The Importance of Decision Making – How Biases Affect Our Brain

The Importance of Decision Making – How Biases Affect Our Brain

  One of the things we do most in daily life is to make decisions. Just imagine how much decisions we make in a day, and probably it’s the second thing that we do most frequently after breathing. Some of the decisions we make are very important and decisive for us, while others are less important. In other words, the returns of our decisions are quite different from each other and each of them has their own marginal utility function. So we need to be more attentive, rational and devoted in our decisions. At first we need to evaluate accurately, how important and what is the possible outcomes giving the right and the wrong decision. This topic was diffusively explained by Daniel Kahneman and Amos Tversky in “Prospect Theory: An Analysis of Decision under Risk” in 1979. In 2002 Daniel Kahneman shared the Nobel Prize in Economics with this theory but unfortunately Amos Tversky had died by that time. In 2011...
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