Category: Heuristics

The representativeness heuristic is used when making judgments about the probability of an event under uncertainty. It is one of a group of heuristics (simple rules governing judgment or decision making) proposed by psychologists Amos Tversky and Daniel Kahneman in the early 1970s. Heuristics are described as “judgmental shortcuts that generally get us where we need […]

Naïve diversification is a choice heuristic (also known as “diversification heuristic”). Its first demonstration was made by Itamar Simonson in marketing in the context of consumption decisions by individuals. It was subsequently shown in the context of economic and financial decisions. Simonson showed that when people have to make simultaneous choice (e.g. choose now which of […]

The familiarity heuristic was developed based on the discovery of the availability heuristic by psychologists Amos Tversky and Daniel Kahneman; it happens when the familiar is favored over novel places, people, things. The familiarity heuristic can be applied to various situations that individuals experience in day to day life. When these situations appear similar to […]

In psychology, a heuristic refers to an easy-to-compute procedure or “rule of thumb” that people use when forming beliefs, judgments or decisions. Where an exhaustive search for a solution is impractical, heuristic methods are used to speed up the process of finding a satisfactory solution via mental shortcuts to ease the cognitive load of making a […]

The availability heuristic is a mental shortcut that relies on immediate examples that come to mind. The availability heuristic operates on the notion that if something can be recalled, it must be important (“if you can think of it, it must be important.”). Subsequently, people tend to heavily weigh their judgments toward more recent information, making […]