Understanding the cognitive miser: Cue-utilization in effort-based decision making

SUMMARY Materiality remains a challenging concept for auditors to implement in practice. The challenges underlying auditor materiality assessments are compounded by the fact that courts, regulation, and professional standards emphasize that materiality should be based on a “reasonable investor” perspective. Despite the investor orientation and ambiguous nature of the “reasonable investor” criterion, the extant literature lacks empirical evidence about investor materiality judgments and decision-making. To address this problem, we model sophisticated and unsophisticated investors' materiality judgments in a policy-capturing study and compare them to experienced auditors charged with assessing materiality from an investor perspective. The results indicate significant differences in materiality judgments, judgment consensus, and cue utilization among the three participant groups. We conclude the paper with discussion of the study's implications, highlighting that the overall results suggest the need for further consideration of ways to help auditors meet standards and expectations in this critical domain.

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The relationship between pre-flight decision-making and cue utilization

PsycEXTRA Dataset ◽

10.1037/e572172013-499 ◽

2012 ◽

Author(s):

Mark W. Wiggins ◽

Danielle Azar ◽

Thomas Loveday

Keyword(s):

Decision Making ◽

Cue Utilization ◽

The Relationship

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Failed Frequent Flyers

The Cognitive Autopsy ◽

10.1093/med/9780190088743.003.0017 ◽

2020 ◽

pp. 111-118

Author(s):

Pat Croskerry

Keyword(s):

Decision Making ◽

Emergency Department ◽

Sufficient Information ◽

Principal Characteristic ◽

Cognitive Pattern ◽

Cognitive Miser

Two cases are reviewed in Case 16; both demonstrate problems with “frequent flyers” in the emergency department (ED). The principal characteristic of these patients is that despite their symptoms and complaints being minor, they frequently present to the ED. Inevitably, ED staff tend to view their visits disparagingly. However, like the boy who cried wolf, they will occasionally have serious underlying conditions that need to be addressed. A prominent cognitive pattern is described: the cognitive miser function. It is the tendency to uncritically accept things at face value. Although this may be adequate for many routine decisions, the failure to unpack sufficient information will sometimes result in suboptimal decision making.

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The Relationship Between Pre-Flight Decision-Making and Cue Utilization

Proceedings of the Human Factors and Ergonomics Society Annual Meeting ◽

10.1177/1071181312561492 ◽

2012 ◽

Vol 56 (1) ◽

pp. 2417-2421 ◽

Cited By ~ 4

Author(s):

Mark W. Wiggins ◽

Danielle Azar ◽

Thomas Loveday

Keyword(s):

Decision Making ◽

Cue Utilization ◽

The Relationship

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Cue Utilization as an Objective Metric in Naturalistic Decision-Making

Proceedings of the Human Factors and Ergonomics Society Annual Meeting ◽

10.1177/1071181320641051 ◽

2020 ◽

Vol 64 (1) ◽

pp. 209-213

Author(s):

Mark W. Wiggins

Keyword(s):

Decision Making ◽

New Technologies ◽

Naturalistic Decision Making ◽

Cue Utilization ◽

Training Outcomes ◽

Domain Specific ◽

Wide Range ◽

Robust Process ◽

Selection Of

The utilization of cues is a process that underpins a wide range of naturalistic models of decision-making, often differentiating the performance of experts and non-experts. However, the domain-specific and idiosyncratic nature of cue utilization means that the existence of cues in memory, together with their application, has been difficult to assess. This paper explains a valid and reliable approach to the assessment of cue utilization that accounts for idiosyncrasy and confirms the role of cues in facilitating performance amongst skilled practitioners. It also enables comparative analyses between operators, thereby facilitating a more robust process for the selection of subject-matter experts, assessments of gaps in performance that might be explained by differences in cue utilization, especially following the introduction of new technologies, the evaluation of training outcomes against baseline performance, and the identification of changes in cue utilization that might be associated with absences or other workplace demands.

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Discarding optimality: Throwing out the baby with the bathwater?

Behavioral and Brain Sciences ◽

10.1017/s0140525x18001401 ◽

2018 ◽

Vol 41 ◽

Cited By ~ 1

Author(s):

Patrick Simen ◽

Fuat Balcı

Keyword(s):

Decision Making ◽

Perceptual Decision Making ◽

Reward Rate ◽

Perceptual Decision ◽

Standard Observer ◽

Rate Maximization ◽

Reward Rate Maximization ◽

Descriptive Standard ◽

Observer Model

AbstractRahnev & Denison (R&D) argue against normative theories and in favor of a more descriptive “standard observer model” of perceptual decision making. We agree with the authors in many respects, but we argue that optimality (specifically, reward-rate maximization) has proved demonstrably useful as a hypothesis, contrary to the authors’ claims.

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LPCD framework: Analytical tool or psychological model?

Behavioral and Brain Sciences ◽

10.1017/s0140525x18001383 ◽

2018 ◽

Vol 41 ◽

Author(s):

David Danks

Keyword(s):

Decision Making ◽

Analytical Tool ◽

Mathematical Framework ◽

Bayesian Decision ◽

Perceptual Decision Making ◽

Psychological Model ◽

Psychological Reality ◽

Psychological Theories ◽

Target Article ◽

Bayesian Decision Making

AbstractThe target article uses a mathematical framework derived from Bayesian decision making to demonstrate suboptimal decision making but then attributes psychological reality to the framework components. Rahnev & Denison's (R&D) positive proposal thus risks ignoring plausible psychological theories that could implement complex perceptual decision making. We must be careful not to slide from success with an analytical tool to the reality of the tool components.

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Elaborating the role of reflection and individual differences in the study of folk-economic beliefs

Behavioral and Brain Sciences ◽

10.1017/s0140525x18000274 ◽

2018 ◽

Vol 41 ◽

Author(s):

Kevin Arceneaux

Keyword(s):

Decision Making ◽

Individual Differences ◽

Cognitive Processes ◽

Evolutionary History ◽

Behavioral Responses ◽

History Of ◽

Economic Beliefs

AbstractIntuitions guide decision-making, and looking to the evolutionary history of humans illuminates why some behavioral responses are more intuitive than others. Yet a place remains for cognitive processes to second-guess intuitive responses – that is, to be reflective – and individual differences abound in automatic, intuitive processing as well.

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