Decision making is one of the basic cognitive processes of human behaviors by which a preferred option or a course of actions is chosen from among a set of alternatives based on certain criteria. Decision theories are widely applied in many disciplines encompassing cognitive informatics, computer science, management science, economics, sociology, psychology, political science, and statistics. A number of decision strategies have been proposed from different angles and application domains, such as the maximum expected utility and Bayesian method. However, there is still a lack of a fundamental and mathematical decision model and a rigorous cognitive process for decision making. This chapter presents a fundamental cognitive decision making process and its mathematical model, which is described as a sequence of Cartesian-product-based selections. A rigorous description of the decision process in Real-Time Process Algebra (RTPA) is provided. Real-world decisions are perceived as a repetitive application of the fundamental cognitive process. The result shows that all categories of decision strategies fit in the formally described decision process. The cognitive process of decision making may be applied in a wide range of decision-based systems, such as cognitive informatics, software agent systems, expert systems, and decision support systems.
TopIntroduction
Decision making is a process that chooses a preferred option or a course of actions from among a set of alternatives on the basis of given criteria or strategies (Wilson and Keil, 2001; Wang et al., 2004). Decision making is one of the 37 fundamental cognitive processes modeled in the Layered Reference Model of the Brain (LRMB) (Wang et al., 2004; Wang, 2007b). The study on decision making is interested in multiple disciplines, such as cognitive informatics, cognitive science, computer science, psychology, management science, decision science, economics, sociology, political science, and statistics (Wald, 1950; Berger, 1990; Pinel, 1997; Matlin, 1998; Payne and Wenger, 1998; Edwards and Fasolo, 2001; Hastie, 2001; Wilson and Keil, 2001; Wang et al., 2004). Each of those disciplines has emphasized on a special aspect of decision making. It is recognized that there is a need to seek an axiomatic and rigorous model of the cognitive decision-making process in the brain, which may be served as the foundation of various decision making theories.
Decision theories can be categorized into two paradigms: the descriptive and normative theories. The former is based on empirical observation and on experimental studies of choice behaviors; and the latter assumes a rational decision-maker who follows well-defined preferences that obey certain axioms of rational behaviors. Typical normative theories are the expected utility paradigm (Osborne and Rubinstein, 1994) and the Bayesian theory (Berger, 1990; Wald, 1950). W. Edwards developed a 19-step decision making process (Edwards and Fasolo, 2001) by integrating Bayesian and multi-attribute utility theories. W. Zachary and his colleagues (Zachary et al., 1982) perceived that there are three constituents in decision making known as the decision situation, the decision maker, and the decision process. Although the cognitive capacities of decision makers may be greatly varying, the core cognitive processes of the human brain share similar and recursive characteristics and mechanisms (Wang, 2003a; Wang and Gafurov, 2003; Wang and Wang, 2004; Wang et al., 2004).
This chapter adopts the philosophy of the axiom of choice (Lipschutz, 1967). The three essences for decision making recognized in this chapter are the decision goals, a set of alternative choices, and a set of selection criteria or strategies. According to this theory, decision makers are the engine or executive of a decision making process. If the three essences of decision making are defined, a decision making process may be rigorously carried out by either a human decision maker or by an intelligent system. This is a cognitive foundation for implementing expert systems and decision supporting systems (Ruhe, 2003; Ruhe and An, 2004; Wang et al., 2004; Wang, 2007a).
In this chapter, the cognitive foundations of decision theories and their mathematical models are explored. A rigorous description of decisions and decision making is presented. The cognitive process of decision making is explained, which is formally described by using Real-Time Process Algebra (RTPA). The complexity of decision making in real-world problems such as software release planning is studied, and the need for powerful decision support systems are discussed.