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Formulation of real life decisions: A study of foreign policy decisions
247
Acta Psychologica 56 (1984) 247-265 North-Holland
FORMULATION OF REAL LIFE DECISIONS: FOREIGN POLICY DECISIONS Willem E. SARIS and Irmtraud N. GALLHOFER Unioersity of Amsterdam,
A STUDY OF
*
The Netherlands
A sample of 235 Foreign Policy decisions from 1900 to 1955 was studied with respect to the structures of the argumentations. Although it is assumed in the literature that political decisions are complex value problems with uncertainty, the data did not show any evidence in support of this assumption. However, four groups of simplified structures of decision problems could be detected, based on restrictions specified for characterizing probabilities and/or values. Given these restrictions, it was found that more than two thirds of the decisions were in agreement with the SEU model as a normative criterion for correct decisions. But within the class of “correct” decisions the decision was always made in one and the same way. The decision makers indicated that the preferred strategy led at least to as good a result as the other strategies, but possibly to better results. In this argument probability played only a minor role. Trade offs between utilities and probabilities were not made.
Introduction
In recent years many different rules have been suggested by researchers for describing decision making in experimental studies (e.g., Svenson 1979; Huber 1982). Gallhofer and Saris (1979a, 1982, 1983) have specified some rules necessary to describe decision making in non-experimental research. According to them an argument consists of two parts: (1) The structuring of the decision problem, specifying the possible actions, possible outcomes with eventually some aspects thereof. (2) The evaluation of the outcomes and probabilities in order to complete the argument. Formally one would expect also the specification of a rule which indicates how one should choose, given the descriptions. However, such * Mailing address: W.E. Saris, University of Amsterdam, Dept. of Methods and Techniques for Political Science Research, Grimburgwal 10, gebouw 5, 1012 GA Amsterdam, The Netherlands.
OOOl-6918/84/$3.00
0 1984, Elsevier Science Publishers B.V. (North-Holland)
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rules are omitted as they are obvious. In a study Gallhofer and Saris (1985) have shown that the given information clearly indicates which rule must be used to derive the choice, since an almost perfect ship was found between the level of the provided information rule which would describe In this paper
relationand the
the choice.
we want to indicate,
on the basis
of data relating
to
Dutch Foreign Policy decision making, how the arguments of the politicians were formulated and whether these arguments are in agreement with a normative criterion for correctness of the argument, for which we have chosen the SEU model (Edwards 1954). But before doing so, we shall first specify general case and some specific cases.
Notation
of the general
and some specific
the notation
used for the
cases
Formulated in its full generality, we are dealing here with a complex value problem with uncertainty (Keeney and Raiffa 1976). Political decision problems are mostly of this complex nature. This can be verified by comparing across the information given by different decision makers with respect to attributes which played a role and with respect to the uncertainty involved (Gross-Stein and Tanter 1980; Gallhofer and Saris 1982). However, this does not mean that the problems are always formulated in this way by the individual decision makers themselves. Normally, decision makers simplify the problem, as we shall see later (see also George as follows:
1980).
Common
simplifications
are
(1) Omission of uncertainty, which reduces the problem to one requiring a comparison of outcomes under (assumed) certainty of linkage of a particular choice with a particular outcome. (2) Reduction of a complex value problem to a simple value problem by comparing only wholistic utilities of outcomes instead of partworths of all outcomes or all relevant attributes. (3) A combination of (1) and (2) leads to a decision problem, characterized by certainty and simple values. Examples formulation
of such simplifications of the decision problem
are given in table 1. The first is the most complex description
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
Table 1 Three different simplifications
249
of a complex value problem. Strategies Sl : Occupy the seat of the Republican government
Example 1: Complex value problem without uncertainty
Example 2: Simple value problem with uncertainty
Example 3: Simple value problem without uncertainty
S2: Do nothing
011: Solution of the
021:
problem in Indonesia U(O11): Very positive 012: No increase of the number of victims U( 012): Less negative 013: No deterioration of our intemational position U(O13): Quite negative
Defeat in Indonesia
U(O21): Very negative 022: Great increase of the number of victims (I( 022): Very negative 023: No improvement of our international position U(O23): Quite negative
011: Political reconstruction of Indonesia achieved U( 011): Positive Pll: Highly probable
0 21: The Republic respects the cease fire order U( 021): Positive P21: Very improbable
012: Creation of a new untenable situation U(O12): Negative P12: Very small
022:
011: Liquidation of the Republican government U( 011): Positive
021:
Creation of a new untenable situation U(O22): Negative P22: Very probable Dutch position not improved
U(O21): Negative
Note: The abbreviations indicate the following: Si = strategy i; 00 = outcomej under strategy i; U(Oij) = utility attributed to Oij; Ptj’ = probability of Oij.
given by the decision maker (Van Mook) for the solution of the problems of the Dutch in Indonesia in 1947. In this case the uncertainty is ignored. At another point in time two of the three attributes were ignored but uncertainty was introduced. This is indicated by the second example. A third formulation of the same problem ignores again two attributes
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but also the uncertainty. The third example illustrates this possibility. Such simplifications of the representation of decision problems are part of what we have called the structuring of the argument. One can describe the simplifications with respect to the uncertainty also as a restriction of the decision problem. In the case where the decisions are made without risk, the probability assigned to the single outcome under each strategy is unity: we shall specify this restriction as Pi1 = 1 for all Si.
There are different kinds of complex value representations: some where the same attributes are compared across all outcomes, others where different attributes are considered for different outcomes. In the latter cases, the decision makers cannot make systematic comparisons and therefore, reduce the problem by a summary statement to a simple value problem, comparing U(Oij) for all i. We shall discuss decision problems represented in this way as “simple value” problems. This means that we shall only speak about complex value problems if, for all outcomes, the same attributes are used in the description. The decision makers often introduce further restrictions in the structuring of the problem by specifying the same outcomes for different strategies. This simplifies the representation of a decision problem considerably. These restrictions lead to subclasses of the four classes which table 2 summarizes. They will be discussed in the results. Before continuing with the analysis of these decision problem representations, we shall describe the decision rules identified in this study and give a short description of the data and the methodology used. Decision rules Many different rules are mentioned in the literature (e.g., Simon 1957; Svenson 1979; Vlek and Wagenaar 1979). In the following we summarize only the decision rules which were identified in our sample. Table 2 Classification
of simplifications
Values
Simple values Complex values
of the decision
problems.
Uncertainty Absent
Present
I III
II IV
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The Subjective Expected Utility (SEU) model states that a decision maker should choose the strategy with the highest subjective expected utility. The subjective expected utility of a strategy is defined as a composite function of the values of the outcomes and their probabilities: EU(Si)
= c Pij U(Oij)
where EU(Si) indicates the subjective expected utility under stategy i; Pij the probability of the occurrence of outcome j under strategy i; and U( Oij) the utility of outcome j under strategy i. The Risk-Avoiding rules considered here were developed previously by the authors (Gallhofer and Saris 1979a, b). The choice rule consists of selecting the strategy having the highest probability of positive outcomes or, which amounts to the same thing - since the sum of the probabilities is assumed to be 1 - of selecting the strategy having the lowest probability of negative outcomes. The Risk-Avoiding rules can be expressed more formally for a positive outcome as follows: if P1 + > P2 + - Sl is chosen or equivalently for a negative outcome: ifPl--
*Slischosen
where Pl - , P2 - are the probabilities of negative outcomes under strategy 1 and 2, and Pl -t , P2 + are the probabilities of positive outcomes under strategy 1 and 2, respectively. The Dominance, Lexicographic and Addition of Utilities rules have in common the requirement that the several aspects or dimensions of outcomes are compared systematically. The Dominance rule states that the strategy which is selected should be better than the other(s) on at least one aspect and not worse than the other strategy (-ies) on the remaining aspects. The Lexicographic rule requires first rank-ordering the aspects in importance and then selecting the strategy which is most attractive on the most important attribute. The choice rule of the Addition of Utilities rule requires summing up the values of each aspect per strategy and then selecting the strategy with the highest total value.
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The last two rules, i.e., Simon’s Satisfying rule (Simon 1957: 248) and the Reversed Simon rule, specify the following choice rules: Simon’s rule suggests selecting the (first) strategy detected which leads to satisfactory outcomes only. The Reversed Simon rule, which has been developed by the authors to encompass political situations for which no satisfactory strategy was available, consists of excluding all the strategies which lead with certainty within the problem representation to negative outcomes only, as long as there is another strategy which might lead to a positive result.
Methodology
From a population of 136 Dutch Foreign Policy decision topics, relating to the period of 1900 to 1955, a sample of 50 decision clusters was drawn, relating to a great variety of political topics. For each cluster all the decision-related documents available in the archives of the Dutch Council of Ministers, the departments of Foreign Affairs and Economic Affairs and some private archives of decision makers were collected. In total we obtained 235 individual decisions to analyze. The documents were then subjected to a content analysis, i.e. two coders had each to derive a decision tree representing the problem as presented in the politician’s written report. A highly reliable coding instrument has been developed for the analysis of this type of data (Gallhofer 1978; Gallhofer and Saris 1979~). The procedure provides very good intersubjective agreement (Saris and Gallhofer 1984). For the 235 decisions the average agreement between the two coders on a scale from 0 (no agreement) to 1 (perfect agreement) was 0.88. Comparing their results the two individual coders came to an unanimous conclusion about how to code every decision. Saris and Gallhofer (1984), indicate that this joint agreement will usually be maintained by other teams of coders. Given the decision trees the decision rules could be determined. For the procedure used we refer to Gallhofer and Saris (1985). As mentioned in the last section three classes of simplified representations of decision problems could be detected. These simplifications are based on reskictions. Under restrictions we understand simplifications implicitly indicated through the structure of the “decision tree’, relating to the representations of probabilities and/or utilities of outcomes. Restrictions with respect to probabilities are, e.g. that for several strategies only one outcome (Oi) could occur, given the choice of that strategy (Si), which is indicated in the tree structure by a single branch where Pij = 1 (see example 1 and 3 in table 1). Restrictions with respect to values are frequently indicated by outcomes: e.g. for several strategies the same outcome (01) could be specified which means that V( Oil) = U( Ujl) (see example 2). It also happens that the outcomes relate to the same subject, for instance, defeat or not. When it is claimed that under a specific strategy (Sl) the outcome (011) involves a defeat and under Si this consequence will
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253
not occur then one may conclude that U( 011) -C U( il). This example is also illustrated in table 1. Under specifications we understand statements relating to probabilities and/or utilities which are explicitly indicated by the decision maker, e.g.: that the probability of a positive outcome is higher under a specific strategy (Sl) than under the alternatives (Pl + > Pi + , i # 1) or that the utilities of the outcomes of one strategy are superior to the utilities of the outcomes of the alternative strategies (U( Olj) > U( Oij), i f 1; for all j. Examples of such statements can also be found in table 1. Through identifying several restrictions and specifications, the four main classes of decision problems can be further subdivided in some categories, which will be discussed in detail in the next section.
Results
In this section we shall specify the different arguments used by the decision makers in relation to the different classes of representation of decision problems shown in table 2, using the notation discussed earlier.
Class I: Simple utility problem representations
without uncertainty
The restriction introduced in the structuring of the problem representation argument is as follows:
in the
Restriction I: Pi1 = 1 for all Si This class of decision problems is rather simple. In such cases one only needs to specify that U( 011) is better than all others in order to determine the choice of Sl. This can be done in two different ways: Specification I.1 .: V( 011) > U( Oil) for all i f 1 Specification 1.2.: V( 011) > 0 and U( Oil) < 0 for all i # 1 Specification 1.1. implies that the Dominance rule will be used to derive the conclusion that Sl should be chosen. Specification 1.2. implies that Simon’s rule or the Reversed Simon rule is used. In both cases the decision rule implied in the argument is in agreement with the SEU model. Table 3 summarizes the frequency of the occurrence of these two types of arguments. Table 3 indicates that specifications in agreement with Simon’s rule or the Reversed Simon rule are much more frequent than the ordering required in 1.1. It should be mentioned, however, that the choice is rather arbitrary, but 1.1. is more general. In practice this argument is only used if all outcomes have positive utility; otherwise the decision makers prefer the simpler, second formulation.
W.E. Saris, I.N. Gallhojer / Foreign policy decision making Table 3 Frequency of the argumentsin class 1. Class
Restriction
Specification
Rule
Agrees with SEU
FrequenCY
1.1.
I.:pi=l for all Si
1.1.: (1(011) > U( Oil) for all i f 1
Dominance
Yes
10
1.2.
I.: pi1 = 1 for all Si
1.2.: L/(011) > 0 and U( Oil) -z 0 for all i # 1
Simon/ Reversed Simon
Yes
33
Class II: Simple utility problems with uncertainty In class II the degree of certainty that a particular strategy will lead to a particular outcome can vary. Although more possibilities exist, we found in this study three arguments. Uncertainty exists (a) for only one strategy (category 1I.A.); (b) for all strategies except one (category 1I.B.) or (c) that it exists for all strategies (category KC.). Category II.A.: Cases of uncertainty for onb one strategy In these cases the following restrictions are introduced: Restriction 1l.A.: Pi1 = 1 for all i + 1 This restriction is often combined with restriction ll.A.1.: Restriction Il.A.l.:
V( Oil) < U( 011) for all i f: 1
This latter restriction on the utilities is clear from the description of the decision problem if all strategies lead either to the same outcome or a worse outcome than strategy Sl, and where Sl can also lead to another outcome. If this second outcome for Sl is specified to be better than U(Oil), then it is clear that strategy Sl should be chosen. The specification found in practice is often the following: Specification Il.1 .: V( Oil) < 0 for all i, but U( 012) > 0 Combined with information for strategies except positive outcome verified.
restrictions D.A. and ll.A.l., this specification provides sufficient the choice of Sl according to the Reversed Simon rule because all Sl lead with certainty to a negative outcome. While Sl might lead to a (012). This argument is also in agreement with SEU as can readily be
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251
Sometimes specification 11.1. is given combined with specification 11.2.: Specification 11.2.: P12 > Pll This further specification is not necessary, since one should choose Sl anyway whenever P12 > 0. It is possible that the decision makers indicate these probabilities because they want to strengthen their argument for Sl, stressing that the most attractive outcome (012) is also the most likely, if Sl is chosen. Given this information, we can use the Risk-Avoiding rule to describe the choice proposed in the argument and this decision is also in agreement with the SEU model. It can also occur that restriction II.A.1. is not given in the structuring of the problem. In such cases this restriction has to be specified explicitly in order to use the same argument. This means that restriction 1I.A. is combined with specification II.;., which is identical to restriction II.A.l.: Specification 11.3.: cI(Oi1) < U( 011) for all i # 1. If specification 11.3. is combined with specification II.l., the Reversed Simon rule leads again to the choice of strategy Sl and this decision is in agreement with the SEU model. If this specification 11.3. is combined with specification 11.1. and 11.2. the RiskAvoiding rule can explain the choice as before and this choice is also in agreement with SEU. Furthermore, it also can occur that restriction 1I.A. is only combined with specification 11.1. In this case the Reversed Simon rule can also describe the choice for Si but it is unclear whether this decision is in agreement with SEU as nothing is known about the relationship between U( Oil) and V( 011). If specification 11.2. is added, the choice can again be explained by the Risk-Avoiding rule, but the decision is still not necessarily in agreement with SEU. In this section we have specified 6 different ways of presenting arguments. Table 4 summarizes the frequency of occurrence of these arguments. Category
II. B.:
Uncertainty
/or all strategies
except for one
In this category uncertainty is introduced for all strategies except one. This restriction is formulated in restriction 1I.B. Restriction 1I.B.: Pi1 -C1 for all i # 1, but Pll = 1. This restriction is often combined with restriction II.B.l.: Restriction II.B.l.:
U( 011) > V( Oil) for all i f 1.
The combination of these two restrictions describes a decision problem where one strategy leads with certainty to an outcome which is at least as good as a particular
256
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Table 4 Frequency of the arguments in category 1I.A. Class
Restriction
Specification
Rule
Agrees with SEU
cY
Frequen-
II.A.1.
1I.A.: Pi1 = 1 for all i # 1 II.A.l.: U(Oi1) c U(Ol1) for all i f 1
11.1.: U(Oi1) < 0 for all i but U( 012) > 0
Reversed Simon
Yes
22
II.A.2.:
Pi1 =l for all i # 1 II.A.l.: U(Oi1) < U(O11) for all i # 1
II.l.:U(Oil) i 0 for all i but U(Ol2) > 0 11.2.: P12 > Pll
Riskavoiding
Yes
11
II.A.3.
1I.A.: Pi1 = 1 for all i + 1
II.I.:U(Oil) -=z0 for all i but U(012) > 0 11.3: U(Oi1) Q U(O11) for all i # 1
Reversed Simon
Yes
II.A.4.
1I.A.: Pi1 = 1 for all i # 1
II.l.:U(Oil) -= 0 for all i but U(012) > 0 11.2.:P12 > Pll 11.3.:U(Oil) G U(Ol1) for all i # 1
Riskavoiding
Yes
1I.A.S.
1I.A.: Pi1 = 1 for all i + 1
II.l.:U(Oil) < 0 for all i but U(012) :, 0
Reversed Simon
No
16
II.A.6.
1I.A.: Pi1 = 1 for all i # 1
11.1.: U( Oil) < 0 for all i but U(012) > 0 11.2.: P12 > Pll
Riskavoiding
No
7
outcome which could result under any other strategy. If in such cases it is specified that the other outcomes which could result under these strategies are’ less favorable, the decision is obviously in agreement with Simon’s rule and with the SEU model. The
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257
specification used in this case is as follows: Specification 11.5.: V( 011) > 0 and V( 0i2) < 0 for all i + I Sometimes specification 11.5. is combined with specification 11.6. with respect to the probabilities: Specification 11.6.: Pi2 < Pll,
if
1.
In this case the Risk-Avoiding rule leads also to the choice of Sl although this information is not strictly necessary to prescribe the choice. Here the decision maker probably wanted to strengthen the argument for choosing Sl, stressing the disadvantages of the other strategies in comparison with Sl. Here we also found the choice proposed to be in agreement with the SEU rule. As before, restriction II.B.l. is not always obvious from the structuring of the problem representation. In that case, specification 11.7. has to be added which is identical with restriction II.B.1.: Specification 11.7.: U( 011) > U( Oil) for all i # 1. If specification 11.7. is combined with specification II.S., Simon’s rule can again lead to the choice of strategy Sl and this choice is again in agreement with the SEU model. If specification 11.7. is combined with specification 11.5. and 11.6. the Risk-Avoiding rule can describe the choice and this choice is also in agreement with SEU. Finally, there is again the possibility that specification 11.5. is not given but specification 11.8. is given instead: Specification 11.8.: V( 011) > 0 while II( Oi2) < 0 for all i. In such cases Simon’s rule leads to the choice of Sl, but this choice is not necessarily in agreement with SEU. Also, addition of specification 11.6. does not make the choice in agreement with SEU but then the Risk-Avoiding rule can describe the choice. Table 5 summarizes the frequency of the occurrence of the arguments of category 1I.B. Category
II.C.:
Uncertainty
for all strategies
The last category of arguments in this class (1I.C.) is characterized by the fact that no restrictions are introduced on the probabilities. But, since the arguments would be too complicated in the absence of any restrictions, some restrictions are introduced on the utilities. The first type of restrictions is denoted by II.C.l.: Restriction II.C.l.:
U( 012) > U( Og ) for allj and i # 1.
This restriction says that for Sl outcome 012 is at least as good as any other outcome for the other strategies. Combined with specification 11.5., i.e. U(Ol1) > 0 and LT(0i2) c 0, for all i f 1 the Reversed Simon rule leads to the choice of Sl. As an alternative
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Table 5 Frequency of the arguments in category 1I.B. Class
Restriction
Specification
Rule
Agrees with SEU
cY
II.B.1.
1I.B.: Pi1 < 1 for all i f 1 butPll=l II.B.1.: U(Ol1) > U(Oi1) for all i + 1
11.5.: U(Ol1) 10 and U(Oi2) < 0 foralli#l
Simon
Yes
3
II.B.2.
1I.B.: Pi1 < 1 for all i # 1 butPll=l II.B.1.: U(Ol1) z U( Oil) for all i + 1
11.5.: U(O1l) z 0 and U(Oi2) < 0 for all i f i
Riskavoiding
Yes
3
Frequen-
11.6.: Pi2 < Pll for all i # 1 II.B.3.
1I.B.: Pi1 c 1 foraIli#l butPll=l
11.5.: U(Ol1) > 0 and U( 0i2) < 0 foralli+l 11.7.: U(Ol1) > U(Oi1) for all i f 1
Simon/ Reversed Simon
Yes
4
II.B.4.
1I.B.: Pi1 c 1 for all i + 1 butPll=l
11.5.: U(Ol1) > 0 and U(Oi2) < 0 for all i f 1 11.6.: Pi2 c Pll for all i + 1 11.7.: U(Ol1) > U( Oil) for all i f 1
Riskavoiding
Yes
3
II.B.5.
1I.B.: Pi1 < 1 for all i = 1 butPll=l
11.8.: U(O11) > 0 while U(Oi2) < 0 for all i
Simon
No
5
II.B.6.
1I.B.: Pi1 c 1 for all i # 1 but Pll = 1
11.6.: Pi2 G Pll 11.8.: U(O11) > 0 while U(Oi2) < 0 for all i
Riskavoiding
No
4
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259
specification, specification 11.9. may be used: Specification 11.9.: U( Olj)
> 0 for allj
In this case Simon’s rule leads to the choice of Sl. A specification with respect to the probabilities is used, which can strengthen the argument in favor of strategy Sl if it is indicated that a positive outcome is much more likely to result from the choice of strategy Sl than from the choice derived from the other strategy: Specification 11.10.: Pl + > Pi + , for all i and i # 1. In this case the Risk-Avoiding rule leads to the choice of Sl. In all three cases the choice is in agreement with the SEU model if Pll > 0; as can easily be verified. Instead of restriction II.C.l., restrictions II.C.2. and II.C.3. are sometimes used: Restriction II.C.2.:
(1(01 +) > U( Oi +) for all i # 1
Restriction II.C.3.:
11(01 -)
= U(Oi -)
for all i # 1.
If these two restrictions are combined with specification 11.10. the Risk-Avoiding rule leads to the choice of Sl and this choice is in agreement with SEU, as can be verified. There are also situations where no restriction can be derived from the structuring of the problem representation, but specification 11.10. or 11.9. are given. In such situations the Risk-Avoiding rule or Simon’s rule leads to the choice of Sl. However, it is unclear whether or not this choice is in agreement with SEU. Table 6 summarizes the frequency of occurrence of the different arguments of category 1I.C. Class III:
Complex
value problems
without uncertainty
In this class of problem representations restriction III is always made, indicating that only one outcome results from the choice of any particular strategy, Si: Restriction III : Pi1 = 1 for all i . Furthermore restriction 111.1. is often made, which is as follows: Restriction III.1 .:
U(Xllm)>
U(Xilm)forallmandalli#l.
Where V( Xijm) indicates the utility of the m th aspect of the j th outcome on strategy i. As these restrictions together specify a structure which is in agreement with a dominance situation, it will not be surprising that this rule is used and that this choice is in agreement with the SEU model. In the case where restriction 111.1. is not made, the choice can only be in agreement with SEU if it is indicated that the sum of the part-worths of Sl over all attributes is larger than the sum of the part-worths of all the other strategies, which is indicated by
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Table 6 Frequency of the arguments in category 1I.C. Class
Restriction
II.C.1.
II.C.1.:
U(012)
> l.J(Oij) for allj and all i # 1 II.C.2.
II.C.1.:
U(O12) > U( Oij) for all j andallifl
II.C.3.
II.C.1.:
U(O12) 2 fJ( OU) for all j and all i # 1
Specification
Rule
Agrees with SEU
Reversed Simon
Yes
9
Simon
Yes
6
Riskavoiding
Yes
11.10.: Pl+ > Pi + for all i # 1
Riskavoiding
Yes
18
11.10.: Pl + > Pi + foraIli21
Riskavoiding None
No
17
No
11.5.: U(O11) > 0 and U(Oi2) < 0 for all i # 1
11.9.: U(O1 j) > 0 for all j
11.5.: U(O11) > 0 and U(Oi2) -= 0 for all i + 1
FrequencY
11.9.: U(O1 j) > 0 for all j 11.10.: Pl + > Pi + for all i # 1 II.C.4.
II.C.2.:
U(ol+) > lJ(Oi +) for all i # 1 IJ.C.3.: U(Ol-) z U(Oi -) for all i # 1
II.C.5.
None
II.C.6.
None
11.9.: U(O1 j) > 0 for all j
Simon
II.C.7.
None
None
None
1 4
7
261
W. E. Saris, I. N. Gallhofer / Foreign policy decision making specification 111.1.: Specification 111.1.: C V( Xllm) m
> C U( Xilm) m
for all i + 1.
Thus, if specification 111.1. is made, an additive multiattribute utility rule can explain the choice and this (assuming that attributes are value-wise independent) is again in agreement with the SEU model. On the other hand, sometimes, two other specifications are made: Specification 111.2.:
attribute 1 is the most important attribute
Specification 111.3.: U(Xl11)
> V( Xill)
for all i # 1.
In this case use of the Lexicographic rule is implied by stating simply that one attribute is the most important one. The choice specified by the used rule is not necessarily in agreement with the SEU criterion. Table 7 summarizes the frequency of occurrence of the different arguments in class III. Class IV:
Complex value problems with uncertainty
In this class no restrictions are made with respect to probabilities. But occasionally restrictions regarding values are specified through the way the problem is structured. Table 7 Frequency of the arguments in class III. Class
11.1.
Restriction
III.: Pi1 = 1 for all i 111.1.: U( Xllm) U( Xilm) for all m and all i # 1
111.2.
III.: Pi1 = 1 for all i
Specification
Rule
Agrees with SEU
FrequenCY
None
Dominance
Yes
13
Addition
Yes
13
No
4
>
111.1.: C U(Xllm) 5
U( Xilm
>
Zities
fOmraIli+l
111.3.
III.: Pi1 = 1 for all i
111.2.: Attribute 1 is the most important one 111.3.: U(X111) z U( Xill) foralli+l
Lexicogr.
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262
Restriction IV.1 .:
U(Xllm)>
LI(X12m)forallm,
and
CT(X12111)>U(Xijm)forallj,mandi#l. This restriction clearly identifies one “dominant” strategy Sl. This means that the Dominance rule can describe the choice and that this decision is in agreement with the SEU model. If specification IV.1. is given with respect to the probabilities: Specification IV.1 .:
Pll > Pi1 for all i # 1, where Oil is the most favorable outcome of strategy Si for all i # 1.
The decision to choose Sl can be prescribed on the basis of the full SEU model as intensities of both utilities and probabilities are given. In the case where no restrictions are made, a specification is given with regard to probabilities of outcomes under alternative strategies, this complex value problem is Table 8 Frequency of the arguments in class IV. ChSS
Restriction
Specification
Rule
Agrees with SEU
Frequen-
IV.1.
IV.l.: U(Xllm) z U(X12m) for all m and U(X12m) > U( Xijm ) for allj, m andi#l
None
Dominance
Yes
4
IV.2.
IV.l.: U(Xllm) U(X12m) for all m and U(Xl2m) U( Xijm) for all j, m and if1
IV.1.: Pll> Pi1 foralli#l where Oil is the most favorable outcome of strategy Si for all if1
SEU
Yes
1
IV.2.: Attribute 1 is the most important one None
Lexicogr.
No
2
None
No
3
IV.3.
None
>
>
cY
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
263
not easily solved. In this case the choice rule proposed, like the Lexicographic rule, will not necessarily prescribe a choice in agreement with the SEU model. The frequency of occurrence of the different structurings of class IV problem representations are indicated in table 8.
Discussion
Having described the different kinds of arguments which we found in our study, we shall now draw some conclusions. It would seem to us that most political decision problems need to be represented as complex value problems with uncertainty (see also George 1980; Gross-Stein and Tanter 1980). However, our data show little evidence for the representation of problems in this way in the arguments of the decision makers we studied. Class IV contains in fact the lowest number of cases, i.e. 10. The reason for this low frequency is obvious: without decision aids it is impossible to evaluate problems represented in this way, let alone convince somebody else of the correctness of one’s decision. Our analysis shows that the complex value problem is most often reduced to a simple value problem, allowing for uncertainty: class II contains 152 cases. But within this most populated class more than 50% of the cases are even further simplified by introducing more restrictions on the probabilities. Two types of restrictions were evident: one, where only one strategy is represented as having uncertain outcomes and the other, where one strategy has only one certain outcome. Furthermore, there are even 43 cases where all uncertainty is ignored and certainty of relations between strategies and outcomes is assumed (class I). A second interesting outcome of our study is that 171 out of the 235 proposed decisions are in agreement with the SEU model. This high degree of agreement stems however from the restrictions imposed on the decision situation. The SEU rule itself is hardly used in producing choice and the heuristic rules which are themselves implicitly proposed do not guarantee a decision in agreement with SEU in the general case, i.e. in the absence of restrictions on the way the problem may be structured. A third, remarkable result is that in all decisions which are in agreement with the SEU model, the probabilities of the outcomes under the various strategies are not of importance for the argument. For the
264
WE. Saris, I. N. Gallhofer / Foreign policy decision making
decisions in class I and III this is automatically true. In class II the “SEU decisions” are all decisions where the chosen strategy leads with certainty to an outcome, at least as good as that which any other strategy could optimally reach, while for the chosen strategy there is also a chance to obtain a better outcome. In the class II situations, probabilities which are specified have the function of strengthening
the
the
since they indicate that for the chosen strategy the most attractive outcome is also the most likely outcome and/or for the rejected strategies the less favorable outcomes are more likely. In all these situations the argument is clear, and, given the way the pattern is structured, correct without any doubt. In fact the decision makers always used an argument which states that the prescribed strategy will lead to outcomes which are certainly as good or better than the outcomes of any other strategy. It is clear that in such situations one can ignore uncertainty, apart particular outcomes since the argument will always hold. In the other 64 cases, where it is unclear whether the preferred choice is in agreement with the SEU model, the argument is less convincing, as it is apparent that some information is lacking within the problem representation. In class I such cases do not occur. In class 1I.A. and II.B., for 31 cases out of 86 the restriction that the chosen strategy certainly leads to better outcomes is not introduced. In these cases an explicit trade off has to be made between the various utilities and probabilities to ensure that the choice is in agreement with SEU, but this is not done. The decision makers’ choices still conform to simple rules, like the Risk-Avoiding-, the Reversed Simon- and Simon’s rule, which would only ensure agreement with SEU when employed in
argument,
conjunction restrictions, In class
with the restrictions mentioned above. In these cases, these which make the choice convincing, are not given. III
there
is sometimes
no simple
solution
because
of the
complex value structure. In 4 such cases the decision makers rely on a Lexicographic rule. This rule does not provide a particularly strong argument as its prescriptions can very easily be attracted on the basis of information with the pattern of representation. In general in class IV the problem representation is too complex for unaided apprehension and it does not even become clear sometimes how the decision makers arrived at their choice without imposing further restrictions on the way they represented the problem to themselves.
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
265
This overview suggests that the decision makers never depend on such a complex rule as SEU, but always use simpler rules. In the majority of cases such arguments are convincing, due to the restrictions introduced in the way the problem is structured, which bring the prescriptions made on the basis of these rules into SEU. But in some cases these restrictions are not introduced, and in these situations the decision makers we studied continue to use the same arguments (i.e. those characterized by the implicit use of Simon’s rule, the Reversed Simon rule and the Risk-Avoiding rule). Whether or not other decision makers in this type of situations do also in general accept these rules as a valid basis for determining their choices (rather than purposing and justifying them) is an open question, which requires further research. References Edwards, W., 1954. The theory of decision making. Psychological Bulletin 51, 380-417. Gallhofer, I.N., 1978. Coders’ reliability in the study of decision making concepts, replications in time and across topics. Methoden en Data Nieuwsbrief, Sociaal Wetenschappelijke Sectie van de Vereniging voor Statistiek, vol. 1 (februari). Gallhofer, I.N. and W.E. Saris, 1979a. Strategy choices of foreign policy decision makers: The Netherlands 1914. Journal of Conflict Resolution. (Since this edition contains several errors caused by printing a corrected reprint can be provided by the authors.) Gallhofer, I.N. and W.E. Saris, 1979b. The decision of the Dutch Council of Ministers and the Military Commander-in-Chief relating to the reduction of armed forces in the autumn of 1916. Acta Politica 1, 95-105. Gallhofer, I.N. and W.E. Saris, 1979~. An analysis of the argumentation of decision makers using decision trees. Quality and Quantity 13, 411-430. Gallhofer, I.N. and W.E. Saris, 1982. A decision theoretical analysis of decisions of the Dutch government with respect to Indonesia. Quality and Quantity 16, 313-344. Gallhofer, I.N. and W.E. Saris, 1985. ‘Explanation of the use of decision rules: a study of foreign policy decisions’. In: I.N. Gallhofer and W.E. Saris (eds.), Comparison of different content analysis procedures for decision making. (Forthcoming.) George, A.L., 1980. Presidential decision making in foreign policy. Boulder, CO: Westview Press. Gross-Stein, J. and R. Tamer, 1980. Rational decision making, Israel’s Security choices 1967. Columbus, OH: Ohio State University Press. Huber, O., 1982. Entscheiden als Problemlosen. Bern-Stuttgart-Wien: Verlag Hans Huber. Keeney, R.L. and H. Raiffa, 1976. Decisions with multiple objectives: preferences and value trade offs. New York: J. Wiley. Saris, W.E. and I.N. Gallhofer, 1984. A coding instrument for empirical research of political decision making. (Submitted for publication in the Spanish Revista de Sociologica.) Simon, H.A., 1957. ‘A behavioral model of rational choice’. In: Models of Man: social and rational, ch. 14. New York: J. Wiley. Svenson, O., 1979. Process descriptions of decision making. Organizational Behavior and Human Performance 23, 86-112. Vlek, Ch. and W.A. Wagenaar, 1979. ‘Judgement and decision under uncertainty’. In: J.A. Michon, E.G.J. Eijkman and L.F.W. de Klerk (eds.), Handbook of psychonomics, vol. II. Amsterdam: North-Holland.
Acta Psychologica 56 (1984) 247-265 North-Holland
FORMULATION OF REAL LIFE DECISIONS: FOREIGN POLICY DECISIONS Willem E. SARIS and Irmtraud N. GALLHOFER Unioersity of Amsterdam,
A STUDY OF
*
The Netherlands
A sample of 235 Foreign Policy decisions from 1900 to 1955 was studied with respect to the structures of the argumentations. Although it is assumed in the literature that political decisions are complex value problems with uncertainty, the data did not show any evidence in support of this assumption. However, four groups of simplified structures of decision problems could be detected, based on restrictions specified for characterizing probabilities and/or values. Given these restrictions, it was found that more than two thirds of the decisions were in agreement with the SEU model as a normative criterion for correct decisions. But within the class of “correct” decisions the decision was always made in one and the same way. The decision makers indicated that the preferred strategy led at least to as good a result as the other strategies, but possibly to better results. In this argument probability played only a minor role. Trade offs between utilities and probabilities were not made.
Introduction
In recent years many different rules have been suggested by researchers for describing decision making in experimental studies (e.g., Svenson 1979; Huber 1982). Gallhofer and Saris (1979a, 1982, 1983) have specified some rules necessary to describe decision making in non-experimental research. According to them an argument consists of two parts: (1) The structuring of the decision problem, specifying the possible actions, possible outcomes with eventually some aspects thereof. (2) The evaluation of the outcomes and probabilities in order to complete the argument. Formally one would expect also the specification of a rule which indicates how one should choose, given the descriptions. However, such * Mailing address: W.E. Saris, University of Amsterdam, Dept. of Methods and Techniques for Political Science Research, Grimburgwal 10, gebouw 5, 1012 GA Amsterdam, The Netherlands.
OOOl-6918/84/$3.00
0 1984, Elsevier Science Publishers B.V. (North-Holland)
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W.E. Saris, I. N. Gallhofer / Foreign poiicy decision making
rules are omitted as they are obvious. In a study Gallhofer and Saris (1985) have shown that the given information clearly indicates which rule must be used to derive the choice, since an almost perfect ship was found between the level of the provided information rule which would describe In this paper
relationand the
the choice.
we want to indicate,
on the basis
of data relating
to
Dutch Foreign Policy decision making, how the arguments of the politicians were formulated and whether these arguments are in agreement with a normative criterion for correctness of the argument, for which we have chosen the SEU model (Edwards 1954). But before doing so, we shall first specify general case and some specific cases.
Notation
of the general
and some specific
the notation
used for the
cases
Formulated in its full generality, we are dealing here with a complex value problem with uncertainty (Keeney and Raiffa 1976). Political decision problems are mostly of this complex nature. This can be verified by comparing across the information given by different decision makers with respect to attributes which played a role and with respect to the uncertainty involved (Gross-Stein and Tanter 1980; Gallhofer and Saris 1982). However, this does not mean that the problems are always formulated in this way by the individual decision makers themselves. Normally, decision makers simplify the problem, as we shall see later (see also George as follows:
1980).
Common
simplifications
are
(1) Omission of uncertainty, which reduces the problem to one requiring a comparison of outcomes under (assumed) certainty of linkage of a particular choice with a particular outcome. (2) Reduction of a complex value problem to a simple value problem by comparing only wholistic utilities of outcomes instead of partworths of all outcomes or all relevant attributes. (3) A combination of (1) and (2) leads to a decision problem, characterized by certainty and simple values. Examples formulation
of such simplifications of the decision problem
are given in table 1. The first is the most complex description
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
Table 1 Three different simplifications
249
of a complex value problem. Strategies Sl : Occupy the seat of the Republican government
Example 1: Complex value problem without uncertainty
Example 2: Simple value problem with uncertainty
Example 3: Simple value problem without uncertainty
S2: Do nothing
011: Solution of the
021:
problem in Indonesia U(O11): Very positive 012: No increase of the number of victims U( 012): Less negative 013: No deterioration of our intemational position U(O13): Quite negative
Defeat in Indonesia
U(O21): Very negative 022: Great increase of the number of victims (I( 022): Very negative 023: No improvement of our international position U(O23): Quite negative
011: Political reconstruction of Indonesia achieved U( 011): Positive Pll: Highly probable
0 21: The Republic respects the cease fire order U( 021): Positive P21: Very improbable
012: Creation of a new untenable situation U(O12): Negative P12: Very small
022:
011: Liquidation of the Republican government U( 011): Positive
021:
Creation of a new untenable situation U(O22): Negative P22: Very probable Dutch position not improved
U(O21): Negative
Note: The abbreviations indicate the following: Si = strategy i; 00 = outcomej under strategy i; U(Oij) = utility attributed to Oij; Ptj’ = probability of Oij.
given by the decision maker (Van Mook) for the solution of the problems of the Dutch in Indonesia in 1947. In this case the uncertainty is ignored. At another point in time two of the three attributes were ignored but uncertainty was introduced. This is indicated by the second example. A third formulation of the same problem ignores again two attributes
W.E. Saris, I.N. Gallhofer / Foreign policy decision making
250
but also the uncertainty. The third example illustrates this possibility. Such simplifications of the representation of decision problems are part of what we have called the structuring of the argument. One can describe the simplifications with respect to the uncertainty also as a restriction of the decision problem. In the case where the decisions are made without risk, the probability assigned to the single outcome under each strategy is unity: we shall specify this restriction as Pi1 = 1 for all Si.
There are different kinds of complex value representations: some where the same attributes are compared across all outcomes, others where different attributes are considered for different outcomes. In the latter cases, the decision makers cannot make systematic comparisons and therefore, reduce the problem by a summary statement to a simple value problem, comparing U(Oij) for all i. We shall discuss decision problems represented in this way as “simple value” problems. This means that we shall only speak about complex value problems if, for all outcomes, the same attributes are used in the description. The decision makers often introduce further restrictions in the structuring of the problem by specifying the same outcomes for different strategies. This simplifies the representation of a decision problem considerably. These restrictions lead to subclasses of the four classes which table 2 summarizes. They will be discussed in the results. Before continuing with the analysis of these decision problem representations, we shall describe the decision rules identified in this study and give a short description of the data and the methodology used. Decision rules Many different rules are mentioned in the literature (e.g., Simon 1957; Svenson 1979; Vlek and Wagenaar 1979). In the following we summarize only the decision rules which were identified in our sample. Table 2 Classification
of simplifications
Values
Simple values Complex values
of the decision
problems.
Uncertainty Absent
Present
I III
II IV
W. E. Saris, I. N. Callhofer / Foreign policy decision making
251
The Subjective Expected Utility (SEU) model states that a decision maker should choose the strategy with the highest subjective expected utility. The subjective expected utility of a strategy is defined as a composite function of the values of the outcomes and their probabilities: EU(Si)
= c Pij U(Oij)
where EU(Si) indicates the subjective expected utility under stategy i; Pij the probability of the occurrence of outcome j under strategy i; and U( Oij) the utility of outcome j under strategy i. The Risk-Avoiding rules considered here were developed previously by the authors (Gallhofer and Saris 1979a, b). The choice rule consists of selecting the strategy having the highest probability of positive outcomes or, which amounts to the same thing - since the sum of the probabilities is assumed to be 1 - of selecting the strategy having the lowest probability of negative outcomes. The Risk-Avoiding rules can be expressed more formally for a positive outcome as follows: if P1 + > P2 + - Sl is chosen or equivalently for a negative outcome: ifPl--
*Slischosen
where Pl - , P2 - are the probabilities of negative outcomes under strategy 1 and 2, and Pl -t , P2 + are the probabilities of positive outcomes under strategy 1 and 2, respectively. The Dominance, Lexicographic and Addition of Utilities rules have in common the requirement that the several aspects or dimensions of outcomes are compared systematically. The Dominance rule states that the strategy which is selected should be better than the other(s) on at least one aspect and not worse than the other strategy (-ies) on the remaining aspects. The Lexicographic rule requires first rank-ordering the aspects in importance and then selecting the strategy which is most attractive on the most important attribute. The choice rule of the Addition of Utilities rule requires summing up the values of each aspect per strategy and then selecting the strategy with the highest total value.
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W. E. Saris, I.N. Gallhofer / Foreign policy decision making
The last two rules, i.e., Simon’s Satisfying rule (Simon 1957: 248) and the Reversed Simon rule, specify the following choice rules: Simon’s rule suggests selecting the (first) strategy detected which leads to satisfactory outcomes only. The Reversed Simon rule, which has been developed by the authors to encompass political situations for which no satisfactory strategy was available, consists of excluding all the strategies which lead with certainty within the problem representation to negative outcomes only, as long as there is another strategy which might lead to a positive result.
Methodology
From a population of 136 Dutch Foreign Policy decision topics, relating to the period of 1900 to 1955, a sample of 50 decision clusters was drawn, relating to a great variety of political topics. For each cluster all the decision-related documents available in the archives of the Dutch Council of Ministers, the departments of Foreign Affairs and Economic Affairs and some private archives of decision makers were collected. In total we obtained 235 individual decisions to analyze. The documents were then subjected to a content analysis, i.e. two coders had each to derive a decision tree representing the problem as presented in the politician’s written report. A highly reliable coding instrument has been developed for the analysis of this type of data (Gallhofer 1978; Gallhofer and Saris 1979~). The procedure provides very good intersubjective agreement (Saris and Gallhofer 1984). For the 235 decisions the average agreement between the two coders on a scale from 0 (no agreement) to 1 (perfect agreement) was 0.88. Comparing their results the two individual coders came to an unanimous conclusion about how to code every decision. Saris and Gallhofer (1984), indicate that this joint agreement will usually be maintained by other teams of coders. Given the decision trees the decision rules could be determined. For the procedure used we refer to Gallhofer and Saris (1985). As mentioned in the last section three classes of simplified representations of decision problems could be detected. These simplifications are based on reskictions. Under restrictions we understand simplifications implicitly indicated through the structure of the “decision tree’, relating to the representations of probabilities and/or utilities of outcomes. Restrictions with respect to probabilities are, e.g. that for several strategies only one outcome (Oi) could occur, given the choice of that strategy (Si), which is indicated in the tree structure by a single branch where Pij = 1 (see example 1 and 3 in table 1). Restrictions with respect to values are frequently indicated by outcomes: e.g. for several strategies the same outcome (01) could be specified which means that V( Oil) = U( Ujl) (see example 2). It also happens that the outcomes relate to the same subject, for instance, defeat or not. When it is claimed that under a specific strategy (Sl) the outcome (011) involves a defeat and under Si this consequence will
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
253
not occur then one may conclude that U( 011) -C U( il). This example is also illustrated in table 1. Under specifications we understand statements relating to probabilities and/or utilities which are explicitly indicated by the decision maker, e.g.: that the probability of a positive outcome is higher under a specific strategy (Sl) than under the alternatives (Pl + > Pi + , i # 1) or that the utilities of the outcomes of one strategy are superior to the utilities of the outcomes of the alternative strategies (U( Olj) > U( Oij), i f 1; for all j. Examples of such statements can also be found in table 1. Through identifying several restrictions and specifications, the four main classes of decision problems can be further subdivided in some categories, which will be discussed in detail in the next section.
Results
In this section we shall specify the different arguments used by the decision makers in relation to the different classes of representation of decision problems shown in table 2, using the notation discussed earlier.
Class I: Simple utility problem representations
without uncertainty
The restriction introduced in the structuring of the problem representation argument is as follows:
in the
Restriction I: Pi1 = 1 for all Si This class of decision problems is rather simple. In such cases one only needs to specify that U( 011) is better than all others in order to determine the choice of Sl. This can be done in two different ways: Specification I.1 .: V( 011) > U( Oil) for all i f 1 Specification 1.2.: V( 011) > 0 and U( Oil) < 0 for all i # 1 Specification 1.1. implies that the Dominance rule will be used to derive the conclusion that Sl should be chosen. Specification 1.2. implies that Simon’s rule or the Reversed Simon rule is used. In both cases the decision rule implied in the argument is in agreement with the SEU model. Table 3 summarizes the frequency of the occurrence of these two types of arguments. Table 3 indicates that specifications in agreement with Simon’s rule or the Reversed Simon rule are much more frequent than the ordering required in 1.1. It should be mentioned, however, that the choice is rather arbitrary, but 1.1. is more general. In practice this argument is only used if all outcomes have positive utility; otherwise the decision makers prefer the simpler, second formulation.
W.E. Saris, I.N. Gallhojer / Foreign policy decision making Table 3 Frequency of the argumentsin class 1. Class
Restriction
Specification
Rule
Agrees with SEU
FrequenCY
1.1.
I.:pi=l for all Si
1.1.: (1(011) > U( Oil) for all i f 1
Dominance
Yes
10
1.2.
I.: pi1 = 1 for all Si
1.2.: L/(011) > 0 and U( Oil) -z 0 for all i # 1
Simon/ Reversed Simon
Yes
33
Class II: Simple utility problems with uncertainty In class II the degree of certainty that a particular strategy will lead to a particular outcome can vary. Although more possibilities exist, we found in this study three arguments. Uncertainty exists (a) for only one strategy (category 1I.A.); (b) for all strategies except one (category 1I.B.) or (c) that it exists for all strategies (category KC.). Category II.A.: Cases of uncertainty for onb one strategy In these cases the following restrictions are introduced: Restriction 1l.A.: Pi1 = 1 for all i + 1 This restriction is often combined with restriction ll.A.1.: Restriction Il.A.l.:
V( Oil) < U( 011) for all i f: 1
This latter restriction on the utilities is clear from the description of the decision problem if all strategies lead either to the same outcome or a worse outcome than strategy Sl, and where Sl can also lead to another outcome. If this second outcome for Sl is specified to be better than U(Oil), then it is clear that strategy Sl should be chosen. The specification found in practice is often the following: Specification Il.1 .: V( Oil) < 0 for all i, but U( 012) > 0 Combined with information for strategies except positive outcome verified.
restrictions D.A. and ll.A.l., this specification provides sufficient the choice of Sl according to the Reversed Simon rule because all Sl lead with certainty to a negative outcome. While Sl might lead to a (012). This argument is also in agreement with SEU as can readily be
W. E. Saris, I. N. Gailhofer / Foreign policy decision making
251
Sometimes specification 11.1. is given combined with specification 11.2.: Specification 11.2.: P12 > Pll This further specification is not necessary, since one should choose Sl anyway whenever P12 > 0. It is possible that the decision makers indicate these probabilities because they want to strengthen their argument for Sl, stressing that the most attractive outcome (012) is also the most likely, if Sl is chosen. Given this information, we can use the Risk-Avoiding rule to describe the choice proposed in the argument and this decision is also in agreement with the SEU model. It can also occur that restriction II.A.1. is not given in the structuring of the problem. In such cases this restriction has to be specified explicitly in order to use the same argument. This means that restriction 1I.A. is combined with specification II.;., which is identical to restriction II.A.l.: Specification 11.3.: cI(Oi1) < U( 011) for all i # 1. If specification 11.3. is combined with specification II.l., the Reversed Simon rule leads again to the choice of strategy Sl and this decision is in agreement with the SEU model. If this specification 11.3. is combined with specification 11.1. and 11.2. the RiskAvoiding rule can explain the choice as before and this choice is also in agreement with SEU. Furthermore, it also can occur that restriction 1I.A. is only combined with specification 11.1. In this case the Reversed Simon rule can also describe the choice for Si but it is unclear whether this decision is in agreement with SEU as nothing is known about the relationship between U( Oil) and V( 011). If specification 11.2. is added, the choice can again be explained by the Risk-Avoiding rule, but the decision is still not necessarily in agreement with SEU. In this section we have specified 6 different ways of presenting arguments. Table 4 summarizes the frequency of occurrence of these arguments. Category
II. B.:
Uncertainty
/or all strategies
except for one
In this category uncertainty is introduced for all strategies except one. This restriction is formulated in restriction 1I.B. Restriction 1I.B.: Pi1 -C1 for all i # 1, but Pll = 1. This restriction is often combined with restriction II.B.l.: Restriction II.B.l.:
U( 011) > V( Oil) for all i f 1.
The combination of these two restrictions describes a decision problem where one strategy leads with certainty to an outcome which is at least as good as a particular
256
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
Table 4 Frequency of the arguments in category 1I.A. Class
Restriction
Specification
Rule
Agrees with SEU
cY
Frequen-
II.A.1.
1I.A.: Pi1 = 1 for all i # 1 II.A.l.: U(Oi1) c U(Ol1) for all i f 1
11.1.: U(Oi1) < 0 for all i but U( 012) > 0
Reversed Simon
Yes
22
II.A.2.:
Pi1 =l for all i # 1 II.A.l.: U(Oi1) < U(O11) for all i # 1
II.l.:U(Oil) i 0 for all i but U(Ol2) > 0 11.2.: P12 > Pll
Riskavoiding
Yes
11
II.A.3.
1I.A.: Pi1 = 1 for all i + 1
II.I.:U(Oil) -=z0 for all i but U(012) > 0 11.3: U(Oi1) Q U(O11) for all i # 1
Reversed Simon
Yes
II.A.4.
1I.A.: Pi1 = 1 for all i # 1
II.l.:U(Oil) -= 0 for all i but U(012) > 0 11.2.:P12 > Pll 11.3.:U(Oil) G U(Ol1) for all i # 1
Riskavoiding
Yes
1I.A.S.
1I.A.: Pi1 = 1 for all i + 1
II.l.:U(Oil) < 0 for all i but U(012) :, 0
Reversed Simon
No
16
II.A.6.
1I.A.: Pi1 = 1 for all i # 1
11.1.: U( Oil) < 0 for all i but U(012) > 0 11.2.: P12 > Pll
Riskavoiding
No
7
outcome which could result under any other strategy. If in such cases it is specified that the other outcomes which could result under these strategies are’ less favorable, the decision is obviously in agreement with Simon’s rule and with the SEU model. The
W. E. Saris; I. N. Gallhofer / Foreign policy decision making
257
specification used in this case is as follows: Specification 11.5.: V( 011) > 0 and V( 0i2) < 0 for all i + I Sometimes specification 11.5. is combined with specification 11.6. with respect to the probabilities: Specification 11.6.: Pi2 < Pll,
if
1.
In this case the Risk-Avoiding rule leads also to the choice of Sl although this information is not strictly necessary to prescribe the choice. Here the decision maker probably wanted to strengthen the argument for choosing Sl, stressing the disadvantages of the other strategies in comparison with Sl. Here we also found the choice proposed to be in agreement with the SEU rule. As before, restriction II.B.l. is not always obvious from the structuring of the problem representation. In that case, specification 11.7. has to be added which is identical with restriction II.B.1.: Specification 11.7.: U( 011) > U( Oil) for all i # 1. If specification 11.7. is combined with specification II.S., Simon’s rule can again lead to the choice of strategy Sl and this choice is again in agreement with the SEU model. If specification 11.7. is combined with specification 11.5. and 11.6. the Risk-Avoiding rule can describe the choice and this choice is also in agreement with SEU. Finally, there is again the possibility that specification 11.5. is not given but specification 11.8. is given instead: Specification 11.8.: V( 011) > 0 while II( Oi2) < 0 for all i. In such cases Simon’s rule leads to the choice of Sl, but this choice is not necessarily in agreement with SEU. Also, addition of specification 11.6. does not make the choice in agreement with SEU but then the Risk-Avoiding rule can describe the choice. Table 5 summarizes the frequency of the occurrence of the arguments of category 1I.B. Category
II.C.:
Uncertainty
for all strategies
The last category of arguments in this class (1I.C.) is characterized by the fact that no restrictions are introduced on the probabilities. But, since the arguments would be too complicated in the absence of any restrictions, some restrictions are introduced on the utilities. The first type of restrictions is denoted by II.C.l.: Restriction II.C.l.:
U( 012) > U( Og ) for allj and i # 1.
This restriction says that for Sl outcome 012 is at least as good as any other outcome for the other strategies. Combined with specification 11.5., i.e. U(Ol1) > 0 and LT(0i2) c 0, for all i f 1 the Reversed Simon rule leads to the choice of Sl. As an alternative
258
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
Table 5 Frequency of the arguments in category 1I.B. Class
Restriction
Specification
Rule
Agrees with SEU
cY
II.B.1.
1I.B.: Pi1 < 1 for all i f 1 butPll=l II.B.1.: U(Ol1) > U(Oi1) for all i + 1
11.5.: U(Ol1) 10 and U(Oi2) < 0 foralli#l
Simon
Yes
3
II.B.2.
1I.B.: Pi1 < 1 for all i # 1 butPll=l II.B.1.: U(Ol1) z U( Oil) for all i + 1
11.5.: U(O1l) z 0 and U(Oi2) < 0 for all i f i
Riskavoiding
Yes
3
Frequen-
11.6.: Pi2 < Pll for all i # 1 II.B.3.
1I.B.: Pi1 c 1 foraIli#l butPll=l
11.5.: U(Ol1) > 0 and U( 0i2) < 0 foralli+l 11.7.: U(Ol1) > U(Oi1) for all i f 1
Simon/ Reversed Simon
Yes
4
II.B.4.
1I.B.: Pi1 c 1 for all i + 1 butPll=l
11.5.: U(Ol1) > 0 and U(Oi2) < 0 for all i f 1 11.6.: Pi2 c Pll for all i + 1 11.7.: U(Ol1) > U( Oil) for all i f 1
Riskavoiding
Yes
3
II.B.5.
1I.B.: Pi1 < 1 for all i = 1 butPll=l
11.8.: U(O11) > 0 while U(Oi2) < 0 for all i
Simon
No
5
II.B.6.
1I.B.: Pi1 c 1 for all i # 1 but Pll = 1
11.6.: Pi2 G Pll 11.8.: U(O11) > 0 while U(Oi2) < 0 for all i
Riskavoiding
No
4
W. E. Saris, I. N. GaNhofer / Foreign policy decision making
259
specification, specification 11.9. may be used: Specification 11.9.: U( Olj)
> 0 for allj
In this case Simon’s rule leads to the choice of Sl. A specification with respect to the probabilities is used, which can strengthen the argument in favor of strategy Sl if it is indicated that a positive outcome is much more likely to result from the choice of strategy Sl than from the choice derived from the other strategy: Specification 11.10.: Pl + > Pi + , for all i and i # 1. In this case the Risk-Avoiding rule leads to the choice of Sl. In all three cases the choice is in agreement with the SEU model if Pll > 0; as can easily be verified. Instead of restriction II.C.l., restrictions II.C.2. and II.C.3. are sometimes used: Restriction II.C.2.:
(1(01 +) > U( Oi +) for all i # 1
Restriction II.C.3.:
11(01 -)
= U(Oi -)
for all i # 1.
If these two restrictions are combined with specification 11.10. the Risk-Avoiding rule leads to the choice of Sl and this choice is in agreement with SEU, as can be verified. There are also situations where no restriction can be derived from the structuring of the problem representation, but specification 11.10. or 11.9. are given. In such situations the Risk-Avoiding rule or Simon’s rule leads to the choice of Sl. However, it is unclear whether or not this choice is in agreement with SEU. Table 6 summarizes the frequency of occurrence of the different arguments of category 1I.C. Class III:
Complex
value problems
without uncertainty
In this class of problem representations restriction III is always made, indicating that only one outcome results from the choice of any particular strategy, Si: Restriction III : Pi1 = 1 for all i . Furthermore restriction 111.1. is often made, which is as follows: Restriction III.1 .:
U(Xllm)>
U(Xilm)forallmandalli#l.
Where V( Xijm) indicates the utility of the m th aspect of the j th outcome on strategy i. As these restrictions together specify a structure which is in agreement with a dominance situation, it will not be surprising that this rule is used and that this choice is in agreement with the SEU model. In the case where restriction 111.1. is not made, the choice can only be in agreement with SEU if it is indicated that the sum of the part-worths of Sl over all attributes is larger than the sum of the part-worths of all the other strategies, which is indicated by
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W. E. Saris, I. N. Gallhofer / Foreign policy decision making
Table 6 Frequency of the arguments in category 1I.C. Class
Restriction
II.C.1.
II.C.1.:
U(012)
> l.J(Oij) for allj and all i # 1 II.C.2.
II.C.1.:
U(O12) > U( Oij) for all j andallifl
II.C.3.
II.C.1.:
U(O12) 2 fJ( OU) for all j and all i # 1
Specification
Rule
Agrees with SEU
Reversed Simon
Yes
9
Simon
Yes
6
Riskavoiding
Yes
11.10.: Pl+ > Pi + for all i # 1
Riskavoiding
Yes
18
11.10.: Pl + > Pi + foraIli21
Riskavoiding None
No
17
No
11.5.: U(O11) > 0 and U(Oi2) < 0 for all i # 1
11.9.: U(O1 j) > 0 for all j
11.5.: U(O11) > 0 and U(Oi2) -= 0 for all i + 1
FrequencY
11.9.: U(O1 j) > 0 for all j 11.10.: Pl + > Pi + for all i # 1 II.C.4.
II.C.2.:
U(ol+) > lJ(Oi +) for all i # 1 IJ.C.3.: U(Ol-) z U(Oi -) for all i # 1
II.C.5.
None
II.C.6.
None
11.9.: U(O1 j) > 0 for all j
Simon
II.C.7.
None
None
None
1 4
7
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W. E. Saris, I. N. Gallhofer / Foreign policy decision making specification 111.1.: Specification 111.1.: C V( Xllm) m
> C U( Xilm) m
for all i + 1.
Thus, if specification 111.1. is made, an additive multiattribute utility rule can explain the choice and this (assuming that attributes are value-wise independent) is again in agreement with the SEU model. On the other hand, sometimes, two other specifications are made: Specification 111.2.:
attribute 1 is the most important attribute
Specification 111.3.: U(Xl11)
> V( Xill)
for all i # 1.
In this case use of the Lexicographic rule is implied by stating simply that one attribute is the most important one. The choice specified by the used rule is not necessarily in agreement with the SEU criterion. Table 7 summarizes the frequency of occurrence of the different arguments in class III. Class IV:
Complex value problems with uncertainty
In this class no restrictions are made with respect to probabilities. But occasionally restrictions regarding values are specified through the way the problem is structured. Table 7 Frequency of the arguments in class III. Class
11.1.
Restriction
III.: Pi1 = 1 for all i 111.1.: U( Xllm) U( Xilm) for all m and all i # 1
111.2.
III.: Pi1 = 1 for all i
Specification
Rule
Agrees with SEU
FrequenCY
None
Dominance
Yes
13
Addition
Yes
13
No
4
>
111.1.: C U(Xllm) 5
U( Xilm
>
Zities
fOmraIli+l
111.3.
III.: Pi1 = 1 for all i
111.2.: Attribute 1 is the most important one 111.3.: U(X111) z U( Xill) foralli+l
Lexicogr.
W.E. Saris, I.N. Gallhofer / Foreign policy decision making
262
Restriction IV.1 .:
U(Xllm)>
LI(X12m)forallm,
and
CT(X12111)>U(Xijm)forallj,mandi#l. This restriction clearly identifies one “dominant” strategy Sl. This means that the Dominance rule can describe the choice and that this decision is in agreement with the SEU model. If specification IV.1. is given with respect to the probabilities: Specification IV.1 .:
Pll > Pi1 for all i # 1, where Oil is the most favorable outcome of strategy Si for all i # 1.
The decision to choose Sl can be prescribed on the basis of the full SEU model as intensities of both utilities and probabilities are given. In the case where no restrictions are made, a specification is given with regard to probabilities of outcomes under alternative strategies, this complex value problem is Table 8 Frequency of the arguments in class IV. ChSS
Restriction
Specification
Rule
Agrees with SEU
Frequen-
IV.1.
IV.l.: U(Xllm) z U(X12m) for all m and U(X12m) > U( Xijm ) for allj, m andi#l
None
Dominance
Yes
4
IV.2.
IV.l.: U(Xllm) U(X12m) for all m and U(Xl2m) U( Xijm) for all j, m and if1
IV.1.: Pll> Pi1 foralli#l where Oil is the most favorable outcome of strategy Si for all if1
SEU
Yes
1
IV.2.: Attribute 1 is the most important one None
Lexicogr.
No
2
None
No
3
IV.3.
None
>
>
cY
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
263
not easily solved. In this case the choice rule proposed, like the Lexicographic rule, will not necessarily prescribe a choice in agreement with the SEU model. The frequency of occurrence of the different structurings of class IV problem representations are indicated in table 8.
Discussion
Having described the different kinds of arguments which we found in our study, we shall now draw some conclusions. It would seem to us that most political decision problems need to be represented as complex value problems with uncertainty (see also George 1980; Gross-Stein and Tanter 1980). However, our data show little evidence for the representation of problems in this way in the arguments of the decision makers we studied. Class IV contains in fact the lowest number of cases, i.e. 10. The reason for this low frequency is obvious: without decision aids it is impossible to evaluate problems represented in this way, let alone convince somebody else of the correctness of one’s decision. Our analysis shows that the complex value problem is most often reduced to a simple value problem, allowing for uncertainty: class II contains 152 cases. But within this most populated class more than 50% of the cases are even further simplified by introducing more restrictions on the probabilities. Two types of restrictions were evident: one, where only one strategy is represented as having uncertain outcomes and the other, where one strategy has only one certain outcome. Furthermore, there are even 43 cases where all uncertainty is ignored and certainty of relations between strategies and outcomes is assumed (class I). A second interesting outcome of our study is that 171 out of the 235 proposed decisions are in agreement with the SEU model. This high degree of agreement stems however from the restrictions imposed on the decision situation. The SEU rule itself is hardly used in producing choice and the heuristic rules which are themselves implicitly proposed do not guarantee a decision in agreement with SEU in the general case, i.e. in the absence of restrictions on the way the problem may be structured. A third, remarkable result is that in all decisions which are in agreement with the SEU model, the probabilities of the outcomes under the various strategies are not of importance for the argument. For the
264
WE. Saris, I. N. Gallhofer / Foreign policy decision making
decisions in class I and III this is automatically true. In class II the “SEU decisions” are all decisions where the chosen strategy leads with certainty to an outcome, at least as good as that which any other strategy could optimally reach, while for the chosen strategy there is also a chance to obtain a better outcome. In the class II situations, probabilities which are specified have the function of strengthening
the
the
since they indicate that for the chosen strategy the most attractive outcome is also the most likely outcome and/or for the rejected strategies the less favorable outcomes are more likely. In all these situations the argument is clear, and, given the way the pattern is structured, correct without any doubt. In fact the decision makers always used an argument which states that the prescribed strategy will lead to outcomes which are certainly as good or better than the outcomes of any other strategy. It is clear that in such situations one can ignore uncertainty, apart particular outcomes since the argument will always hold. In the other 64 cases, where it is unclear whether the preferred choice is in agreement with the SEU model, the argument is less convincing, as it is apparent that some information is lacking within the problem representation. In class I such cases do not occur. In class 1I.A. and II.B., for 31 cases out of 86 the restriction that the chosen strategy certainly leads to better outcomes is not introduced. In these cases an explicit trade off has to be made between the various utilities and probabilities to ensure that the choice is in agreement with SEU, but this is not done. The decision makers’ choices still conform to simple rules, like the Risk-Avoiding-, the Reversed Simon- and Simon’s rule, which would only ensure agreement with SEU when employed in
argument,
conjunction restrictions, In class
with the restrictions mentioned above. In these cases, these which make the choice convincing, are not given. III
there
is sometimes
no simple
solution
because
of the
complex value structure. In 4 such cases the decision makers rely on a Lexicographic rule. This rule does not provide a particularly strong argument as its prescriptions can very easily be attracted on the basis of information with the pattern of representation. In general in class IV the problem representation is too complex for unaided apprehension and it does not even become clear sometimes how the decision makers arrived at their choice without imposing further restrictions on the way they represented the problem to themselves.
W. E. Saris, I. N. Gallhofer / Foreign policy decision making
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This overview suggests that the decision makers never depend on such a complex rule as SEU, but always use simpler rules. In the majority of cases such arguments are convincing, due to the restrictions introduced in the way the problem is structured, which bring the prescriptions made on the basis of these rules into SEU. But in some cases these restrictions are not introduced, and in these situations the decision makers we studied continue to use the same arguments (i.e. those characterized by the implicit use of Simon’s rule, the Reversed Simon rule and the Risk-Avoiding rule). Whether or not other decision makers in this type of situations do also in general accept these rules as a valid basis for determining their choices (rather than purposing and justifying them) is an open question, which requires further research. References Edwards, W., 1954. The theory of decision making. Psychological Bulletin 51, 380-417. Gallhofer, I.N., 1978. Coders’ reliability in the study of decision making concepts, replications in time and across topics. Methoden en Data Nieuwsbrief, Sociaal Wetenschappelijke Sectie van de Vereniging voor Statistiek, vol. 1 (februari). Gallhofer, I.N. and W.E. Saris, 1979a. Strategy choices of foreign policy decision makers: The Netherlands 1914. Journal of Conflict Resolution. (Since this edition contains several errors caused by printing a corrected reprint can be provided by the authors.) Gallhofer, I.N. and W.E. Saris, 1979b. The decision of the Dutch Council of Ministers and the Military Commander-in-Chief relating to the reduction of armed forces in the autumn of 1916. Acta Politica 1, 95-105. Gallhofer, I.N. and W.E. Saris, 1979~. An analysis of the argumentation of decision makers using decision trees. Quality and Quantity 13, 411-430. Gallhofer, I.N. and W.E. Saris, 1982. A decision theoretical analysis of decisions of the Dutch government with respect to Indonesia. Quality and Quantity 16, 313-344. Gallhofer, I.N. and W.E. Saris, 1985. ‘Explanation of the use of decision rules: a study of foreign policy decisions’. In: I.N. Gallhofer and W.E. Saris (eds.), Comparison of different content analysis procedures for decision making. (Forthcoming.) George, A.L., 1980. Presidential decision making in foreign policy. Boulder, CO: Westview Press. Gross-Stein, J. and R. Tamer, 1980. Rational decision making, Israel’s Security choices 1967. Columbus, OH: Ohio State University Press. Huber, O., 1982. Entscheiden als Problemlosen. Bern-Stuttgart-Wien: Verlag Hans Huber. Keeney, R.L. and H. Raiffa, 1976. Decisions with multiple objectives: preferences and value trade offs. New York: J. Wiley. Saris, W.E. and I.N. Gallhofer, 1984. A coding instrument for empirical research of political decision making. (Submitted for publication in the Spanish Revista de Sociologica.) Simon, H.A., 1957. ‘A behavioral model of rational choice’. In: Models of Man: social and rational, ch. 14. New York: J. Wiley. Svenson, O., 1979. Process descriptions of decision making. Organizational Behavior and Human Performance 23, 86-112. Vlek, Ch. and W.A. Wagenaar, 1979. ‘Judgement and decision under uncertainty’. In: J.A. Michon, E.G.J. Eijkman and L.F.W. de Klerk (eds.), Handbook of psychonomics, vol. II. Amsterdam: North-Holland.