EXPRESS: Online representations of non-canonical sentences are more than good-enough

Proponents of good-enough processing suggest that readers often (mis)interpret certain sentences using fast-and-frugal heuristics, such that for non-canonical sentences (e.g. The dog was bitten by the man) people confuse the thematic roles of the nouns. We tested this theory by examining the effect of sentence canonicality on the reading of a follow-up sentence. In a self-paced reading study 60 young and 60 older adults read an implausible sentence in either canonical (e.g. It was the peasant that executed the king) or non-canonical form (e.g. It was the king that was executed by the peasant), followed by a sentence that was implausible given a good-enough misinterpretation of the first sentence (e.g. Afterwards, the peasant rode back to the countryside), or a sentence that was implausible given a correct interpretation of the first sentence (e.g. Afterwards, the king rode back to his castle). We hypothesised that if non-canonical sentences are systematically misinterpreted then sentence canonicality would differentially affect the reading of the two different follow-up types. Our data suggested that participants derived the same interpretations for canonical and non-canonical sentences, with no modulating effect of age group. Our findings suggest that readers do not derive an incorrect interpretation of non-canonical sentences during initial parsing, consistent with theories of misinterpretation effects that instead attribute these effects to post-interpretative processes.

Heuristics in financial decision-making: the selection of SME financing by advisers in an increasingly diverse market

PurposeIn order to better understand how heuristics are used in practice, the authors explore what type of heuristics is used in the managerial domain of financial advisors to small and medium-sized enterprises (SMEs) and what influences the shaping of these heuristics. In doing so, the authors detect possible fast-and-frugal heuristics in day-to-day decision-making of independent financial advisers who help owners of SMEs to acquire capital (e.g. loans, factoring, leasing and equity).Design/methodology/approachThe authors inductively assessed the work of financial advisers of SMEs. Based on group discussions, the authors drew up a semi-structured interview-protocol with descriptive questions about how financial advisers come to a deal for their clients. The interviews of 19 professionals were analysed by relating them to the theory of fast-and-frugal heuristics.FindingsWithin their decision-making, advisers estimate the likelihood of acceptance by a few financial providers they know well in their personal network with a strong bias towards traditional banking products, although there are a large number of alternatives on the Dutch market. “Less is more” seems to be a relevant principle when defined as satisficing. Heuristics help advisers to deal with behavioural and economic limitations. Also, the authors have found that client interaction, previous working experience and the company the adviser is working for influences the shaping of the simple rules the adviser is using.Research limitations/implicationsThe study shows how difficult it is to understand the ecological rationality of a certain group of professionals and to understand the “less is more” principle. Financial advisers to SMEs use cognitive shortcuts and simple rules to advise SME-owners, based on previous experiences, but it is difficult to determine whether that leads to the same or even better solutions for them and their clients than using probability theory and financial optimisation models. Within heuristics, satisficing seems to be a dominant mechanism. Here, heuristics help advisers in recognising possibilities by searching for similarities between a current financing case and previous experiences. The data suggests that if “less is more” is defined as satisficing for one or more stakeholders involved, the principle dominates the decision making of financial advisers of SME's.Practical implicationsThe authors suggest the relevance of a behavioural approach to finance by assessing the day-to-day decisions of financial advisers of SMEs. Also, the authors suggest that financial advisers are guided by previous experiences, and they do not fully assess a wide range of options in their work but need shortcuts to fulfil the needs of their clients.Originality/valueThe study comes close to day-to-day decision-making in finance by assessing how professionals make decisions. The authors try to understand types of heuristics in relation with “ecological rationality” and the less is more principle. The authors assess financial advisers of SME-companies, a group that has gotten little research attention until now. The influence of client interaction and of the company the adviser is working for is remarkable in the shaping of the advisers' simple rules.

Fast and Frugal Heuristics

Polymath, and also political scientist, Herbert Simon dared to point out that the amounts of time, information, computation, and other resources required for maximizing utility far exceed what is possible when real people have to make real decisions in the real world. In psychology, there are two main approaches to studying actual human judgment and decision making—the heuristics-and-bias and the fast-and-frugal-heuristics research programs. A distinctive characteristic of the fast-and-frugal-heuristics program is that it specifies formal models of heuristics and attempts to determine when people use them and what performance they achieve. These models rely on a few pieces of information that are processed in computationally simple ways. The information and computation are within human reach, which means that people rely on information they have relatively easy access to and employ simple operations such as summing or comparing numbers. Research in the laboratory and in the wild has found that most people use fast and frugal heuristics most of the time if a decision must be made quickly, information is expensive financially or cognitively to gather, or a single/few attributes of the problem strongly point towards an option. The ways in which people switch between heuristics is studied in the framework of the adaptive toolbox. Work employing computer simulations and mathematical analyses has uncovered conditions under which fast and frugal heuristics achieve higher performance than benchmarks from statistics and machine learning, and vice versa. These conditions constitute the theory of ecological rationality. This theory suggests that fast and frugal heuristics perform better than complex optimization models if the available information is of low quality or scarce, or if there exist dominant options or attributes. The bias-variance decomposition of statistical prediction error, which is explained in layperson’s terms, underpins these claims. Research on fast and frugal heuristics suggests a governance approach not based on nudging, but on boosting citizen competence.

Bibliometrics-based decision trees (BBDTs) based on bibliometrics-based heuristics (BBHs): Visualized guidelines for the use of bibliometrics in research evaluation

Fast-and-frugal heuristics are simple strategies that base decisions on only a few predictor variables. In so doing, heuristics may not only reduce complexity but also boost the accuracy of decisions, their speed, and transparency. In this paper, bibliometrics-based decision trees (BBDTs) are introduced for research evaluation purposes. BBDTs visualize bibliometrics-based heuristics (BBHs), which are judgment strategies solely using publication and citation data. The BBDT exemplar presented in this paper can be used as guidance to find an answer on the question in which situations simple indicators such as mean citation rates are reasonable and in which situations more elaborated indicators (i.e., [sub-]field-normalized indicators) should be applied.