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Encyclopedia > Representativeness heuristic

The representativeness heuristic is a heuristic wherein we assume commonality between objects of similar appearance. While often very useful in everyday life, it can also result in neglect of relevant base rates and other errors. The representative heuristic was first identified by Amos Tversky and Daniel Kahneman. Heuristic is the art and science of discovery and invention. ... In philosophy, an object is a thing, an entity, or a being. ... Amos Tversky (March 16, 1937 - June 2, 1996) was a pioneer of cognitive science, a longtime collaborator of Daniel Kahneman, and a key figure in the discovery of systematic human cognitive bias and handling of risk. ... Daniel Kahneman Daniel Kahneman (born March 5, 1934 in Tel Aviv, in the then British Mandate of Palestine, now in Israel), is a key pioneer and theorist of behavioral finance, which integrates economics and cognitive science to explain seemingly irrational risk management behavior in human beings. ...


Two examples are commonly used when explaining this heuristic.

Contents


Tom W.

In a study done in 1973, Kahneman and Tversky gave their subjects the following information:


Tom W. is of high intelligence, although lacking in true creativity. He has a need for order and clarity, and for neat and tidy systems in which every detail finds its appropriate place. His writing is rather dull and mechanical, occasionally enlivened by somewhat corny puns and by flashes of imagination of the sci-fi type. He has a strong drive for competence. He seems to feel little sympathy for other people and does not enjoy interacting with others. Self-centered, he nonetheless has a deep moral sense.


One group of subjects was asked how similar Tom W. was to a student in one of nine types of college graduate majors (business administration, computer science, engineering, humanities/education, law, library science, medicine, physical/life sciences, or social science/social work). Most subjects associated Tom W. with an engineering student, and thought he was least like a student of social science/social work.


A second group of subjects was asked instead to estimate the probability that Tom W. was a grad student in each of the nine majors. The probabilities were in line with the judgments from the previous group.


A third group of subjects was asked to estimate the proportion of first-year grad students there were in each of the nine majors.


The second group's probabilities were based mainly on how much they thought Tom W. was representative of each of the majors, and completely neglected the base rate probability of being that kind of student in the first place (the third group). Had the subjects thought about those base rates, their estimated probability that Tom W. was an engineer would have been much lower, as there were few engineering grad students at the time.


The Taxicab problem

In another study done by Tversky and Kahnman, subjects were given the following problem.


A cab was involved in a hit and run accident at night. Two cab companies, the Green and the Blue, operate in the city. You are given the following data:


(a) 85% of the cabs in the city are Green and 15% are Blue.


(b) A witness identified the cab as Blue. The court tested the reliability of the witness under the same circumstances that existed on the night of the accident and concluded that the witness correctly identified each one of the two colors 80% of the time and failed 20% of the time.


What is the probability that the cab involved in the accident was Blue rather than Green?


Most subjects gave probabilities over 50%, and some gave answers over 80%.


However, using Bayes' theorem, the correct answer found through adding and multiplying the probabilities is actually lower than these estimates: Bayess theorem (also known as Bayess rule) is a result in probability theory, which relates the conditional and marginal probability distributions of random variables. ...

  • There is a 12% chance (15% times 80%) of him correctly identifying a blue cab.
  • There is a 17% chance (85% times 20%) of him incorrectly identifying a green cab as blue.
  • There is therefore a 39% chance that he will identify the cab as blue.
  • This results in a 41% chance (12% divided by 39%) that the cab identified as blue is actually blue.

Representativeness is cited in the similar effect of the gambler's fallacy, the regression fallacy and the conjunction fallacy. The gamblers fallacy is a logical fallacy which encompasses any of the following misconceptions: A random event is more likely to occur because it has not happened for a period of time; A random event is less likely to occur because it has not happened for a period of... The regression (or regressive) fallacy is a logical fallacy where regression towards the mean is seen not as a natural fluctuation but as being brought about by a specific cause. ... The conjunction fallacy is a logical fallacy that occurs when it is assumed that specific conditions are more probable than general ones. ...


Another psychological heuristic found by Tversky and Kahneman is the availability heuristic. It has been suggested that Availability error be merged into this article or section. ...


References

  • Baron, J. (2000). Thinking and Deciding (3d ed.). Cambridge University Press.
  • Kahneman, D., & Tversky, A. (1973). On the Psychology of Prediction. Psychological Review, 80, 237-251.
  • Tversky, A., & Kahneman, D. (1982). Evidential Impact of Base Rates. In D. Kahneman, P. Slovic, & A. Tversky (Eds.), Judgment under Uncertainty: Heuristics and Biases. Cambridge: Cambridge University Press.

External links

  • Changingminds.org: representativeness heuristic

  Results from FactBites:
 
Representativeness heuristic - Wikipedia, the free encyclopedia (592 words)
The representativeness heuristic is a heuristic wherein we assume commonality between objects of similar appearance.
The representative heuristic was first identified by Amos Tversky and Daniel Kahneman.
Representativeness is cited in the similar effect of the gambler's fallacy, the regression fallacy and the conjunction fallacy.
Heuristic - Wikipedia, the free encyclopedia (973 words)
Heuristics are intended to gain computational performance or conceptual simplicity potentially at the cost of accuracy or precision.
In heuristic evaluation, the user interface is reviewed by experts and its compliance to ten usability heuristics (broadly stated characteristics of a good user interface) is assessed and any violating aspects are recorded.
Heuristics and artificial intelligence in finance and investment — The use of heuristics and AI techniques in finance and investment.
  More results at FactBites »


 

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