Causal Induction Enables Adaptive Decision Making

Abstract

The present paper examines the interplay between causal reasoning and decision making. We use a repeated decision making paradigm to investigate how people adapt their choice behavior when being confronted with changes in the decision environment. We argue that people are sensitive to the causal texture of a decision problem and adjust their choice behavior in accordance with their causal beliefs. In the first study we examine how people adapt their decision making behavior when new options whose consequences have not been observed yet become available. In the second study the causal system underlying the decision problem is modified to investigate how prior experiences with the choice task affect decision making. The results show that decision makers’ choice behavior is strongly contingent on their causal beliefs and that they exploit their causal knowledge to assess the consequences of changes in the decision problem situation. A high consistency between hypotheses about causal structure, expected values, and actual choices was observed.


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