ABSTRACT
In this chapter, the main literature on the psychology of judgement and decision making (JDM) will be examined for evidence of dual processing and the principles of hypothetical thinking. Despite the obvious connections with the psychology of reasoning in terms of higher mental processes, this endeavour is not as straightforward as might be expected. Unlike the psychology of reasoning, the study of decision making is interdisciplinary and not firmly situated within cognitive psychology. Much research on decision making is conducted by psychologists and those trained in other disciplines within business schools where links to economics and applications in public policy are considered more important than the investigation of cognitive processes. Psychological studies in this area have also traditionally been linked very closely with questions about normative theory and rationality. For example, the rational theory of choice – subjective expected utility (see Chapter 1) – has dominated much of the huge literature on this topic, albeit as an ideal from which departures are regularly demonstrated (for recent reviews, see Hastie, 2001; Koehler & Harvey, 2004; LeBeouf & Shafir, 2005). The rational model involves the notions of consequentialism and optimization. That is to say, people should analyse a decision problem by calculating the consequences of alternative actions. They should also attempt to optimize choice by maximizing expected utility across all available choices, analysed to whatever depth is feasible (see Chapter 1).
