A large portion of decision analysis lies in a decision maker’s uncertainty about an outcome and what they perceive is the chance (probability) of that outcome occurring (in other words, an individual’s “degree of belief” that an outcome will occur). However, thinking probabilistically can be difficult and we rely on “rather primitive cognitive techniques to make” such assessments (these techniques are termed heuristics) (Clemen & Reilly, 2001 p.311). Heuristics are simple and intuitive but tend to result in probabilities that are biased. This thesis will connect the literature available from both the psychology behind the biases and the mathematical problems associated with the probability elicitation itself. Additionally, this thesis will present a better understanding of the biases that distort the probability elicitation for the decision maker along with suggestions for improving such assessments.
| Identifer | oai:union.ndltd.org:vcu.edu/oai:scholarscompass.vcu.edu:etd-2795 |
| Date | 30 April 2009 |
| Creators | Mihajlovits, Bethany |
| Publisher | VCU Scholars Compass |
| Source Sets | Virginia Commonwealth University |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | Theses and Dissertations |
| Rights | © The Author |
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