Thursday, April 23, 2009
Emotions in Decision Making
One of the most common theories in the field of decision making is the expected utility theory (EU). Expected utility theory models decision making as a consideration and weighing of the severity and likelihood of the possible outcomes of different alternatives. The integration of this information is made through some type of expectation, based calculus (cognitive activity) which enables us to make a decision. In this theory, psychological processes and the decision maker’s emotional state were ignored and not taken into account as inputs to the expectation based calculus.