Forgetting the past: individual differences in recency in subjective valuations from experience

Area of Science:

• Cognitive Psychology
• Neuroeconomics
• Decision Science

Background:

• Decisions from experience often rely on past outcomes to estimate probabilities.
• Research suggests recent information may disproportionately influence decision-making.

Purpose of the Study:

• To investigate how the differential weighting of sequential information affects subjective valuations of risky prospects.
• To examine the role of individual cognitive capacities, particularly memory span, in information usage during valuation.

Main Methods:

• Two studies were conducted using decision-making tasks where participants estimated payoff distributions from observed outcomes.
• Computational models, including a sliding window model and an all-information integration model, were fitted to subjective valuation data.
• Individual differences in cognitive capacities, such as memory span, were assessed.

Main Results:

• A sliding window model, averaging only recent outcomes, provided a better fit for a subset of individuals' valuation data.
• The extent of information used in forming valuations varied significantly across participants.
• Individual differences in memory span were found to explain some of the variation in information usage.

Conclusions:

• Information aggregation in experiential decisions appears to be memory-based rather than a continuous online process.
• Cognitive capacity, specifically memory span, influences how individuals utilize past information when constructing subjective valuations.
• Findings offer new insights into the cognitive mechanisms underlying valuation in decisions from experience.