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Simple Heuristics in a Complex World

Simple decision rules—often known as “heuristics” or “rules of thumb”—can be as accurate as, and sometimes more accurate than, complex strategies that rely on more information and elaborate computations (Gigerenzer, Hertwig, & Pachur, 2011). The insight that simplicity and accuracy are not mutually exclusive has introduced new questions into the debate on human rationality: In which environments can a heuristic outperform a complex decision-making strategy (e.g., a Bayesian model) and in which will it lag behind?

It is generally accepted that heuristics can succeed in simple, nonsocial environments—but not that they can also prove useful in complex social situations. Rather, it has been assumed that heuristics are doomed to fail in social worlds because their simple architecture is unequal to the task of predicting the behavior of interacting (and often competitive) agents. This environmental complexity, it is argued, calls for more complex strategies. Our approach (Hertwig, Hoffrage, & the ABC Research Group, 2013) offers an alternative view. The very complexity of social worlds—in which individuals compete and social goals (e.g., fairness vs. maximization) are often incompatible—is such that optimization strategies are either impossible or take more time or computational power than the decision maker can spare. This very complexity renders heuristics necessary. But heuristics cannot only substitute for complex strategies; they can also achieve goals that are relevant in many social environments and that are otherwise hard to attain (e.g., transparency, fairness, speed).

Let us take the example of parents with more than one child. How should they best distribute their limited resources in terms of, for instance, love, attention, and time? The classic (economic) answer is maximization. Theoretically, parents should invest more in those children they think will do better in life and be able to support them in their old age. Of course, parents cannot look into the future and calculate which of their children will provide the best return on investment. In this uncertain situation, many parents rely on a simple rule that is also in keeping with their sense of fairness: Divide your resources (e.g., your time) equally among your children. 

Intuitively, one would expect parents who follow this so-called 1/N rule to achieve an equitable distribution of resources between siblings. But that is not in fact the case. For example, middle children receive less of their parents’ time and attention than oldest or youngest children do (see Hertwig, Davis, & Sulloway, 2002). The inequality of the distribution increases with the number of children and the size of the age gap between them. Are parents fonder of their first- and last-born children than they are of the “sandwich child”—perhaps because the older child is more mature and the younger one cuter? There is no need to resort to such speculation on parents’ inner motives to explain the complex, inequitable distribution of resources. As the figure shows, application of the 1/N rule and its interaction with the conditions of the specific family environment (e.g., number of children, age gap between them) leads to systematic differences in patterns of distribution. The 1/N rule can lead to either an equal or an unequal distribution of resources (in families with two vs. three children). Middle children are at a relative disadvantage because they never have their parents to themselves. In contrast to the oldest and the youngest child, they always have to share their parents with at least one sister or brother. So parents may inadvertently produce inequality, even when they are doing their best to distribute their resources fairly. This analysis shows that simple heuristics can provide straightforward explanations of astonishingly complex and counterintuitive behaviors (see Hertwig et al., 2002).

Systematic differences in patterns of distribution
when the 1/N rule is applied

Systematic differences in patterns of distribution when the 1/N rule is applied
© MPI for Human Development

rEFERENCES

Hertwig, R., Hoffrage, U., & the ABC Research Group. (2013). Simple heuristics in a social world. New York: Oxford, UK: Oxford University Press.

Gigerenzer, G., Hertwig, R., & Pachur, T. (2011). Heuristics: The foundations of adaptive behavior. Oxford, UK: Oxford University Press.

Hertwig, R., Davis, J. N., & Sulloway, F. J. (2002). Parental investment: How an equity motive can produce inequality. Psychological Bulletin, 128, 728–745.

Reference

Hertwig, R., Hoffrage, U., & the ABC Research Group. (2013). Simple heuristics in a social world. New York: Oxford University Press.

Simple heuristics in a social world | Buchcover