Rational Choice Theory, Decision-Making - Essay Example

PERSONAL CASE STUDY REFLECTION Name of student Name and Number of Course Name of Professor Date Introduction Decision-making is a cognitive process that is resulting from cognitive process due to the selection of a course within the many or few alternatives scenarios. The process of decision-making will always end with a final choice made. Taking a psychological approach, individuals make decisions based on a context of set needs, what they prefer, what they see, and what they like. In a cognitive context, decision-making process is seen as a continuous process, which involves the interaction of the environment. Finally, through a normative perspective, decision-making is a process filled with logistics of decisions made rationally as the individual interacts with the immediate environment in relation to available options. Decision-making is also a problem-solving tool that is highly utilized by many people in business and other organizations. In other words, we can define the process of decision making as a process involving rational or irrational process based on explicit assumptions (Batley & Daly, 2006). The rational choice theory argues that we must maximize the benefits and minimize on the costs during the process of decision-making. Analysis of a finite set of alternatives is an important aspect during the process of decision- making. Analysis Before I made my decision to purse a master’s degree, I must admit that it was a tough time that required radical thinking and critical decision-making. Usually, if humans are left to make their own decisions, they apply the rational choice theory. This theory argues that people will make decisions by checking the likelihoods of the potential income, which they will then multiply by two. For example, if there is a 50-50 chance winning between $100 and $50, you will realize that most people will certainly go for the first choice(Postmes, Spears, & Cihangir, 2001). This included one of the reasoning that helped me choose to embark on a master’s degree. However, we must realize that there are situations that usually influence this theory. This is according to Garbage Can Theory, which argues that cause, and effect is always unclear during the process of decision-making. One of the major challenges is the availability of bias. For example, my situation comprised of the bias between continuing with my education or finding a job in China. The challenge that existed was that my Visa was just about to expire and it would take so long to apply for another one. The process of decision-making is always challenged by information overload. This is the usually the gap that exists between the information we require and the tools that are required to compose the decision. Information gap comprises of 5 elements (Drake, 1993). For example with relation to my situation, I experienced information overload in relation to personal information. This included the personal experiences, qualifications, and my attitude towards the decision I was making. This is with accordance to bounded rational theory. I also had to check on the information characteristic such as the frequency upon which I have to request for another academic visa. The tasks and procedures involved in the process is another element with the information overload that is so important in the process of decision-making. The current global job environment is as tough as it can be. In today’s day and age especially after the economic crises of 2008, the fresh graduates are struggling to make their way into professional life. The tough economic situation has made it very important for fresh graduates to polish there transferable skills before entering into professional life. Evaluating ones learning and skills is a critical aspect to know where one stands before taking any initiatives to improve his/her skills. It is also the ability to know and check whether personal initiative and goals are being achieved. Evaluation provides room for correction and improvement as well. In my case I have taken some online tests which have helped me to understand my unique set of skills and areas which need immediate attention in order to be successful in my future career. Rational decision making encounters various limitations including the knowledge of the decision maker, capacity of the decision maker to judge a situation, and the capacity of the decision maker to act logically rationally (Blackhart & Kline, 2005). The psychology of the decision maker adversely affect their decisions hence always leading to embarrassment like withdrawal, procrastination, shifting responsibility, rationalization, projection, and anticipatory reject. I must be sincere and admit that I found myself procrastinating my decision because I was afraid of making a wrong decision due to lack of knowledge. It is therefore advisable to plan your decision. Most of us do not plan our decisions and we must agree that they usually do not end up well. If decisions are well planned, they will experience the benefit of having the chance to establish independent goals since it will be a conscious directed process of listing and selection of choices (Perneger & Agoritsas, 2011). Planning for a decision also provide a standard of measurement. Like in my case, I was able to measure whether pursing my master’s degree would be valuable in the end than looking for a job as per that time. I therefore utilized the eight stages of decision-making structure. I also realized that planning converts values to action. This is because I was able to think twice about my plan and decided on what will help me advance my plan better. Through planning, I also realized that I was able to commit my limited resources in an orderly way. This is mainly I terms of time and money. My decision was a personal decision that probably did not involve so many people. I therefore applied the perceptual process model to make my decision (Schacter, 2011). The following is the process I underwent to make my decision; Identifying the problem-I engaged in a series of identifying the problem which included a completion of my Visa in a foreign country Establishing the decision criteria-this involved the public and private domain of making the decision such as the legal issue concerned with the expiry of my Visa Allocating weight to the decision criteria-this involved looking for viable alternatives. For example, going back to China and apply for a new Visa, or look for a job in China, and apply and enroll for a Master’s degree in the foreign country. Develop and list alternatives- my alternatives included; going back to China and apply for a new Visa, or look for a job in China, and apply and enroll for a Master’s degree in the foreign country. Analyzing alternatives- a thorough check of my alternatives indicates that going back for a Master’s degree is the best option. This is because I will simply extend my academic visa an improve my career by seeking higher levels of education Choosing alternatives- I chose to do Master’s after logical considerations and weighing against the available alternatives Implement decision- I am now enrolled in the course and I must say that I am happy with the decision and I stand a better chances of good jobs after I complete my course Evaluation of my decision- when I evaluate my decision I can say it is the best decision I ever made. This is because in case of any employment I shall possess higher job group level hence higher earnings. In one way or the other, this model is similar to the preference treemodel developed by Amos Tversky and Shmuel Sattach. This model follows the procedure of choosing alternatives in a sequential order ranging from general to more specific (Daniel Kahneman, 2000). Reflection From February 2011, I started to study a Business course in one college in Sydney. And after two years later I have finished it and get my certificate 3, 4 and diploma degree in March 2013. Because my overseas student visa was due to the 14th of June so I went back to China for a two months holiday and considered what the next step I should do. During the holiday in China, I had done some research about employment situation for overseas students. The result showed that the overseas students with master degree are much more popular than the students with diploma or bachelor degree. In addition, the different wages between master and diploma graduates is quite big. This result influenced my perception of the relationship between education background and employment. Three weeks before my visa due date, I came back to Sydney. Moreover, after having a discussion with my education agent, I have made a decision of studying a master degree course in New Castle University. According to bounded rational theory, my decision is making under limited conditions. Firstly, time is a finite resource because there were 3 months left after graduated otherwise I need go back to China and follow the procedure to apply a new visa. Secondly, I could not be able to evaluate all information about employment situation in China and the result I got is not comprehensive and may be inaccurate. Thirdly, according to Australian education policy, based on my previous diploma degree, there are only a few Universities I can choose to study amaster’s course. These are all the conditions, which influence my decision. Because my personality identify as ESFJ, which this type of person’s primary mode of living is focused externally, where they deal with things according to how they feel about them. When I went back to China, I had a thought to get a job. After gathering and analyzing the data I got, I realized that people of master degree are more in line with the demands of the employment. The externally environment affects me more than the internal. That is reason I begin to think about continue my master education just to improve my personal value. One trait of my personality is my dominant function demands structure and organization. So this determine when I make a decision, I prefer to follow the structure. So in this case, when I consider whether I should study master or not, I followed the eight stages of decision-making structure. Firstly I have identified the problem is if I should study master or not. Then I established the decision criteria, which is the employment market demand of master graduates. I collected all the available information and analysis. After deciding to continue my master education, I consulted my agent and asked them to provide all the information about the university that I am able to apply. After all, I make a decision of studying my master in New Castle University. The psychology of the decision maker is an important part of decision-making process. Goffman expressed that the decision maker as enacting a role that may be in conflict with their actual self, causing internal conflict and ego defense activity. As an overseas student, I have been limited in some area, such as visa restrictions. In my case, the overseas student social identity requires me to apply for the COE before my visa due date. That means I need to make a decision and implement in a time-limited condition. That causes the conflict with my laid-back personality. Therefore, I procrastinated to make the decision until the last three weeks. Conclusion In conclusion, bounded to rational theory, my decision was made under limited conditions (Doya & Shadlen, 2012). If I were to make the same decision again, I would make it with bits of differences. First, I would not procrastinate my decision. I will then actively get involved in a planning process towards my decision. Finally, I would evaluate the consequences of my decision before implementing it. References Batley, R., & Daly, A. (2006). On the equivalence between elimination-by-aspects and generalised extreme value models of choice behaviour. Journal of Mathematical Psychology, 50 (5): 456–467. Blackhart, G. C., & Kline, J. P. (2005). Individual differences in anterior EEG asymmetry between high and low defensive individuals during a rumination/distraction task. Personality and Individual Differences, 39 (2): 427–437. Daniel Kahneman, A. T. (2000). Choice, Values, Frames. Cambridge: The Cambridge University Press. Doya, K., & Shadlen, M. N. (2012). Decision Making. Current Opinion in Neurobiology, 22 (6): 911–913. Drake, R. A. (1993). Processing persuasive arguments: 2. Discounting of truth and relevance as a function of agreement and manipulated activation asymmetry. Journal of Research in Personality, 27 (2): 184–196. Perneger, T. V., & Agoritsas, T. (2011). Doctors and Patients' Susceptibility to Framing Bias: A Randomized Trial. J Gen Intern Med, 26 (12): 1411–1417. Postmes, T., Spears, R., & Cihangir, S. (2001). Quality of decision making and group norms. Journal of Personality and Social Psychology, 80 (6): 918–930. Schacter, G. W. (2011). Psychology (2nd Edition). New York: Worth. Read More