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Decision-making Made not Born

May 2007 A study by decision scientists at Carnegie Mellon University and the RAND Corporation published in the May issue of the Journal of Personality and Social Psychology has found that people who do well on a series of decision-making tasks involving hypothetical situations tend to have more positive decision outcomes in their lives. The researchers conclude that the quality of people's lives may be improved by teaching them better decision-making skills.

The study is important because it shows a relationship between tasks developed to study decision-making errors in psychology labs and decision-making ability in real life. It also shows that while competence in decision-making is correlated with both verbal and nonverbal intelligence, it remains a separate skill.

The study involves 360 people from diverse backgrounds. Each person completed seven tasks designed to measure 'Adult Decision-Making Competence' - the ability to avoid common decision-making errors. Good decision-makers should be able to make choices independently of the way in which information is presented, or framed. For example, medication that is 99 percent effective should be judged in the same way if it is described as 1 percent ineffective.

Participants in the study also completed a survey about controllable life experiences that might indicate poor decision-making. Amongst other questions, participants were asked if they:

  • had ever spent a night in jail
  • been unfaithful to a romantic partner
  • bounced a check
  • been arrested for driving under the influence
  • had a romantic relationship that lasted for more than a year
  • been diagnosed with Type 2 diabetes

The researchers found that participants who reported the most negative controllable life experiences also fared worst on the decision-making tasks.

"Intelligence doesn't explain everything. Our results suggest that people with good decision-making skills obtain better real-life outcomes, even after controlling for cognitive ability, socio-economic status and other factors," said Wändi Bruine de Bruin, lead author from the Department of Social and Decision Sciences at Carnegie Mellon. "That is good news, because decision-making skills may be taught."

de Bruin's co-authors were Andrew Parker, an associate behavioral scientist with the RAND Corp., and Baruch Fischhoff, the Howard Heinz University Professor of Social and Decision Sciences and Engineering and Public Policy at Carnegie Mellon.

The researchers point out that the study does not provide definite proof that good decision-making skills lead to better life outcomes - they did not examine the direction of causality. It may be that the stress of difficult life experiences erodes decision-making skills. Further research is required to determine whether people's life experiences improve after receiving decision-making training.

You can take a short version (15 minutes) of the test and find out how you compare at sds.hss.cmu.edu/risk/decision.html.

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