Yves Le Yaouanq receives an ERC grant to study cognitive biases
How well-informed are we when it comes to making decisions? Whether we're buying a washing machine or a bicycle, making an investment decision, choosing a course of study, or comparing candidates in an election, there are many situations where we consciously or unconsciously have to go out and gather information we don't already have, in order to inform our actions. But it could be that this step is imperfect. Showing and quantifying this is the aim of the PROSPECT project, led by Yves Le Yaouanq at CREST thanks to a Consolidator grant from the European Research Council (ERC).
To answer this question, the researcher draws on the field of behavioral economics, which is concerned with the psychology of individuals and tries to build more realistic decision models than the basic ones, which make very strong assumptions about rationality. “We try to take into account cognitive biases, which tend to affect people's decisions,” explains Yves Le Yaouanq. Numerous studies have analyzed the biases that affect the way we process information we have already been given. Confirmation bias, for example, leads us to attach great importance to information that supports what we already think, or to set it aside if it doesn't.”
PROSPECT focuses on a new, as yet unexplored category of bias, which plays on the way individuals project themselves into information they don't yet know. “It's something we do all the time, implicitly. For example, when you open a book to try to learn about a subject, you don't know what's in it, but you hope it will deliver a lot of interesting information. In doing so, you estimate the value of the information you don't yet have, so you know which is worth seeking out and which can be ignored,” explains the economist. This a priori choice can be a source of bias.
Behavioral and experimental economics
One of Yves Le Yaouanq's hypotheses is that we don't make the effort to seek out enough information, because we underestimate the importance of the information we don't yet have. This would mean, for example, not gathering enough data before making important decisions (choice of insurance, choice of studies or work...). “We may also underestimate what we learn by taking a step to the side and embarking on an experimental effort to seek a different source of information than usual, an important topic for companies and organizations in need of innovation efforts,” adds the researcher.
To test this hypothesis, the project will implement experiments with cohorts of people, initially “in the lab”, where researchers can easily control the information involved. In a second phase, if these biases are indeed detected and measured, the scientists could imagine experiments on real-life applications, during purchases on e-commerce sites for example. For Yves Le Yaouanq, “the primary motivation is to inform people about cognitive biases, so that everyone can try to spot them in themselves and make better decisions. But it's also about informing public policy on the subject.”
*CREST: a joint research unit CNRS, École Polytechnique, GENES, Institut Polytechnique de Paris, 91120 Palaiseau, France