Strategic information search in decisions from experience
Wed-B16-Talk VII-04
Presented by: Mikhail Spektor
Good decisions require information. When people face a novel situation in which they make a choice but know little about the options in advance, how do they search for information? We present an analysis of over 1,000,000 information-search decisions made by over 2,500 individuals in a decisions-from-experience setting. We found that individuals solve the problem in a smart way using a toolbox of at least three strategies. In some cases, they decide how much information they want to obtain in advance and stick to that decision, irrespective of the obtained feedback. In others, they leverage sophisticated knowledge about the structure of the environment to find previously unobserved outcomes. Only after having done so do they try to reduce statistical uncertainty as proposed by existing accounts of information search. Our results highlight the need for broader theories of information-search behavior in decisions under uncertainty capturing the diversity of people's strategic toolbox.
Keywords: Information search, risky choice, strategic behavior, ecological rationality