Policy Capturing with Ridge Regression

A policy capturing method combining human judgment with ridge regression is offered which results in superior judgment policy models. The new method (termed smart ridge regression) was tested against four others in seven judgment policy capturing applications. Performance criteria were two cross-validation indices: cross-validated multiple correlation and mean squared error of prediction of new judgments. Smart ridge regression was found to outperform ordinary least squares regression and conventional ridge regression, as well as subjective weighting and equal weighting of cues.