When making decisions, individuals rarely possess all the facts. This can be forgiven in a world where action is time sensitive; life rarely affords the luxury of comprehending all the nuances of an environment. However, individuals do not just ignore valuable information when it is costly to acquire, individuals oftenignore veridical information even when it is freely available. Instead of employing an accurate understanding of a situation, individuals frequently make decisions with the aid of ignorance and misunderstanding. This dissertation attempts to examine why. I argue against the notion that such behaviour is always caused bycognitive limitations. Instead, I demonstrate that ignoring veridical information can be advantageous in a variety of contexts. Throughout this work, I examine several settings where research has shown that individuals consistently ignore freely available information. Using a combination of formal analysis and simulations, I demonstrate that such behaviour can be advantageous. Lacking veridical knowledge can be functional in order to navigate cooperative societies (Chapter 3), unpredictable environments (Chapter 4), investment markets (Chapter 5-7), and inefficient institutions (Chapter 8). Not only does this work contribute to explaining previously confusing human behaviour, it offers insight into the potential advantages of self-deception (Chapter 2).
|Date of Award||3 Jun 2016|
|Supervisor||Joanna Bryson (Supervisor)|
- Decision Making
- Adaptive behaviour
- Incorrect Information