Behavioral economists have done a great service in connecting psychology and economics. Up to now, however, most have focused on cognitive illusions and anomalies, in order to prove the descriptive failure of neoclassical economic models. The key problems in the cognitive illusions literature...

Many models of (un)ethical decision making assume that people decide rationally and are in principle able to evaluate their decisions from a moral point of view. However, people might behave unethically without being aware of it. They are ethically blind. Adopting a sensemaking approach, we...

Doctors and patients have difficulty inferring the predictive value of a medical test from information about the prevalence of a disease and the sensitivity and false-positive rate of the test. Previous research has established that communicating such information in a format the human mind is...

The notion of ecological rationality implies that the accuracy of a decision strategy depends on features of the information environment in which it is tested. We demonstrate that the performance of a group may be strongly affected by the decision strategies used by its individual members and...

In a complex and uncertain world, humans draw inferences and make decisions under the constraints of limited knowledge, resources, and time. Herbert Simon, with his call for models of bounded rationality, can be seen as one of the fathers of the recently initiated research program on "simple...

In canonical decision problems with standard assumptions, we demonstrate that inversely related payoffs and probabilities can produce expected-payoff-maximizing decisions that are independent of payoff-relevant information. This phenomenon of rational ignoring, where expected-payoff maximizers...

One-reason decision making is a label for a class of fast and frugal heuristics that base decisions on only one reason. These heuristics do not attempt to optimally fit parameters to a given environment; rather, they have simple structural features and bet that the environment will fit them. By...