Decision Making

Itamar Simonson

Decision making refers to the act of evaluating (i.e., forming opinions of) several alternatives and choosing the one most likely to achieve one or more goals. Common examples include deciding for whom to vote, what to eat or buy, and which college to attend. Decision making plays a key role in many professions, such as public policy, medicine, and management. The related concept of judgment refers to the use of information, often from a variety of sources, to form an evaluation or expectation. One might imagine that people's judgment determines their choices, though it is not always the case. Theories of decision making were originally developed by philosophers, mathematicians, and economists, who focused on how people make choices to achieve often conflicting goals. Following the work of early theorists such as John von Neumann and Oskar Morgenstern and Leonard Savage, a theory called subjective expected utility theory has become utilities ...

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