Deciding to simulate: Cognitive mechanisms of predicting the decisions of others

Existing behavioral and neural evidence suggests that people rely on mental simulation when predicting others' decisions. If true, making predictions with a biased decision system should result in biased predictions. We tested this idea directly by biasing participants' risk valuation through adaptation to either high- or low-probability contexts and then asking them to predict the choices of three distinct agents (risk-average, risk-averse, risk-seeking). The adaptation manipulation biased participants' predictions for the risk-average and risk-averse agents, suggesting simulation with their own (biased) decision process when predicting these agents. In contrast, there was no adaptation effect for the risk-seeking agent. Similarly, participants' own risk tendencies correlated with predictions for the risk-average and risk-averse, but not the risk-seeking agent. Drift diffusion modeling analyses showed that this adaptation bias was the result of changes in participants' risk valuation parameter. Overall, these findings support simulation-based prediction while suggesting a modulating role of the other person's characteristics.