Tuesday, 5 January 2016

Individual Differences in Cognitive Biases



This post is by Predrag Teovanović (pictured above), graduate student at the University of Belgrade. In this post he summarises his recent paper ‘Individual Differences in Cognitive Biases: Evidence Against One-Factor Theory of Rationality’, co-authored with Goran Knežević and Lazar Stankov, published in Intelligence.


If there is a minimal definition of rational behavior, it can be found here. From the normative standpoint, rational behaviour is hard (if not impossible) to maintain all the time. Hence, we satisfice by trying to optimize the boundaries of bounded rationality at the intersection of our own resources (time, information, money, and cognitive capacities) and environmental demands. Cognitive biases (CBs) emerge in that junction.  

Since what defines rational behaviour depends on both environment and organism, and since specific CBs arise in different environments - it is reasonable not to expect from CBs to be highly related to individual differences in organisms’ capacities and habits. In my article, I write-up the most forthright empirical demonstration of this expectation that I could obtain with the great assistance of my dear colleagues Goran Knežević and Lazar Stankov.
                                   
I took an approach initiated by Keith E. Stanovich and Richard F. West (1998, 2000) and pursued it in a more psychometrical way. First, I developed new measurement procedures for the assessment of individual differences in seven CBs (anchoring effect, belief bias, overconfidence bias, hindsight bias, base rate neglect, outcome bias, and sunk cost effect). These procedures were devised from conceptual definitions of aforementioned CB phenomena and/or seminal examples of CB tasks (which are their operationalisations). On average, dozens of items were used for each CB phenomenon.
Covariations between items within specific CB phenomena on a sample of 235 post-adolescents were high enough to produce satisfactory reliable measures of individual differences (Cronbach’s alphas were above .70). Thus, it was reasonable to conclude that measurement errors did not play a major role in this study.

The study was truly aimed to examine a latent structure of rationality-related phenomena in terms of a relatively comprehensive list of individual-differences constructs. Results were as follows: although individual CBs were really relatively independent from one another (correlations among them were below .25), they were loaded together on two latent factors that were clearly separated from the latent factor which was combination of Openness and Need for Cognition (and was labelled as thinking dispositions factor), and well-known psychometric factors of fluid intelligence (common variance in Raven, mental rotation and working memory) and crystalized intelligence (vocabulary and verbal analogies).

In short, evidence that a major part of the reliable variance of cognitive bias tasks was unique implies that a one-factor model of rational behaviour is not plausible, which further suggests that implying existence of strong unidimensional underlying construct of rational behaviour is not the right thing to do. And it was certainly not what Stanovich and West did.

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