Thinking through uncertainty: nonconsequential reasoning and choice.

Abstract

When thinking under uncertainty, people often do not consider appropriately each of the relevant branches of a decision tree, as required by consequentialism. As a result they sometimes violate Savage's sure-thing principle. In the Prisoner's Dilemma game, for example, many subjects compete when they know that the opponent has competed and when they know that the opponent has cooperated, but cooperate when they do not know the opponent's response. Newcomb's Problem and Wason's selection task are also interpreted as manifestations of nonconsequential decision making and reasoning. The causes and implications of such behavior, and the notion of quasi-magical thinking, are discussed.