Numerate decision makers donʿt use more effortful strategies unless it pays: A process tracing investigation of skilled and adaptive strategy selection in risky decision making
The present
study investigated skilled and adaptive strategy selection in risky decision
making. We proposed that people with high objective numeracy, a strong
predictor of general decision making skill, would have a broad repertoire of
choice strategies and adaptively select these strategies depending on the
importance of the decision. Thus more objectively numerate people would
maximize their effort (e.g., invest more time) in important, high-payoff
decisions and switch to a simple, fast heuristic strategy in trivial decisions.
Subjective numeracy would, by contrast, be more closely related to interest in
problem solving for its own sake and would not yield such an effect of
importance. Participants made twelve high-payoff choices and twelve low-payoff
choices in binary two-outcome gambles framed as gains. We measured objective
and subjective numeracy using standard measures. Results showed that people
with high subjective numeracy generally maximized the expected value (EV) in
all decisions. In contrast, participants with high objective numeracy maximized
EV only when choice problems were meaningful (i.e., they could result in high
payoffs). When choice problems were trivial (i.e., choosing the normatively
better option would not result in a large payoff), more objectively numerate
participants made choices consistent with faster, more frugal heuristic
strategies. % some revision
