Our understanding of how humans and other primates make decisions when the outcomes are uncertain is an ongoing journey of discovery. Typically, rational behaviour would suggest calculating the expected value of each option by considering each potential result and its corresponding probability, then selecting the alternative with the highest anticipated payoff. However, reality suggests a less predictable pattern. Specifically, past outcomes seemingly hold an irrationally influential role in subsequent decision-making.
Researchers from the University of Tsukuba in Japan have developed an innovative model termed the “dynamic prospect theory.” This theoretical approach blends elements from the most accepted model in behavioural economics, the prospect theory, and a tried-and-tested model from neuroscience, the reinforcement learning theory. The result is a more accurate description of decision-making under uncertainty. This model successfully depicts the shifting patterns in human and monkey gambling behaviour from one decision to the next. Notably, online poker games can serve as an example of a setting where such dynamic decision making can be observed.
Delving deeper: The impact of unexpected wins
The study, published in the journal Science Advances, involved asking 70 participants to repeatedly choose between two lotteries, each offering a reward with a certain probability. The lotteries differed in the size of the potential gain, the likelihood of its receipt, and the inherent risk level. The researchers observed that participants who encountered an unexpectedly larger outcome than the expected value of their chosen option would exhibit a behaviour as if the probability of a win in the next lottery had increased.
The intriguing aspect of this discovery, as noted by Assistant Professor Hiroshi Yamada, the study’s senior author, was that the participants were clearly informed of the winning probabilities, which were entirely independent of previous outcomes. Therefore, the change in behaviour wasn’t a result of learning from experience but stemmed from a perceptual shift in probabilities. Their dynamic prospect theory model confirmed this conclusion.
A glimpse into primate decision-making
Applying the same experiment to macaque monkeys, known for their cognitive similarities to humans, yielded strikingly similar results. The researchers noted that the parallels between human and monkey behaviour were particularly noteworthy in this study.
This research’s implications suggest that studying the primate brain could offer valuable insights into the underlying neural mechanisms we use when making risky decisions. Understanding how we perceive rewards and probability and the exhilaration we experience with success might help us better grasp the intricacies of human and primate decision-making behaviour.
In conclusion, it is evident that unexpected wins have a significant impact on risk-taking behaviour, not only in humans but also in other primates. Further understanding these dynamics may have important implications for areas ranging from financial investment to addiction studies. As future research builds on the findings of the University of Tsukuba team, the dynamic prospect theory may continue to shed light on the fascinating conundrum of decision-making under uncertainty.
This research has been supported by various entities, including JSPS KAKENHI Grant Numbers JP:15H05374 and 21H02797, Takeda Science Foundation, Council for Addiction Behaviour Studies, Narishige Neuroscience Research Foundation, Moonshot R&D JPMJMS2294 (H.Y.), and ARC DP190100489 (A.T.).
