The New Psychophysics of Risk and Time

Abstract

Descriptive models explain regularities in risk-taking and delay-discounting by applying stable subjective transformations to objective choice primitives. Noisy cognition models instead represent behavior as the outgrowth of optimal reactions to noisy perceptions and re-combinations of choice primitives. Here, we test the predictions of the two model classes by varying presentation formats of identical choice primitives in ways we expect to affect cognitive noise, but that should be immaterial under the lens of descriptive models. Our findings illustrate that behavioral regularities such as insensitivity to probabilities and to time delays can be systematically shifted and even reversed by subtle alterations in the presentation of identical choice tasks. The results show that noisy cognition models have generative and hence causal meaning, and highlight the limits of approaches that treat economic choices as detached from the brain’s information-processing constraints.