Description of How Humans Make Both Logical and Risky Decisions - Essay Example

of How Humans Make both Logical and Risky Decisions Unlike animals which make decisions or take actions mostly based on their instincts,human beings are engaged in decision making at different levels every day. Some of the decisions are subconscious, and our bodies compel us to act in a certain way depending of a variety of biological circumstances. Incidentally, these are not that different from the animals’ primordial instincts, however, the kinds of decisions that set the human race apart from any other creatures are the conscious decisions; these are decisions that we deliberate on, weigh the options and pick what appears to be the best alternative under the circumstances. Comprehending the process through which people arrive at their decisions is a broadly studied area of cognitive psychology. Each decision one makes is based on several factors that include but are not limited to experience, cognitive bias and emotional and physiological wellbeing. Age, gender as well as a myriad of individual differences, are also important factors in the process (Dietrich, 2010). A crucial aspect of decision-making is the application of heuristics; commonly described as decision-making strategies employed in situations when one has little information or when they need to reduce the burden of decision-making. While they may appear capricious and heuristics serve as mental shortcuts and are often correct since they are based on personal experience and hindsight (Dietrich, 2010). For instance, when shopping, one may apply price heuristics, which they use to determine the quality of a product by holding it in direct proportion with the price. This way they will assume that the more pricy the commodity, the more valuable it is, and they save a lot of time that would have been spent trying to authenticate the quality of the good by minute examinations consultations or even a myriad of considerations. While they are not full proof, they serve most people in their decision making process on a wide scope of issues. When it comes to making conscious decisions, one can make them based solid reasoning and rationalizing after considering all the pertinent factors, before arriving at what they believed to be the most appropriate decision, this is known as logical decision making. Then there is risky decision making, herein, one decides on something without taking the time to consider all the factors often attracted to this by the fact that the benefits are usually enormous. However, the risks are equally great, but people often are blinded to this by the perceived benefits. Decision-making has been studies extensively by many scientist and behaviorists, and they have come up with various models, that they consider representative of the human decision making process. For instance, when it comes to making logical and rational decisions the following model was put forward. While it is not universal, it provides a good overview of how the mind is able to reach a logical conclusion (The Happy Manager, n.d.). The first step is identifying a problem or situation, once this has been done an individual then gathers as much information as possible about the same. Taking into account the information they are able to identify the available options and will hence consider them and their ultimate outcomes. It is here that one is able to conceptualize contingencies and plan Bs, and then they evaluate the options and try to decide which is most suitable for the prevailing situation. They then select the appropriate alternatives and as soon as they have ascertained it is the best option the way implement it (The Happy Manager, n.d.). This decision-making often takes time and a lot of thought and is often the work of the higher levels of the mind mostly the ego and ego ideal. Methods to Decrease Risky Decision Making in Favor of Logical Decision Making A risky decision is more of a gamble; ideally, two individuals may be faced with the same two options, one with a propensity for risky and hasty decision-making, and the other ascribes to the aforementioned logical description. The risky decision maker will not stop to consider all the option, but will only focus on the perceived gain and take a risk. People act differently, but not so much because of how risky a situation is but how it is presented, when presented with a risk in terms of losses, they become more inclined to taking the risk than if it was presented in terms of gains (Kahneman, Slovic and Tversky, 1990). This is the same even when an identical situation is framed twice to look different. However, a logical decision maker, after incisive examination would realize the situations is not that different and may opt out altogether or make a more informed decision. Risky decision as the name suggests can be extremely risky and result in considerable losses in property, status or even life. As such, it is imperative that individuals with a predisposition for such decision making learn to adopt a more reasonable and thoughtful model of thinking. This can be achieved in a number of ways; one is to consider the consequences of past, risky decision making before they make a choice. An individual with a past of risky and hasty decision will most probably have a history of regretful and unsuccessful decisions; therefore, an examination of the retrospective outcomes may assist one refrain from rash decisions. A second option could involve taking the time to think before making a decision and especially avoid putting one’s self under pressure, this could be achieved if one allowed themselves enough time to consider the decision since logical though often takes time while risky decision rarely does. They could make it a habit to write a list of pros and cons before finalizing on any decision, this way they would get a chance to see on paper and hence more objectively the impact of their actions or non-actions (Goldstein, 2004). One of the reasons people are unable to think logically is known as confirmation bias, this is when one selectively considers information and tries to make it match with their pre-formed hypothesis (Goldstein, 2004). Finally, it is notable that pleasure drives most risky decision makers and pain avoidance instincts also known as the Id. Admittedly, logical thought requires considerable effort and it might be nerve wracking and frustrating at times. On a subconscious level, many risk takers do so because they want to avoid the “painful” process of decision-making. Considering Freud’s analogy, this is like a rider and a horse; the horse will take the easiest path; the path of least resistance, and hence it is incumbent of the rider to direct it toward he proper path which might not be one the horse prefers. In the risk takes case, the path of least resistance is that of deciding capriciously without stopping to factor in all the possible outcomes or choosing to ignore the negative ones (Knaus, 2010). Ultimately, such individuals need to learn how to discipline themselves and not simply give in to their immediate desire. References Tversky, A., Slovic, P. and Kahneman, D. (1990). The Causes of Preference Reversal. The American Economic Review, Volume 80, Issue. 201-217. Knaus, B. (2010). Emotions, Decision Making, and Procrastination. Psychology Today Magazine. Retrieved from http://www.psychologytoday.com/blog/science-and-sensibility/201003/emotions-decision-making-and-procrastination Dietrich, C. (2010). Decision Making: Factors that Influence Decision Making, Heuristics Used, and Decision Outcomes. Student Pulse. Vol. 2 No. 02 . pp.1-3 The Happy Manager. (n.d.). Rational Decision Making Model.Retrieved from http://www.the-happy-manager.com/rational-decision-making-model.html Goldstein, E., B. (2004). Cognitive psychology: connecting mind, research and everyday experience. London: Cengage Learning. Read More