Behavioral decision research is not a Linda problem: Comment on Regenwetter, Robinson, and Wang (in press)

Abstract

Regenwetter, Robinson, and Wang (in press) argue that research on decision making is plagued with conjunction fallacies or “Linda Effects”. As a case study, they provide a critical analysis of Kahneman and Tversky’s seminal paper on Prospect Theory and its 1992 sequel. This commentary evaluates their criticisms and ultimately finds them to be predicated on a number of misconceptions. As argued below, a reliance on stylized effects at the aggregate level is perfectly legitimate when dismissing a received view and first proposing a new account that organizes said effects in theoretically-meaningful ways.

Reply to commentaries: Why should we worry about scientific conjunction fallacies?

“…Misconstruing individual differences as error variance carries a cost and violates the definition of overfitting. We agree with Kellen (2022) that the literature is often vague enough not to state verbatum that CPT MED is more descriptive of behavior than CPT with free parameters, but scientific conjunction errors are not so limited in scope. Regenwetter et al (2022) intentionally glossed over potential limitations of studies, such as response errors, sample quality, reliability of measures, and diagnosticity of stimuli, to make a conceptual point.…”

“…Kellen concludes that "the complexity of the subject matter calls for careful historical, methodological, rhetorical, and conceptual considerations that go beyond what RRW currently have to offer." (Kellen, 2022) We concur. While our article, together with its companion article, attends to some historic components in the discussion of (C)PT and some other prominent articles, while we discuss some methodological and conceptual matters, much work remains to be done.…”

“…Kellen states that "stylized characteristics serve to show that some people's choices deviate from the received view, to a degree that cannot be ignored." (Kellen, 2022) We likewise argue that the striking difference between stylized characterizations (today's received view) and genuine heterogeneity should also not be ignored. Indeed, Kellen suggests that, perhaps, the widespread use of CPT MED as a way to represent Prospect Theory is merely "a habit or a desire to be consistent with past treatments."…”

“…Indeed, Kellen suggests that, perhaps, the widespread use of CPT MED as a way to represent Prospect Theory is merely "a habit or a desire to be consistent with past treatments." (Kellen, 2022) This may well be the case, and this was indeed a major motivation to take stock of that received view. We aim not to speculate about scholars' motivations, nor do we allege bad intentions.…”

“…Kellen is correct to remind us that "critical tests" challenge a "received view." (Kellen, 2022) Decades after Kahneman and Tversky (1979) and Tversky and Kahneman (1992), there can be little doubt that the conjunction of stylized properties has become the received view of many. Our article is a "critical test" of the logic behind such a received view.…”