just finished reading Simple Heuristics that make smart – Gigerenzer & Todd (OUP, 2000) – on first appearance a dry academic psychology text on bounded rationality and how we use lots of shortcuts to get close to the right answer to complex practical problems. the slightly artificial but effective example they give is determining German city size.. which is bigger Wiesbaden or Stuttgart? you’ve probably no idea..(German readers – don’t interupt just yet) but may have at least heard of Stuttgart as might surmise that it was larger. Not only would you be right in this case but you’ve just discovered the highly effective “recognition heuristic”.. and whats more your ignorance works for you..
asked to say which was bigger from pairs of biggest 73 german cities, american college students were more accurate than germans in germany.. the result was reversed for american cities. neat huh?
This heuristic can then be extended to something called ‘take the best’ which uses extra information in a very frugal fashion.. all you do is compare two items on the best cue you have..(in this case ‘have i heard of it?’) if your best choice discriminates between them then pick the one it tells you to, if not move to the next best cue (for city size being a state capital or having a premier league sports team are good indicators)
this is a very plausible model of a low cost stategy that might be used in human decision making.. the most surprising thing being that it gives the computationally intensive and informationally exhaustive multiple linear regression a real run for it’s money in accuracy at a fraction of the cost in storage and calculation.
just thought i’d let you know.