the empirical (...) work conducted under this category undermines Shapiro?s claims about how democracy can be expected to lead to violations of transitivity in actual practice. Fourth, I argue that there are other lines of defense for deliberative democracy in response to the combination of arguments that Shapiro offers in critique of deliberative democracy. (shrink)

I focus my discussion on the well-known Ellsberg paradox. I find good normative reasons for incorporating non-precise belief, as represented by sets of probabilities, in an Ellsberg decision model. This amounts to forgoing the completeness axiom of expected utility theory. Provided that probability sets are interpreted as genuinely indeterminate belief, such a model can moreover make the “Ellsberg choices” rationally permissible. Without some further element to the story, however, the model does not explain how an agent may come to (...) have unique preferences for each of the Ellsberg options. Levi holds that the extra element amounts to innocuous secondary “risk” or security considerations that are used to break ties when more than one option is rationally permissible. While I think a lexical choice rule of this kind is very plausible, I argue that it involves a greater break with xpected utility theory than mere violation of the ordering axiom. (shrink)

Considerations of dynamic inconsistency have figured prominently in debates over the rationality of preferences that violate the separability conditions characteristic of expected utility theory. These debates have mostly focused on risk- and ambiguity averse preferences, but analogous considerations apply to preferences for fairness. We revisit these debates in the context of a specific hypothesis regarding the violations of separability by such preferences, namely that they are potentially both explained and rationalised by attitudes to the chances of goods that motivate (...) a preference for equality in the distribution of chances across people and possible events. Our main aim is to argue that, first, when these violations of static separability are motivated by such attitudes to chances, then they need not result in dynamically inconsistent behaviour. Second, and more generally, considerations of dynamic consistency do not, we argue, undermine the rationality of such attitudes towards the distribution of chances, despite the fact that such attitudes give rise to violations of the static separability assumptions of expected utility theory. (shrink)

How should we choose on behalf of groups of agents who violate expected utility theory by being risk averse or risk seeking? Unfortunately, we sometimes have to choose either acts that everyone disprefers or acts that are sure to turn out worse than another act. This observation is particularly troubling for risk-expected utility theorists: neither option sits comfortably with their view.

It has been argued that infants possess a rich, sophisticated theory of mind that is only revealed with tasks based on spontaneous responses. A mature theory of mind implies the understanding that mental states are person-specific. Previous studies on infants’ understanding of motivational mental states such as goals and preferences have revealed that, by 9 months of age, infants do not generalize these motivational mental states across agents. However, it remains to be determined if infants also perceive epistemic (...) states as person-specific. Therefore, the goal of the present study was to use a switch agent paradigm with the classic false belief violation-of-expectation task. Results revealed that 16-month-old infants attributed true and false beliefs to a naïve agent—they did not perceive beliefs as person-specific. These findings indicate that infants’ understanding of beliefs is not as sophisticated as the rich mentalistic view suggests. (shrink)

Since the early Gestaltists there has been a strong interest in the question of how problem solvers get stuck in a mental impasse. A key idea is that the repeated activation of a successful strategy from the past results in a mental set (‘Einstellung’) which determines and constrains the option space to solve a problem. We propose that this phenomenon, which mostly was tested by fairly restricted experiments in the lab, could also be applied to more complex problem constellations and (...) naturalistic decision making. We aim at scrutinizing and reconstructing how a mental set determines the misinterpretation of facts in the field of political decision making and leads in consequence to wrong expectations and an ill-defined problem representation. We will exemplify this psychological mechanism considering a historical example, namely the unexpected stabilization of the Franco regime at the end of World War II and its survival thereafter. A specific focus will be drawn to the significant observation that erroneous expectations were taken as the basis for decisions. This is congruent with the notion that in case of discrepancy between preconceived notions and new information, the former prevails over the new findings. Based on these findings, we suggest a theoretical model for expectation violation in political decision making and develop novel approaches for cognitive empirical research on the mechanisms of expectation violation and its maintenance in political decision making processes. (shrink)

This paper tries to explain against the backdrop of the history of German criminal theory why and in which way the fault elements are seen differently in Germany and in Anglo-American countries. It shows how Feuerbach’s psychological model of guilt convinced Feuerbach’s German contemporaries in the 19th century that the suppression of the actual will to violate a criminal prohibition must be the reason for punishment. For such deterrence theory, direct intention is the central criterion of imputation. There (...) is no room for extensions like indirect intention. The resulting gap was filled by representatives of the will theory who created dolus eventualis as a criterion of imputation. The paper then concentrates on the gradual change which dolus eventualis has undergone due to the development of a ‘normative’ concept of guilt, i.e. a perception of guilt as a failure to live up to certain expected standards. It is outlined how the normative concept of guilt has facilitated Welzel’s decision to transplant dolus from the guilt level to the level of definitional elements. Transferring dolus to the definitional level led to a further change from a primarily voluntative to a cognitive content of the notion. It became appropriate to view dolus eventualis as acceptance of the prohibited state of affairs. For reasons of clarification the terms dolus eventualis and recklessness are compared in an annex to the paper. (shrink)

Suppose that a decision-maker's aim, under certainty, is to maximise some continuous value, such as lifetime income or continuous social welfare. Can such a decision-maker rationally satisfy what has been called "continuity for easy cases" while at the same time satisfying what seems to be a widespread intuition against the full-blown continuity axiom of expected utility theory? In this note I argue that the answer is "no": given transitivity and a weak trade-off principle, continuity for easy cases violates the (...) anti-continuity intuition. I end the note by exploring an even weaker continuity condition that is consistent with the aforementioned intuition. (shrink)