Psychological Review 2002, Vol. 109, No.

2, 358 375

Copyright 2002 by the American Psychological Association, Inc. 0033-295X/02/$5.00 DOI: 10.1037//0033-295X.109.2.358

False Memories of the Future: A Critique of the Applications of Probabilistic Reasoning to the Study of Cognitive Processes
Mihnea Moldoveanu
University of Toronto

Ellen Langer
Harvard University

The authors argue that the ways in which peoplescientists and laymen use probabilistic reasoning is predicated on a set of often questionable assumptions that are implicit and frequently go untested. They relate to the correspondence between the terms of a theory and the observations used to validate the theory and to the implicit understandings of intention and prior knowledge that arise between the conveyer and the receiver of information. The authors show several ways in which the use of probabilistic reasoning rests on a priori commitments to a partitioning of an outcome space and demonstrate that there are many more assumptions underlying the use of probabilistic reasoning than are usually acknowledged. They unfold these assumptions to show how several different interpretations of the same results in behavioral decision theory and cognitive psychology are equally well supported by the facts. They then propose a more comprehensive approach to mapping cognitive processes than those currently used, one that is based on the analysis of all of the relevant alternative interpretations presented in the article.

A man demonstrates his rationality not by a commitment to fixed ideas, stereotyped procedures, or immutable concepts, but by the manner in which, and the occasions on which, he changes those ideas, procedures and concepts. Stephen Toulmin Concepts, like individuals, have their histories, and are just as incapable of withstanding the ravages of time as are individuals. Sren Kierkegaard Senseand this one ought to knowis always the nonsense that one lets go. Odo Marquard We see others not as they are, but as we are. The Talmud

When social scientists study the ways in which people make decisions with yet-unknown consequences or judgments with incomplete information, they commonly invoke a normative calculus of belief in which statements can have subunitary truth values distributed between 0 and 1that are required to obey the laws of probability. The reasons for this requirement are only infrequently scrutinized. Social psychologists often describe human behavior in terms of its departure from behavior that is thought to be logically required by the application of the laws of probability to the information given to the decision maker. Many of the studies of individual choice under uncertainty carried out by Tversky and Kahneman (see, e.g., Kahneman, Slovic, & Tversky, 1982; Kah-

Mihnea Moldoveanu, Rotman School of Management, University of Toronto, Toronto, Ontario, Canada; Ellen Langer, Department of Psychology, Harvard University. We acknowledge the useful comments and suggestions of Raymond Nickerson and Klaus Fiedler on an earlier version of this article. Correspondence concerning this article should be addressed to Mihnea Moldoveanu, Rotman School of Management, University of Toronto, 105 St. George Street, #555, Toronto, Ontario M5S 3E6, Canada. E-mail: micamo@rotman.utoronto.ca 358

neman & Tversky, 1996; Tversky & Kahneman, 1980, 1982) in their influential work are based on the premise that such departures from the standards of correct inference that are based on the laws of probability can be accurately measured through the observation of behavior. Implicitly, they also assume that, given a problem statement, there are ascertainable and logically valid standards of reasoning from which these departures can be accurately and objectively measured. This assumption may be unfounded. Nickerson (1996) has pointed out that the use of the calculus of probabilities to arrive at degrees of certainty about various propositions rests on assumptions about the scenarios to which this reasoning is applied. He has instantiated these qualifications by reference to decision problems that are thought to have correct answers. Frequently, these assumptions are neither supplied as part of the problem statement nor are they self-evident. Rather, they must be constructed by each person faced with that particular decision problem. For example, if we estimate at 0.33 the probability that a familys two children are both boys on the basis of an observation of the childrens father holding one boy in his arms as he walks down the street and the information that he has another child, we are implicitly assuming that the two-child family in question is randomly drawn from the set of families in which there is at least one boy, which also implies the assumption that all fathers prefer walking with their sons over walking with their daughters, because otherwise, families with two sons are twice as likely to be represented as are families with one son and one daughter when the draw is random. In this article, we discuss ways in which the application of probabilistic reasoning depends on the prior assumptions we make about the phenomena whose outcomes we are trying to predict or infer. We show that the application of probabilistic reasoning relies on a commitment to an ontological framework that maps perceptions into representations or propositions. Such frameworks determine which events are identical and which are different and therefore allow an observer to conditionalize his predictions about

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the occurrence of an event on his observation of similar events in the past. The application of the calculus of probabilities for assigning measures to propositions about the world requires that descriptions of different events stand in a logical relationship of exclusion one to the other. Events themselves cannot stand in relationships of logical entailment or contradiction one to the other, only statements about events can (Sen, 1993). Moreover, events admit of many alternative representations, each of which generates a space of propositions whose degree of logical connectedness can be assigned probability figures. Different world views may contribute different sets of logically incompatible propositions that describe the same underlying event space. To use an example from Lakoff (1996), political conservatives and political liberals in the United States see each others positions on various social issues as mutually incompatible and therefore internally incoherent. Conservatives see a contradiction in the liberals support for womens rights to destroy their fetuses through abortion (which they see as an implicit endorsement for killing children) and the liberals support for child care and neonatal care programs (which they see as an attempt to nurture the lives of young children). How can liberals be permissive to the killing of children and committed to enhancing the survivability of children at the same time? Liberals see a contradiction in the conservatives position against the right to obtain an abortion (which they see as a commitment to saving lives) and the conservatives position against neonatal care programs (which they see as a retreat from that commitment). How can conservatives say that they want to save lives if they are against supporting lifesaving measures for newborns? Lakoff argues that the contradictions only appear when liberals represent conservatives positions through the lens of the dominant liberal metaphor (society as a family with the state as a nurturing mother figure), and conservatives represent liberals positions through the lens of the dominant conservative metaphor (society as a family with the state as a strict father figure). The contradictions disappear when the conservative position is represented through the lens of the conservative metaphor: Permitting free access to abortions is tantamount to encouraging the killing of children, and providing state funds for neonatal care represents an inducement to idleness on the part of the indigent mothers who benefit from the program. Thus, whereas liberals might treat the two propositions (prohibit abortions, cut funds for neonatal care) as mutually exclusive, conservatives might treat them as either logically independent or as logically connected. We examine several cases in which a narrow understanding of the application of the probability calculus to decision problems and judgments has led to conclusions about peoples cognitive processes that are too strong and sometimes unjustified. We show, for instance, how alternative correct interpretations of the same problem statement can lead to the patterns of responses that are judged to be incorrect by behavioral decision theorists, and how in some cases, alternative interpretations of the problem statement can lead to patterns of reasoning that are superior to the normative solutions that are advanced as correct in some situations. For example, in some cases, abandoning a probabilistic approach to modeling belief formation can lead to an increase in a persons de facto ability to predict or control the outcomes of a phenomenon. This is because the search for applicable causal models of a phenomenonwhich often requires seeing that particular phenom-

enon from many different perspectivesis often at odds with the careful construction of long-term statistics for a phenomenon, which must be founded on an invariant set of assumptions that establish the relevant reference classes. If, for instance, we model a coin toss by the instantiation of a discrete random variable with two possible values and unknown distribution, then, to form an opinion about the outcome of a particular coin toss, we should toss the coin a very large number of times in controlled conditions and construct the long-term statistics of the outcomes of these tosses. This tactic is predicated, however, on the assumption that coin tosses are independent and that the person tossing the coin has not gotten tired and listless by the 1000th toss and systematically modified something about the way in which the coin is tossed. One alternativewhich we explore belowis to construct a more realistic causal model of the workings of a chance device, incorporating the physical laws and properties that determine the dynamics of the device to arrive at a noisy but deterministic prediction of the outcome. We show that the accuracy of this prediction can be improved with improvements in the observers ability to estimate or control the parameters of his or her model, and therefore that it is not a priori unreasonable for a gambler to try to predict the outcomes of such devices on the basis of mental models of how they operate. Important questions about the appropriate use of epistemic norms in the interpretation of experiments that are aimed at exposing cognitive biases and fallacies have recently been put forth (Oaksford & Chater, 1994; Stanovich, 1999). The argument we make is different from both these and other critiques of the experimental findings that relate to the psychology of judgment (Birnbaum, 1983; MacDonald, 1986; Politzer & Noveck, 1991; Schwarz, 1998) and from the global critiques (e.g., Cohen, 1981) of the work of Tversky and Kahneman, (1980, 1982), which are usually aiming to exculpate lay rationality from the errors that it apparently commits relative to a normative calculus of belief. It is different from the former set of writings because, rather than critiquing a particular finding by offering an alternative explanation, we propose a framework for the investigation of epistemic rationality and competence that incorporates, as special cases, most of the more local critiques, while offering both new alternative interpretations of well-known experimental effects (see Discussion of Four Experimental Results in Modern Cognitive Psychology) and a map of the cognitive and metacognitive processes that may underlie the processes of judgment under uncertainty. It is different from the latter set of writings. We not only criticize the part of the work of Kahneman and Tversky (1980, 1982) that shows people fail to apply normative principles of reasoning with incomplete information and do not merely provide one alternative model of cognitive intuition aimed at explaining errors relative to a norm, but we aim also to show how and why people maysometimes rationally, sometimes not contravene these principles. We do so by showing how several different normative principles may be used to understand response patterns as either rational or irrational, depending on the framework that is used and the participants interpretation of the cognitive task at hand. We do not merely generate a list of possible alternative interpretations of erroneous response patterns, but aim to provide a framework for evaluating epistemic rationality that transcends the bounds of Bayesian reasoning, inductive inference, and the clas-

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sical confirmation rules and incorporates alternative epistemological commitments. We do not challenge the validity of the findings of Kahneman and Tversky and their followers: it is the case that experimental subjects in the studies we cite do not give answers that conform to both (a) the experimenters understanding of the problem statement and (b) the extensional logic of probability theory. The project that we undertake is to build up a cognitive and metacognitive map that explains how individual judgments can deviate (or sometimes seem to deviate) from logic of the probability calculus, because of cognitive, metacognitive, linguistic, or sociolinguistic effects and thereby to reveal the rich import that many areas of philosophy (linguistics, epistemology) and psychology (sociolinguistics and psychology of perception) have on research that deals with cognitive biases in judgments under uncertainty. Indeed, Tversky and Kahneman (1980) explicitly called for a dual analysis: a positive account that explains the choice of a particular erroneous response in terms of heuristics and a negative one that explains why the correct rule has not been found. Although we take exception with their naming the second project negative, which we would like to call reconstructive, our work is aimed at building a research program along the lines of the negative analysis that Kahneman and Tversky called for. A lot of the work that followed their original suggestions can be seen as (a) taking up the project of showing that people are cognitively incompetent relative to some (often implicit) model of competence; (b) reacting critically to (a), and (c) counterreacting critically to (b). We will seek, instead, to answer to the challenge of building explanatory accounts of cognitive processes and will show that a wealth of arguments and research from epistemology, the philosophy of language, and socio- and psycholinguistics are all useful and relevant to this project. The article is structured as follows. The first section (see What Probabilities Are and Are Not) introduces several different conceptions of probabilities and shows how the interpretation of a persons answer to a question as normative or counternormative depends on (a) the interpretation of a probability measure of the observer and (b) the interpretation of the probability measure that the observer imputes to the actor. Next, we review (see Assumptions Underlying Applications of Probabilistic Reasoning) the axioms of the probability calculus and the logic of Bayesian inference and discuss logically valid alternatives to a calculus of belief that is based on probabilities as well as logically valid objections to the normative calculus of belief that is based on probabilities. We show where the literature on the study of epistemic rationality has come up short in considering these viable alternatives as possible independent variables or sources of ambiguity in experimental studies of judgment under uncertainty. The next section (see A Framework for the Investigation of Cognitive Processes) builds a framework for explaining experimental findings about cognitive processes, using not only alternative logics of induction but also alternative epistemological commitments, alternative mappings between word and object, and alternative models of the interplay between social cognition and individual cognition. The framework is used to generate alternative explanations of wellknown findings in the literature on the study of cognitive intuitions that are based on alternative models of both cognitive and metacognitive processes underlying judgment under uncertainty.

What Probabilities Are and Are Not

The probability calculus has been called the logic of partial belief and inconclusive argument (Ramsey, 1931, p. 31). Because it is a branch of logic and not an empirical science, the calculus of probabilities can only generate analytical propositions, propositions that are true in virtue of the axioms of the calculus of probabilities (Ayer, 1960). It is a priori true, for instance, that the probabilities that a group of mutually exclusive, collectively exhaustive propositions about the world are individually true add up to one. There are at least three different conceptions of a probability measure that are used by scientists and philosophers (Ayer, 1960): (a) a priori probabilities are based on an evaluation of the total number of propositions that are possibly true of a particular scenario (i.e., the probability of the coin turning up heads is 0.5; mathematical probabilities). Probabilistic reasoning does not necessarily have to be inductive in nature, as pointed out in a recent paper (Johnson Laird, Girotto, Legrenzi, Legrenzi, & Caverni, 1999), but can be based on deductions from premises that include some of the evidentiary statements that can include or exclude certain possibilities. (b) Judgments about the frequency with which one of a number of possible sentences is true (i.e., the chance that the batter will get to first base against this pitcher is 0.333), or statistical probabilities, can be thought of as properties of ensembles of events of a particular type but may not be adequately thought of as properties of a single event. It is trivially true, for instance, that a coin that has been flipped five times and come up heads four of those times is characterized by a headstails ratio of 4:5; it is not evident that the probability that the coin will come up heads on the next toss is equal to 4:5 unless one makes additional assumptions about the underlying event space. (c) Judgments about the relative credibility of a particular proposition, in the absence of explicit models of the event space, statistical considerations (i.e., I am 90% certain that he will sign the contract this week), or credal probabilities, may not rely for their application to a particular case on a model that specifies the number of admissible possibilities, although they may rely on a causal model that seems to favor one particular possibility over another. For example, one may feel 90% sure of a basketball shot making the basket after watching part of the trajectory of the ball in slow motion (up to, but not including its contact with the basket), but may feel 50% sure that the ball will make the basket after watching only the beginning of the trajectory of the shot. If someones judgment is found to be an erroneous application of the laws of chance, we must impute that that person has used a particular conception of a probability to make sense of a scenario or predicament. When one says that a person commits a fallacy in thinking that an unbiased coin will be more likely to turn up heads after turning up tails seven times in a row, one is assuming that he is making his judgment on the basis of a model of the coin toss as an instantiation of a uniformly distributed binary random variable and is yielding to the temptation of believing that the coin will reverse its pathological trend sometime soon to make up for the sequence of tails. The probability theorist then explains to the person in question that the law of large numbers applies only to the limit as the number of tosses increases without bound and that no inference concerning future independent tosses can be correctly made from observing a short run of tosses. Alternatively, if the

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person says that the coin is more likely to turn up tails, one assumes that this is because the run of seven tails does not correspond to his or her intuition about a string of binary random variables; the probability theorist once again provides the same explanation. Suppose, however, that the person has based the estimate of a higher chance of tails on a fallibilist interpretation of the assumption that the coin is unbiased. That is, the person only provisionally accepts the hypothesis and looks for evidence and arguments that refute it. The hypothesis that the person is testing is not this is a fair coin, relative to which a run of seven tails is uninformative, but rather, the assumption of an unbiased coin is incorrect; the coin is biased, relative to which the run of seven tails is informative. Now suppose that the person is assuming that the experimenter is trying to be informative and then may think that the a priori conception of a probability is not the right one to use in this case: Some credal probability is called for that is based on a critical consideration of all of the information. Then, suppose that the person who has based the estimate of a higher chance of heads on the next toss on the basis of observing a correlation between the way in which the coin is tossed (e.g., which side is up, how many times it flips in the air) and the outcome of the coin toss. The coin may be unbiased, the person reasons, but the toss is not. Once again, the person is assigning a credal probability to the proposition that the next outcome will be heads, which is based on a different set of assumptions from those typically thought to be embodied in a problem statement about coins. Suppose, finally, that the experimenter reversed the problem and gave the person a list of past coin tosses (e.g., 1023) of the same coin in ideal conditions. The fraction of heads is found to be 5 1022, with an error of 1 in 100 million. Now the experimenter asks, What is the probability of heads on the next toss? and the person answers, 0.7, having observed that most of the tosses on the last, set of tries came up heads. Is the person wrong? Not necessarily. Even if the person has bought into the assumption that long-run average frequencies amount to probabilities, it is never clear a priori what probability can be inferred from the observation of a finite set of observations. Thus, the actual probability of heads may be 1/2 1/4 sin2 [n/(9 1022)] (Russell, 1940), and it is this probability that the coins sequence of tosses is revealing. There is no logically necessary relationship between the frequency of tosses observed in a finite string of experiments and the probability of a particular outcome occurring on the next toss.

and H A. A represents a finite subset of the universal set, made up of individual propositions. 2. Range of P. P(H) 0 for all H ; P() 0; P( ) 1; that is, the probability of the null space is 0, and the probability of the universal space is 1. 3. Independence. If Hi and Hj are logically independent for all M i and j, then P(H1 H2 H3 . . . HM) k 1 P(Hk); that is, the probability of the conjunction of a set of logically independent propositions is equal to the product of the individual probabilities of the propositions in question. If Hi and Hj are logically independent, then P(Hi Hj) P(Hi) P(Hj), where represents disjunction; that is, the probability of the proposition either Hi or Hj is equal to the sum of the probabilities of Hi and Hj if the two propositions are logically independent. 4. Monotonicity of P. If Hi 3 Hj, then P(Hi) P(Hj); that is, if one proposition entails another, then the probability of the former will be less than will be the probability of the latter. 5. Finite Subadditivity of P. P(Hi Hj) P(Hi) P(Hj); that is, probability of the conjunction of two propositions (logically independent or logically dependent) cannot exceed the sum of the probabilities of the propositions themselves. Let us examine the assumptions underlying our acceptance and application of the laws of the probability calculus to particular decision problems.

Bases for Accepting Probability Calculus as Normative

Proposition 1. Acceptance of the laws of the calculus of probabilities is based on prior assumptions and preferences. These are usually hidden and often unjustified.

Assumptions Underlying Applications of Probabilistic Reasoning

The three different accounts of probabilities have in common a calculus that the resulting probability measures must obey. Generally, we speak of particular propositions as making up the atomic elements of a sample space or a space of possibilities. This is consistent with the formulation of support theory (Rottenstreich & Tversky, 1997), which we discuss below. The propositions making up the sample space, which may be finite or infinite in number and M denoted by {Hk}k 1, are assigned probability measures on the interval [0, 1] that satisfy the following conditions: 1. Definition. A probability is defined by a function P : A 3 R on a sample space of all possibilities, {Hk}, such that A

Scientists that write about cognitive biases and fallacies assume that conditions (15) are normative and rarely stop to ask, Why should degrees of belief satisfy these conditions? Whereas the a priori interpretation of probabilities leads naturally to a probabilistic calculus as an extension of propositional logic, credal probabilities and frequency-based probabilities are not a priori constrained by their definitions. Once we come up with a reason for constraining degrees of belief to obey the calculus of probabilities (de Finetti, 1937), we realize that our acceptance of these rules must rest on some unverified assumptions. In particular, de Finetti showed that, if a persons degrees of belief about a set of hypotheses do not conform to the probability calculus, then someone can construct a Dutch book against that person, that is, can extract a positive gain from that person with probability 1 by offering the person a set of bets on various subsets of hypotheses (see Resnik, 1987, for a pedagogical exposition of the Dutch book argument). Whether this is a good reason for accepting the probability calculus as normative must depend on how likely we think it is that someone can construct such a series of bets against us. If we think this eventuality to have a negligible likelihood, then clearly we do not have a compelling reason for adopting the calculus of probabilities as normative.

Further Challenges: Justificationism Versus Fallibilism

A justificationist will seek reasons for accepting a particular proposition and will choose among competing alternatives the proposition for which there is the mostsupport (Albert, 1985;

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Lakatos, 1970). Someone who adopts the probability calculus as normative is a justificationist who seeks to differentiate among different propositions on the basis of the relative level of support (or justification) that these propositions receive from evidence statements. On the other hand, a fallibilist seeks reasons against a proposition (Popper, 1992) and seeks to falsify a proposition by looking for evidence that disconfirms that proposition. Only when such evidence has not been found, despite the persons best efforts aimed at producing it, is the proposition in question deemed corroborated and accepted as provisionally true. Fallibilists argue that the prior probability of any law-like universal generalization is 0, as follows: If L is a general law and ei, 1 i n are individual instantiations of L, then, P(L) limn3 P(e1, e2, . . . , en), because L entails an infinite number of instantiations of ei (because it is universal). If ei is independent of ej for any i and j, then P(e1, e2, . . . , en) P(e1) P(e2) . . . P(en) by the independence axiom. If the probability measure P() is regular, then P(ei) 1 for any i. Finally, if the sequence of ... instantiations {ei} is exchangeable, then P(ei) P(ej) P(en). Now, the conditions of independence, regularity, and exchangeability, taken together imply that lim n3 P(e1, e2, , en) limn3 P(e1) lim n3 [P(e1)]n P(e2) 0 P(en)

That the link between word and the object it represents is tenuous can also be deduced from the collapse of the analytic-synthetic distinction argued in Quine (1960) and from Wittgensteinian considerations about the ambiguity that is inherent in establishing the meaning of a word by pointing at the object or event to which that word refers (Barnes, Bloor, & Henry, 1996), which cannot be eliminated by a concatenation of acts of pointing on recursively finer space-time scales. Let us examine how the nonuniqueness of representation plays out in our attempts to update our degrees of belief on account of new information. The normative solution here is provided by Bayess theorem, which states that if D is a new piece of (propositional) information that is relevant to the truth of various propositions {Hk}, then, when learning it is the case that D, we should update the probability of any one hypothesis by the formula P(HiD) P(DHi)P(Hi)
M j 1

(1)

P(DHj)P(Hj)

and, together with the condition that P(L) limn3 P(e1, e2, . . . , en), that P(L) 0. Now, any hypothesis such as here is a glass of water, will contain universal terms such as glass and water and therefore will qualify as a universal statement of the kind Popper (1992) has in mind. Therefore, those who are fallibilist can reasonably decline to invest their beliefs with measures that satisfy the probability calculus.

The Dependence of Judgments About Competence on Judgments About Representations

Proposition 2. Objects and events collections of sense data do not of themselves imply their own representations. There are many different representations of a particular collection of sense data, and only in the context of these representations does it make sense to speak of an application of the logic of partial belief.

where D stands for an observation statement (datum), Hi stands for the hypothesis for which corroboration is sought, and Hj are all of the relevant hypotheses that D could corroborate. At least two conditions must hold for the application of Equation (1) to be justified. First, for D to discriminate between two or more competing hypotheses, the hypotheses in question must logically exclude one another: They must be mutually exclusive vis-a-vis D, in the sense that D cannot lend equal support to two or ` more hypotheses. D must discriminate among the different {Hj}. Call this the discriminant condition. Second, the set of hypotheses {Hj} must be exhaustive of all conceivable explanations. Call this the completeness condition. Now let us critically examine these two conditions. Counterexample to the discriminant condition. Consider, first, a counterexample to the discriminant condition: When only two hypotheses are considered (H0 H, H1 H), an investigator will be called on to accept or reject H on the basis of some observationstatement D. He will calculate the probability that the null hypothesis is true by, P(H0D) P(DH0)P(H0) P(DH0)P(H0) P(DH1)P(H1) (2)

As Wittgenstein (1953) pointed out, there is no unique and self-evidently correct way to represent or propositionalize a particular perception. In fact, Anderson (1978) proved a theorem to the extent that there exist multiple equivalent theories that specify internal representations of objects and events that make the same behavioral (thus empirically testable) predictions. To the point of our critique, it is always possible to come up with an alternative theory of internal processes by which people form judgments, which predicts the same observed behavior as that recorded in experimental tests of cognitive competence, but which supplies a very different interpretation for the same experimental results than that adduced by the experimental researchers. Inferences from such studies thus may reflect as much about the researchers own hidden (and thus untested) assumptions as about the subjects internal processes of forming judgments about empirical matters.

and the probability that the null hypothesis is false is calculated by P(H1D) P(DH1)P(H1) P(DH1)P(H1) P(DH1)P(H1) . (3)

When we apply Equations 2 and 3 to calculate a degree of belief, which a hypothesis H1 commands on the basis of an observation statement that we hold to be true, we implicitly answer the parallel questions When can we say that an observation provides an instantiation of H1? and Which hypothesis is instantiated by an observation? If we could show, for example, that an observation statement could provide support for two mutually contradictory statements then we also could show that the result obtained by applying Bayess theorem to a set of data will only have value or make sense relative to one of several possible views of the world:

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There are at least some hypotheses that we cannot use the theorem to adjudicate among. Goodman (1954) has given just such an example. He considers the proposition, All emeralds are green, which is corroborated by This emerald is green. Next, he constructs the predicate grue to describe an object observed before time t and found to be green or observed after time t and found to be blue, where t lies in the future. The proposition, All emeralds are grue is also corroborated by the discovery of a green emerald before time t, but has the consequence that it predicts the emerald will be blue after time t and contradicts All emeralds are green. It is the function of inductive reasoning to come up with well-supported statements about unobserved or not-yetobserved events, but Goodmans example implies that the product of induction is contingent on the predicates that we use to describe the world. Because these predicates emerge from a particular world view, the outcome of the process of induction is similarly world-view dependent. One could object that there is something pathological about the word grue, because it is the product of a transformation of the predicate green, which induces a dependence of the predicate on time. However, trying to bring this objection to someone who speaks grue bleen language will likely bring the retort that blue green are illegitimate transformations of grue and bleen: Something is green just in case it has been observed before t and found to be grue and also observed after t and found to be bleen. The problem relating to the indeterminacy of inductive inference can be detected in the literature on personality testing and categorization (Edwards, Morrison, & Weissman, 1993) using standardized scales such as the Minnesota Multiphasic Personality Inventory (MMPI) and in the categorization of mental illness according to the Diagnostic and Statistical Manual of Mental Disorders (4th ed.; American Psychiatric Association, 1994). In its original use, the MMPI was used as a diagnostic tool (i.e., a person who was expected to be depressed was also expected to score highly on the Depressed axis of the test). Subsequent applications of the MMPI have evolved away from diagnostic applications toward profiling or configural applications, whereby the entire pattern of responses is used to produce a profile of the individual taking the test (Butler & Satz, 1995). Like grue, depressed is not an easily projectible predicate. (It receives corroboration from observations that correspond not only to typically depressed behavior, but also to social introversion, psychastenia, and hypochondriasis.) Thus, any particular observation of a behavior (or an answer to the questionnaire) can be seen as supporting a characterization of the person as depressed or, as, psychastenic, just like the observation of a green emerald in the example above can support the hypothesis that emeralds are green just as well as it can support the hypothesis that emeralds are grue. Counterexample to the completeness condition. Second, consider a counterexample to the completeness condition (Jeffrey, 1965). You are called on to lay a bet on a coin that you have seen flipped a trillion times. Most of the tosses 89% of them have yielded outcomes of heads, which, strangely, have occurred on all and only those toss numbers that are composite. The next toss is prime numbered. How would you bet?

If your hypothesis is The coin is biased towards heads and your alternative hypothesis is The coin is fair, then the data seem to support the main hypothesis, as long as you also believe in the law of large numbers. If your hypothesis is, The coin comes up tails on prime-numbered tosses, then the data also support it resoundingly. A Bayesian would advise us to look at the priors on the two possible partitionings of the hypothesis space. The space of functions supported on the number of observed tosses is infinite; therefore, the prior probability should be very nearly zero, and the probability that the pattern will continue into the future will also be nearly zero. By contrast, the prior on the fair coin assumption is 0.5the coin is either fair or not. Thus, choosing a particular kind of hypothesis also determines the space of possible hypotheses and the prior probabilities in a Bayesian experiment. The data as a whole, however, cannot be made relevant to both kinds of hypotheses simultaneously: Choosing one kind of data (correspondence between outcome and primality of toss number) commits a person to a particular kind of hypothesis (concerning the type of pattern that is instantiated by the sequence as a whole).

Why Support Theory Does Not Go Far Enough

The support theory elaborated by Tversky and Koehler (1994; see also Rottenstreich & Tversky, 1997, for a succinct summary of the theory) can be seen as a direct response to concerns such as those embodied in Proposition 2. Support theory distinguishes between events and representations of events and admits that the same events can have more than one representation. It attempts to give a reconstructed logic of judgment under uncertainty that predicts the deviations of peoples answers from the normative logic of belief. Support theory links particular observed violations of the extensional logic of the probability calculus to the underlying syntax and semantics of the propositions that make up the sample space. Implicit propositions, for example, are assigned probability measures that are smaller than their explicit versions. The theory can best be described as a cognitive framework for applying the probability calculus to particular kinds of propositional sample spaces. It is not, however, a cognitive road map for understanding deviations from the logic of the probability calculus on the basis of alternative (nonprobabilistic) approaches to forming judgments. There are, then, critical aspects of tests of cognitive process and competence that support theory does not address and can be deduced from our analysis. First, it does not address the fact that there are many different ways of combining elementary propositions to form testable hypotheses (i.e., different logics of scientific discovery or epistemological commitments). Inductive inference may or may not be the model of choice for most subjects, and epistemological commitment should be considered as a relevant alternative explanation for response patterns that are considered erroneous from the standpoint of an inductivist approach. Second, it does not fully address the degrees of freedom one has in interpreting a particular event (or a particular interpretation of an event). Even though it recognizes that representations and interpretations matter to behavior, it does not allow that we can come to see a particular object as the instantiationof a particular repre-

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sentation as a result of being exposed to that representation. This assumption needs to be tested. And at least one superficial experiment in visual perception suggests that it is false. A collection of marks on a piece of paper that appears to have been randomly generated at first sight (Rock, 1984, p. 57) is immediately seen as a man sitting on a bench when some cue (man sitting or bench scene) is supplied that guides the attention of the observer to the salient features of the image. Although the apparently random collection of marks cannot be used to discriminate between the hypotheses he is sitting and he is standing, the apparently random collection in conjunction with the cue can provide the requisite discrimination. Observation is not a theoryindependent process. Theory-dependent cues can color perception and shape the process by which pure sensory impression is translated into linguistic expression, that is, into an observation statement. Although it recognizes the difference between language and experience, support theory, in its current form, neither shows how language and perception interact nor does it explicitly work through the effects of different representations of the same decision predicament on the choices or judgments that a person might make.

Language Dependence of Judgments About Cognitive Rationality

Proposition 3. Objects and events cannot of themselves stand in logical relations vis-a-vis each other, only statements about objects ` and events can do so. The application of probabilistic reasoning to a particular situation or problem must rest on an ontological framework of object names, person names, event names, and relation names that can be used to construct propositions whose truth value can be measured relative to some data. Therefore, the end product of a probabilistic reasoning process will depend on the ontological framework used to interpret, understand, or represent the world.

or object, hence multiple possible propositionalizations of a particular event or object. This state of affairs can lead to a situation in which the occurrence or nonoccurrence of an event depends on the language that is used to describe the event. Hence, understanding events as standing in a logical relation to one another can be understood as an illusion arising from the idea that the link between a proposition and an event is unique and objective, rather than nonunique and contingent. Indeed, the contingency of the process of labeling events by using words is the critical insight behind Quines critique (1960) of the Kantian distinction between analytic statements (statements that are true in virtue of their definitional meaning) and synthetic statements (statements whose truth is contingent on some state of the world): One can always imagine a world in which the meaning of some word that is found in an analytic statement is such that it makes the statement false. When we consider sentences that describe different events, we can see that the events that are meant to be described by the propositions p and q, such as He went to the theater at time t and He had a cup of tea at time t, cannot stand in a relationship of logical contradiction to each other, except relative to a background system of assumptions that states that one cannot do both at the same time. Therefore, the two events that are denoted by going to the theater or having a cup of tea are mutually exclusive only relative to a true a priori model, which says that the person in question cannot carry out both tasks at the same time without contradicting the premises or predictions of the model.

Why Previous Critiques Need to Be Amplified

Dawes (1988) has discussed the problem of language dependence in probability judgments (p. 80), but he advocates using Venn diagram representations of sample spaces on which probability measures are defined as a sort of alternative to thinking in words. Unfortunately, the elements of the sets that are represented by Venn diagrams must themselves be individuated in language. If these elements are events, then they can be individuated as changes in the property of a substance at a time (Kim, 1976). The identity of a substance or of a property, however, depends on the causal powers of that substance or property, according to at least one approach to individuation (Shoemaker, 1980); and talking of causal powers gets us back to talking about cause-and-effect relationships. Relying on Venn diagrams does not allow us to escape the problem of language dependence. In the absence of a rule for representing events and objects and for declaring two events to be identical regardless of changes in perspective or language used for description, we cannot claim a noncontingent or theory-free status for statements about sequences of events. Such statements are contingent on the representations we choose for these events and, surely, on the strategy that we use for individuating events. It is very much the business of individuals who care about predicting the future to improve not only their skill in applying the axioms of probability to given representations, but also their craft in picking out representations of objects and events that yield better predictions. We show here that many of the results of behavioral decision theory that seem damning to the predictive prowess of the man on the street can in fact be interpreted as sophisticated applications of just this type of reasoning.

Once we have identified an event by a proposition or a name, p, then we can begin to refer to that event by its name. The statement that asserts the occurrence of the event will stand in logical contradiction to the statement that actively denies the occurrence of the event and in a nondeterminate logical relation to its passive negation. However, the mere occurrence of the event cannot stand in a logical relation to the nonoccurrence of the event. The language that we use to describe events plays a trick on us because it does not explicitly signal that words are merely placeholders for things; it therefore gives the impression that there exists a necessary connection between events because there is a necessary connection between the propositions that describe them. We sometimes take it as evident that if any relationships exist between event names, they will also exist between the events to which the names refer. This is precisely where Andersons (1978) result becomes relevant. Because even lay language contains at least some theorydependent terms (see Kuhn, 1970, who argued that there is no theory-independent observation language), propositionalization or the application of lay language to a practical contextrests on the application of a theory about the object or event that is propositionalized. Andersons result states that there are multiple possible theories that can correspond to the same observable event

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Effect of Assumptions About Event Sequence on the Construction of the Reference Class
Proposition 4. The application of a statistical interpretation of a probability to the formation of a degree of belief about a future state of the world rests on assumptions about the underlying properties of the sequence of events to which the statistical description refers.

tician, or a Neyman-Pearson statistician (Gigerenzer et al., 1989) rest on a set of assumptions about the ways in which minds construe the problems that are meant to test for the relevant cognitive processes. In the next section, we will give several examples of alternative explanations of experimental results from cognitive psychology that are aimed at determining whether peoples reasoning processes conform to the accepted methodological standards of empirical scientists.

The empirically observed frequency of a particular event type can only be equated to the probability of the occurrence of that event in the limit as the number of observations increases without bound if the sequence of events in question has the property of exchangeability (see Kreps, 1988, pp. 154, 158). The concept of exchangeability is most easily explained for a two-outcome chance device such as an unbiased coin. If a sequence of outcomes is exchangeable, then the joint probability of any set of M outcomes {l1, . . . , lM} of tosses is equal to the joint probability of any other of the M! permutations of the M outcomes, that is, P(heads, tails, heads) P(tails,heads, heads) . (4)

A Framework for the Investigation of Cognitive Processes

We have thus far established the dependence of conclusions about peoples reasoning process on assumptions that we make about their personal epistemologies, their subjective representation of an event space, and the assumptions that they make about the underlying sample space. Figure 1 summarizes these dependencies in the form of a sequence of questions that an investigation of cognitive processes involved in prediction, judgment, or explanation should attempt to answer. 1. First, what is the epistemological approach that a person uses? To fallibilists, a question about relative likelihood may be meaningless, and therefore his/her answer will not illuminate the way she thinks about problems that are supposed to illustrate her failure to be a good justificationist. 2. Second, if the person is a justificationist, what approach does he/she take to the representation of beliefs? Do probability measures capture all of the relevant information about a particular context? In the absence of a conclusive argument one way or another, this question remains open, and debate in epistemology should inform arguments and experimental inquiries in psychology, and vice-versa. 3. Third, for a probabilist, how does the person update his or her subjective probabilities in light of new information? Is he/she a Bayesian? What is the class of allowable update rules for Bayesian probability measures? How are ambiguities about the assignment of prior probabilities resolved? Once again, epistemological discussion and cognitive inquiry can inform each other to mutual advantage. 4. Fourth, how does the person represent the decision, judgment scenario? What are the relevant objects that make up the problem statement as he/she sees it? What are the metaphors that structure the way in which he/she relates to the problem? What is the relationship between his/her intuitive use of natural language connectives (and, or) and the use of these connectives in formal logic (of which probability theory is a variant)? Here, research from socio- and psycholinguistics, from the philosophy of language, and from analytic philosophy can very usefully complement the cognitive study of epistemic rationality. 5. Fifth, what does the interactive epistemology of the situation look like? What are the persons beliefs about the purpose, scope, aim, goal of the experimenter, or the experimental design? What are the persons beliefs about the experimenters beliefs? about the experimenters beliefs about his/her beliefs? and so forth. What is the relevant depth of interactive epistemology in the situation at hand? Here, research from social psychology, game theory, and anthropology can give us important insights into the study of individual cognitive processes, which may turn out to be success-

de Finettis (1937) exchangeability theorem shows that two people that start out with different subjective probability estimates for a particular outcome in an exchangeable sequence will converge to the same estimate as the number of observations of the events in the sequence increases without bound. Judgments of exchangeability therefore determine when we can adequately think about the frequency of events in a particular class as the probability of the occurrence of an event of that class. However, judgments about the exchangeability of events in a sequence depend on our representation of the events that make up that sequence. For example, the sequence of events (taking off my shoes, putting on a night shirt, climbing into bed) is not exchangeable because the joint probability of the sequence (climbing into bed, taking off my shoes, putting on a night shirt) will not be equal to that of the sequence (taking off my shoes, putting on a night shirt, climbing into bed). On the other hand, one may be tempted to see the sequence (pronating my hand, supinating my hand, pronating my hand) as exchangeable. This sequence, however, may just be another representation of the sequence (taking off my shoes, putting on a night shirt, climbing into bed) being made up of propositions that are true given that the propositions in the original sequence are true, because hand movements are associated with various body movements. Judgments about exchangeability of a sequence of events, therefore, seem to depend on the representation of the sequence about which we are making the judgments of exchangeability. The application of probabilistic reasoning to everyday sequences of events will depend on the ways in which we choose to represent those events. These descriptions are not in any way implied by our unpropositionalized, sensory experiences of those events, but rather are created by our minds. This line of reasoning suggests that questions about whether the mind is an analyses of variance (ANOVA) statistician, a Bayesian statis-

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Figure 1.

Epistemological map for tracking cognitive processes through forced-choice experiments.

ful adaptations to interpersonal situations whose complexity far outweighs the complexity of the technological predicament that individual cognition is supposed to have evolved to master (see Bogdan, 1999).

Discussion of Four Experimental Results in Modern Cognitive Psychology

We now apply our analysis of the assumptions that are embedded in the application of probabilistic reasoning to decision and judgment problems to experimental results that purport to reveal deficiencies in man-on-the-street reasoning processes, relative to commonly accepted standards of inference. Our analysis shows that several alternative interpretations of these experimental results are possible, and at least some of them are plausible explanations for the recorded response patterns that are usually thought to exemplify fallacious reasoning.

The Conjunction Fallacy

Tversky and Kahneman (1982) gave participants in an experiment the task to rank, in order of truth, values or personal degrees of credibility, different statements that could be true of a person of whom it is also true that she is 31 years old, single, outspoken, and very bright. She majored in philosophy. As a student, she was deeply concerned with issues of discrimination and social justice and also participated in antinuclear demonstrations. The statements ranged from she is a bank teller to

she is a bank teller who is active in the feminist movement, to she is a psychiatric social worker. Respondents regularly assigned higher truth values to the compound statement she is a bank teller who is active in the feminist movement than to the simple statement she is a bank teller. The authors used these response patterns to infer that respondents reasoning process seemed to violate the laws of probability, which require that, if A logically implies B, then P(A) P(B). They write, like it or not, B cannot be more probable than A and B, and a belief to the contrary is fallacious. Our problem is to retain what is useful and valid in intuitive judgments, while correcting the errors and biases to which it is prone (p. 178). Below, we provide several alternative explanations of the effect, based on different (but plausible) interpretations of the experimental task. All of them challenge the authors conclusion about an error in the reasoning processes that is used by respondents, but do so on different grounds, and point to different directions of empirical research in which the reconstructive program of Tversky and Kahneman (1980) can be pursued. A Bayesian interpretation. The situation on which the participants were invited to opine had either been instantiated or not. To wit, the statement, Linda is a bank teller who is active in the feminist movement is either overall true or overall false. There is little valuein real settingsin getting one half of the sentence right: Unlike graders of college exams or papers, Nature does not give partial credit. Therefore, either one accepts she is a bank teller and she is active in the feminist movement as an entire

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sentence, or one rejects it as an entire sentence. The conjunction and, as it appears in this sentence is, in this case, not construed as an invitation to form the intersection of the two sets, bank tellers and people who are active in the feminist movement, but rather as one of logical connectedness between two propositions. There is, then, a reasonable interpretation of the laws of probability that explains the choices that participants in the Tversky and Kahneman experiment made. Participants chose rationally (according to the rules of inductive logic that the application of Bayes Theorem rests on) if they actually chose among statements describing possible worlds, rather than among single statements describing a single world. Each possible world has the property that statements about it are globally true or globally false, their complexity notwithstanding. We may not have enough information to determine whether these statements are true; however, they can never be partially true or probably true when that information has been gathered: They are either true or false. On this interpretation, the participants in the experiment sought inductive support for various statements about Linda that could have been true from among the statements about Linda that are known to be true. To the extent that stereotypical images have and give inductive supportwhich was not the purpose of the experiment to challengethe description of Linda as an outspoken liberal arts major lends the greatest inductive support to the statement about Linda that refers to her extracurricular involvements in the feminist movement. Thus, letting H1 denote the hypothesis Linda is a bank teller who is active in the feminist movement, H0 denote the hypothesis Linda is not a bank teller who is active in the feminist movement, and D denote the description of Linda, we have, by the application of Bayes Theorem, that P(H0D) P(DH0)P(H0) P(DH0)P(H0) P(DH1)P(H1) 1 P(H0D) P(H1D), (5)

if P(DH1) P(DH0), that is, if the stereotype of an outspoken female philosophy major as a feminist activist has any evidentiary support. Therefore, the probability that H0 is true will be less than the probability that H0 is false, and H1 will be accepted by a reasonable inductivist, such as a Bayesian. Now, let H1 denote the hypothesis Linda is a bank teller, H0 denote the hypothesis Linda is not a bank teller, and D denote the description of Linda given to the participants. In the absence of some inductively supported stereotype of bank tellers, we have P(H0D) P(DH0)P(H0) P(DH0)P(H0) P(DH1)P(H1) 1 P(H0D) P(H1D), (6)

that is, H0 will be supported to the same extent as will H1. In this case, there is no inductive justification for choosing Linda is a bank teller over Linda is not a bank teller given D, the description of Linda. Thus, a straightforward application of inductivist logic leads one to choose correctlythe statement Linda is a bank teller who is active in the feminist movement as more likely to be true than is the statement Linda is a bank teller. A Popperian interpretation. Popper (1992) has argued for an approach to scientific knowledge in which there is no inductive

support for a statement. Taking as a point of departure Humes argument that there is no logical basis for induction, Popper argues that scientists should (a) seek information that could falsify their theories rather than verify them and (b) choose from among competing theories, those that have the greatest empirical content, have received the most severe empirical tests, and have most successfully passed them. If a theory is formed by the conjunction of two falsifiable propositions, a and b, then it will have greater empirical content than a theory that comprises a alone (Popper, 1992). Moreover, if one of a and b has been tested against some observation-statement d, then the theory made up of a and b will be preferable to a theory made up of two untested empirical propositions, c and d. The consequence of this argument is that one is usually advised to choose, as most likely to be true, the a priori least likely proposition that has survived empirical testing because a priori the empirical content of a and b will be greater than will the empirical content of a or b alone, whereas the a priori probability of a and b will be less than or equal to the probability of either a alone or b alone. This negation of probabilism is consistent with Poppers insistence that the prior probabilities of lawlike universal generalizations is zero (Gemes, 1997). Let a represent Linda is a bank teller and b represent Linda is active in the feminist movement. By a falsificationist account of participants reasoning, the conjunction a and b will be chosen over a because it has greater empirical content, and b has already been tested against D, the description of Linda, than against the proposition a alone. This interpretation of cognitive processes underlying the Linda experiment has even more dramatic implications than does the former: The intuitive scientist, so much maligned in socio-psychological studies of inference (Gilovich, 1991; Nisbett & Ross, 1980), may be more of a scientist by the Popperian account of science than are the scientists that administer the tests of scientific competence (for a discussion of failures of the critical spirit of inquiry among psychologists, see Greenwald, Leippe, Pratkanis, & Baumgardner, 1986). A psycholinguistic interpretation. We usually assume that participants parse the statement Linda is a bank teller who is active in the feminist movement as a straight conjunction of the two propositions, Linda is a bank teller and Linda is active in the feminist movement. In first-order logic, the conjunction a and b is identical to the conjunction b and a. In natural language, however, this is hardly the case; indeed, asymmetry of conjunctive sentences is singled out by Dawes (1988) as the reason why we should be cautious of applying probability measures to languagedependent representations. I bought a machine gun and went to the market is not (usually) understood to be identical to I went to the market and bought a machine gun. In language, conjunction is asymmetric. Moreover, the fact of a conjunction may change our interpretation of the terms in the conjunction. I bought a machine gun, in the first case (wherein it appears that I bought it to murder people at the market) is different from I bought a machine gun in the second case (wherein my intention is not apparent). When we say, Linda is a bank teller, we understand her to currently do the work of bank tellers. She is, therefore, part of the set of currently active bank tellers. When we say, however, Linda is a bank teller who is active in the feminist movement, we may infer that she was trained as a bank teller or that she once worked

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as a bank teller, in addition to the possibility that she is currently doing the work of a bank teller. Thus, the set {bank tellers1} may be a proper subset of the set {bank tellers2}, in which case, saying that P (Linda {bank tellers1}) P (Linda {bank tellers2} and Linda feminist group) may not be fallacious. In this interpretation, the experiment reveals that people may not use the rules of first-order logic to parse natural language sentences, which is hardly a surprise to cognitive linguists, who have figured out that logical form and grammatical structure are different (Hacking, 1984). An interpersonal interpretation. Grice (1975) proposed that conversations between people cannot be understood simply by reference to the transcript of their conversation and to a dictionary or thesaurus that translates words and phrases and parses grammatical structures. Rather, the meaning that one gives to a phrase uttered in a conversation depends on ones assumptions about the intentions of the person uttering the sentence, which are themselves related in many ways to the immediate context of the sentence. Grice proposed that people assume each other to be cooperative and therefore try to interpret each others words to make them informative and relevant to a particular topic. If one assumes that the laws of probability are a priori dispositive of the choice between the statements Linda is a bank teller and Linda is a bank teller who is active in the feminist movement as to their relative likelihood, then one must infer that the description of Linda in the experimental materials is irrelevant. But this contradicts Grices (1975) cooperation principle. To find it relevant, participants must find an interpretation of the problem that allows them to consider all of the information given by the experimenter as relevant and informative. Choosing Linda is a bank teller who is active in the feminist movement as more likely to be true than is Linda is a bank teller is no more than a signal that participants were trying to solve an interpersonal problem vis-a-vis the experimenter, rather than the first-order problem that ` they were apparently resolving. The work of Schwarz and his coworkers (Schwarz, 1998; Schwarz & Bless, 1992; Schwarz, Strack, & Mai, 1991) and the review of the subject by Hilton (1995) posit an explanation for representativeness-based judgments that is similar to the Gricean logic in the emphasis on the information impacted to a person making a judgment by the context of the conversation in which that judgment is asked for. The representativeness heuristic (Tversky & Kahneman, 1982) relates to the propensity of people to make judgments about the likelihood of the validity of a universal proposition (My life is going well) on the basis of statements about particular circumstances that are deemed to be representative of the reference class of the universal proposition (My marriage is going well). In the experiment run by Schwarz, Strack, and Mai, people from one group were first asked how satisfied they were with their life in general and then asked how satisfied they were with their marital situation. The researchers found a correlation coefficient of .32 between the (coded) answers to the two questions. In a second group, the order of the questions was reversed, and the correlation coefficient increased to .67. Schwarz (1998) offers a cognitive explanation for the effect: Presumably, answering the marital satisfaction question first rendered information about ones marriage highly accessible and this, rather than other, information, was subsequently used in evaluating ones life as a whole (p. 96). In the Linda example, what is prima

facie accessible is the congruence between the description of Linda and the suggestion that she is active in the feminist movement; and by the explanation offered by Schwarz, it is the accessibility of some decision rule, rather than the presumed intent of the speaker, that accounts for the conjunction bias. A more detailed account of such congruence effect is examined in the next section.

An Interpretation Based on Intuitive Probabilities

Cohen (1977, 1979, 1981; MacDonald, 1986) developed a probability calculus based on his understanding of the use of words that appeal to the concept of probability (i.e., probable motive, probable cause) in English jurisprudence. The sentence Mike probably killed her because he was jealous asserts a strong claim to knowing that he was jealous and a weak claim to knowing that he killed her. The entire sentence is proven false by the discovery that Jones killed her: Probably does not provide an alibi for he was jealous in Cohens interpretation. More generally, P(A and B) min(P(A), P(B)). Furthermore, according to Cohens model, if a person believes that p is probably true or probably P, then she does not believe that p is probably false or probably not p. That is, if P(A) P( A) then P( A) 0. Finally, the probability of a hypothesis or statement about which we have no opinion is zero in Cohens interpretation: Uncertainty is equivalent to logical impossibility. MacDonald (1986) offers the Linda problem as an example of the application of Cohens exculpatory logic of belief as an alternative to the condemnationist approach of Tversky and Kahneman (1980). He states, In the intuitive probability model, subjects start with no reason to believe any of the statements (p. 20). He then goes on to give a Grice-like account of their choices, writing, in natural language questions are always motivated, that is, they are only asked when there is some reason to expect a positive answer (p. 20). Leaving aside the question of whether the statement is true in general, the added credence effect should color all of the alternatives in a positive light. Moreover, using the static part of Cohens theory, which says that P(A and B) min(P(A), P(B)) and parsing Linda is a bank teller who is active in the feminist movement as Linda is a bank teller (A) and Linda is active in the feminist movement (B), we have that P(Linda is a bank teller who is active in the feminist movement) P(Linda is a bank teller). What is needed for an application of Cohens (1982) logic of belief to the Linda problem is an extension of that logic to the kinematics of the probability function: This is the problem of updating probabilities in virtue of new information, which Bayes Theorem was meant to resolve. In this case, we can use Jeffreys (1965) updating rule as an intuitive alternative to Bayes rule: Let p(A) p(AB)p(B) p(A/ B)p( B) and P(A) p(AB)p(B) p(A B)p( B) denote the probabilities that A is true before and after learning some information about B, and p(B) and P(B) denote the prior and posterior probabilities of B. Then P(A) p(A) (P(B) p(B))Rel(A, B), where Rel(A, B) is the relevance of A to B and is given by Rel(A, B) p(AB) p(A B). If we find out that B is true, then P(B) 1 and P(A) p(A) (1 p(B))Rel(A, B). Finally, if we assume, following Cohen, that in the absence of any other information about Linda, p(B) 0, then P(A) p(A) Rel(A, B).

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Now, look at the Linda problem again. Let B represent Lindas description (bright, outspoken, single, former philosophy major). The relevance of the description to the statement, Linda is a bank teller who is active in the feminist movement is greater than that of the description of Linda to the other choosable statements. Therefore the posterior probability of Linda is a bank teller who is active in the feminist movement will be greater than that of other choosable statements. If prima facie credence of this statement has been established by its inclusion as an alternative, then this statement will be the one with the highest posterior intuitive probability.

systematically ignore base rate information in probabilistic modeling and decision-making problems. They argue that the correct use of Bayess theorem in this case would give P(BlueBlue) P(Blue)P(BlueBlue) P(Green)P(BlueGreen) P(Blue)P(BlueBlue) 0.15 0.80 0.85 0.20 0.15 0.80 0.41, (7)

Base-Rate Neglect
Tversky and Kahneman (1980, 1982) and Kahneman and Tversky (1996) have also argued that lay persons do not properly incorporate base rates for the occurrence of a phenomenon in their probability estimates of the occurrence of that phenomenon in the future. They have argued this point on the basis of two experiments (described and discussed below), and their results have been critiqued by Gigerenzer (Gigerenzer, 1993, 1994, 1996; Gigerenzer et al., 1989) on the grounds that (a) people do take base rates into account when they are allowed to perform their own draws from the relevant population distributions, and (b) that base rates as specified in Tversky and Kahnemans experiments should not be construed as properties of single events or propositions. Kahneman and Tversky (1996), argue, contra Gigerenzers (1993) claim that the mind is a frequency monitoring device, that experimental evidence seems to contradict the hypothesis that people begin to heed base rates when they themselves sample the relevant population; they also argue, contra Gigerenzers (1996) normative challenge to the interpretation of individual probabilities via frequencies, that the refusal to apply the concept of probability to unique events is a position that has some following among statisticians, but it is not generally shared by the public (Tversky & Kahneman, 1996). Leaving aside the lurking contradiction involved in making the public the arbiter of a norm that they use to criticize members of that public, we will try to show that many more possible interpretations of the base rate neglect studies than those that have been adduced by Gigerenzer (1996) are possible in view of the broader conception of reasoning under uncertainty that we have developed here. The hit and run experiment. Tversky and Kahneman (1980) used the following problem to illustrate the ignorance of base rate effects:
A cab was involved in a hit-and-run accident at night. Two cab companies, the Green and the Blue, operate in the city. You are given the following data: (a) 85% of the cabs in the city are Green and 15% are Blue. (b) A witness identified the cab as a Blue cab. The court tested his ability to identify cabs under the appropriate variability conditions. When presented with a sample of cabs (one half of which were Blue and one half of which were Green), the witness made correct identifications in 80% of the cases and erred in 20% of the cases. Question: What is the probability that the cab involved in the accident was Blue rather than Green?

assuming, of course, that the witness did not exhibit any systematic bias in the (80/20) pattern of errors toward Blue cabs or Green cabs (i.e., that the witness was not more likely to err if the cab was Blue than was the case if the cab was Green). Suppose that a participant was thinking as follows:
The experimenter is giving me a typical overdetermined problem, that is, one in which the answer depends on only a subset of the given information. To get the right answer, I must determine the subset that is relevant. Well, the subset that seems the most relevant is the credibility of the witnessI mean, he saw it happen. Therefore only the credibility of the witness should factor into the right answer. In this case, the participant would report P(Blue/Blue) 0.80.

Now, suppose that a participant trusts the witnesss proficiency in identifying a cabs color in the dark and the base rate of Green and Blue cabs in the city. Rationally, the witness should always answer Green when asked about the color of a cab. Therefore, the report of the witness is uninformative relative to the problem of deciding on the color of the cab involved in the hit-and-run accident, and the participant would report P(BlueBlue) 0.15. Birnbaum (1983) has shown that, if the participant assumes that the witness is behaving like a Neyman-Pearson statistician when approaching the color discrimination problem and that the witness knows the base rates of Green and Blue cabs in the city and chooses answers to minimize the overall probability of error, then the normatively correct answer to the Tversky and Kahneman (1980) problem can be as high as 0.82. Once again, working out the assumptions that the participant makes about what the witness knows (or, alternatively, about what the experimenter thinks is understood or implicit in the problem statement) can provide relevant alternative hypotheses of the experimental results, which do not necessarily condemn the reasoning process of the participants on the basis of these results alone. The lawyer engineer experiment. Consider another experiment that is meant to highlight base rate ignorance which uses the following experimental problem (Tversky & Kahneman, 1982):
A panel of psychologists has interviewed and administered personality tests to 30 engineers and 70 lawyers, all of whom are successful in their respective fields. On the basis of this information, thumbnail descriptions of the 30 engineers and 70 lawyers have been written. You will find in your forms 5 descriptions, chosen at random from the 100 available descriptions. For each description, please indicate your probability that the person described is an engineer, on a scale of 1 to 100. A typical thumbnail sketch reads as follows: Jack is a 45-year-old man. He is married and has four children. He is generally conservative, careful, and ambitious. He shows no interest in political and social issues and spends most of his free time on his many hobbies, which include home carpentry, sailing, and mathematical

Tversky and Kahneman (1980) interpreted the median answer P(BlueBlue) 0.80 the probability that the cab was Blue, given that the witness said it was Blueas a sign that people

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MOLDOVEANU AND LANGER puzzles. The probability that Jack is one of the 30 engineers in the sample of 100 is . Participants responses are judged to be mostly invariant to changes in the base rates of engineers and lawyers in the group.

The False Incorporation of Narrative Postevent Information

Loftus and her collaborators (1979; Loftus, Miller, & Burns, 1978) have argued that people are likely to incorporate misleading information about events they have observed firsthand or to corrupt or impair first-hand memories of these events, after this information is given to them in a narrative recounting the events. The essence of the alleged effect is the following: You see a man climbing into a sports utility vehicle and speeding away. It turns out that he was fleeing the scene of a murder. You are called as a witness in his trial, after the victims left hand is found in his kitchen cabinet. The lawyer for the prosecution asks you to describe the pick-up truck in which the man climbed, which another witness described as blue. If you are subject to the effect in question, you proceed to give a vivid account of a blue pick-up truck, even though what you saw was a black sports utility vehicle. Investigating the way we propositionalize perceptions and thus get from experience to text or narrative can help once again unpack the experimental effect and perhaps even discover that there is no overt substitution of narrative memory for visual memory. Loftus and Hoffman (1989) acknowledge, in response to the criticism of McCloskey and Zaragoza (1985) and Tversky and Tuchin (1989), that there are several mechanisms that could lead to the memory impairment effect: (a) apparent replacement of the visual memory with the narrative proposition because there was no specific visual memory in the first place; (b) mistrust of ones own memory in the face of a narrative account that came from an authoritative source; (c) guessing in the face of a lack of memory about either the narrative account or the visual memory; and (d) direct replacement of the visual memory by a memory of the narrative. McCloskey and Zaragoza (1985) argued against Loftuss (1979) conclusions by claiming to have ruled out (a) and (d) by asking participants to choose between reports that recounted the true events and reports that recounted events that were neither observed nor narrated and by reporting unimpaired ability to discriminate between the true version of the events and the alternative. The findings of Tversky and Tuchin (1989) and Belli (1989) seem to rule out (c), on the basis of findings that participants were more likely to choose the planted narrative account over both the real account and over an account that was neither observed nor planted. Accordingly, Loftus and Hoffman (1989) modified the theme of their argument by replacing the concept of memory impairment with that of misinformation acceptance. This modification is significant, as it places the memory impairment effect in the same group of effects that are obtained by people who study credulity and gullibility about statements simpliciter (Gilbert, 1991), which, moreover, can be explained by a Gricean approach to interpersonal communication. Our analysis above that concerns the difference between observations and (propositionalized) reports of observations suggests that different people can propositionalize the same set of observations in different ways. Moreover, unpropositionalized accounts may not be directly compared in memory with propositionalized accounts. When we engage in answering written questions, we engage with language. Therefore, we may be more likely to be swayed in our answers by propositionalized accounts of the incident than by unpropositionalized accounts. As we wrote above,

There is much in this experiment that depends on what the participants think that the experimenter thinks. For instance, they may think that the sentence A panel of psychologists has interviewed and administered personality tests to 30 engineers and 70 lawyers serves to establish the informativeness of the thumbnail sketch of the person. Inasmuch as the participants see themselves trying to solve a trick question one whose clues are available but not obviousthey might use this information to the detriment of the self-evident answer that is based on the relative frequencies of engineers and lawyers in the group. Call this the trickquestion approach to interactive reasoning. More sophisticated participants (than the experimenter, in this case) might think that the experimenter was trying to test their understanding of the application of the concept of probability. In particular, they think the experimenter thinks that a frequency can only become a probability in the limit as N, the sample size, increases without bounds. Whereas a frequency is the property of an ensemble of observations or individuals, a probability is a property of a single instance or event. The description of Jack proceeds in terms of properties of Jack. Therefore, if probability is to be interpreted as a property of the proposition Jack is an engineer, then it cannot be the case that the frequency of engineers in Jacks group is relevant to the problem. A somewhat contrived example may serve to illustrate the possible disadvantages of reasoning normatively about base rates. Suppose you are a young college basketball star, playing in the NCAA championship final. Your team is down 81 to 79, and there are 5 s of regular time remaining. You have the ball and are in the three-point zone. Your record on three-pointers in past games is atrocious, but you have made all of the three-point attempts tonight. You have access to two kinds of information. One kind consists of a propositionalized set of information about statistical probabilities of making the three-pointer: frequencies of successful three-pointers by yourself in the past, by yourself in critical situations, by your team in the past 10 years, by your team in the past 20 years, by your team in this game, by yourself against the two blockers you see in front of you, and so forth. Another kind consists of very detailedand possibly unpropositionalized knowledge of the specific context: that one blocker is leaning the wrong way, that another is looking for you to make the two-point shot, that a player from your team, who is just behind you, is a good sprinter and can pick up the rebound from the three-point attempt, to go along with the unpropositionalized feel of coordinating your movements to guide the ball into the hoop, which you seemed to have developed throughout the night. Are you objectively unreasonable in trying for the three-pointer, contra the overwhelming statistical evidence in favor of going for the two-point attempt? We think not: Your rich knowledge of the circumstance of time and place that relate to this particular shot should be more relevant than should be the statistical information that reliesimplicitly on only a subset of the information that you have and on a particular method of interpreting that information.

FALSE MEMORIES OF THE FUTURE

371

only two propositions can stand in a relationship of logical contradiction to one another; an observationa collection of sense data cannot contradict or support a proposition about that observation, except after the observation has been propositionalized. If we follow through this argument, we will pay close attention to the steps that require a transition from-unpropositionalized observations to propositions. Thus, in the original Loftus (1979) study, people are required to propositionalize their beliefs about the events they witnessed after receiving the propositionalized misleading information. In this case, we would predict that propositionalized information they already have will influence their reports in the direction of that informationas Loftus indeed finds. Seen in this light, the McCloskey and Zaragoza (1985) studies test for peoples ability to correctly propositionalize their observations when asked to do so because they are not given the option to report having seen the misleading account of the events. Tversky and Tuchins (1989) studies show that propositionalized postevent information is indeed persuasive, but that people retain the ability to propositionalize first-hand information. Two remarks are in order: First, students who are presumably used to taking reading comprehension tests are likely to treat the experiment as a test of their ability to remember a statement after they have read it. The statement You have seen a can of 7UP is far easier to compare with the forced-choice answers You have seen a can of Coke/7UP/Sunkist than is the unpropositionalized set of observations. Moreover, students are likely to treat the menu of the forced-choice experiment as itself informative: They will simply look up on the menu a word that they have heard come up in the past. Because all of the studies are forced choice, however, the menu dependence of the response pattern cannot be measured. Second, none of the studies show the effect of misleading propositionalized accounts of the sequence of events on the participants unpropositionalized memory of those events. Notably, none of the studies use visual tests of peoples memories; that is, none ask people to choose, after being textually misinformed, between the actual sequence of events they observed and an edited sequence of events that fits the propositionalized account.

predicts sequential dependence between consecutive shots on the basis of a set of well-corroborated assumptions about the psychological and physiological characteristics of a particular player, then one might also ostensibly make a set of judgments that seem to instantiate the gamblers fallacy without necessarily committing the gamblers fallacy, which relates to the purely extrapolative judgment process that was described above. The reason for this indeterminacy is that, as in our previous examples, the gamblers fallacy refers to an inferred psychological process for arriving at a judgment, whose inferential basis is a pattern of observable behavior that can be interpreted to lend support to several alternative hypotheses about the underlying processes that are used to arrive at the same observable behavior. It is not clear, therefore, if the gamblers fallacy findings exhibit the instantiation of a naively extrapolative approach to prediction, if they exhibit a failure to seek and incorporate refuting evidence for a causal model of player behavior, or indeed if they exhibit a rational attempt to test a detailed hypothesis about the behavior of a particular player, in a situation where the cost of erring is not very high. It would be exculpatory of the gamblers fallacy argument if it turned out that some processes that are used to generate sequences of events about which subjects are to make predictions are random in some fundamental way, if, for instance, it turned out that there is no causal model that could in principle account for these sequences of events. However, most chance devices that are meant to produce random sequences of events, such as a roulette wheel, can be modeled deterministically. A mechanical model of the wheel (Figure 2; Keller, 1986) posits an angle (t) between a point on the wheel and the position of the pointer on the wheel and a torque that opposes the motion of the wheel, such that the differential equation of motion of the wheel is d2 (t) dt 2 ; 0 t t 0, (8)

with the initial and final conditions given by 0 0; d (0) dt 0.

The Gamblers Fallacy

The gamblers fallacy relates to the propensity of people to predicate their actions on the supposition of sequential dependencies in sequences of events that are really independent, such as those that are supposedly produced by chance devices, such as coins, basketball games, or roulette wheels (Gilovich, 1991; Gilovich, Vallone, & Tversky, 1985). Many basketball fans, for instance, make predictions about the likelihood of a successful shot by extrapolating from the record of success and failure on the previous shot attempts of the player whose behavior they are trying to predict. Experimental participants betting behavior seems to ignore information about the randomness of the phenomenon that they are called to bet on. In such cases, the operative claim is that people falsely perceive sequential dependencies where in fact there are none to be found, hence the gamblers fallacy. However, one may observe the same fallacious judgments such as those coming out of purely extrapolative reasoning (naive induction) as those that might come out of judgment processes predicated on a causal model of the underlying phenomenon, including a chance device. If one has a model of behavior that

Figure 2.

Mechanical model variables for a spin of a roulette wheel.

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The integrated equation of motion of the wheel is given by (t) Because at t t0, t0 t t2 . 2 / and

0, we have that t0
2

(t0)

.
n

Because is taken modulo 2 , an initial velocity 2n , which is related to n via a final angle
n

will lead to

[2 (

2n )]1/2.

If the person who is spinning the wheel can measure or estimate the initial velocity and the opposing torque of the wheel with accuracies of and , respectively, and knows the right number will be hit if the wheel stops at a final angle of /2, then we can describe the dynamics of the error in the experiment by the equation
n

[2(

/2)(

/2

2n )]1/2.

How confident can one be of getting the wheel to stop in a neighborhood of of size , given that one has estimates of orders and of n and , respectively? Suppose 2 . Then, we have the reduced error equation
2 2

4 2

/ 2.

The range of , the right-hand side of this equation, is

2 2 2 2

4 2 2

enon that he is trying to predict and (b) that building a deterministic model of a chance device is not epistemically unreasonable. Indeed, the well-known familiarity bias (Heath & Tversky, 1991), in which individuals prefer to bet on lotteries that are drawn on events into which they have some insight and for which they supply their own, subjective probabilities (outcomes of certain football games in the case of football fans) over betting on events with objectively supplied probabilities that are identical to the probabilities supplied by the bettor, may be due to the presence of a causal model that predicts a particular event in the first case and its absence in the second case (random draws are random precisely because of the absence of a causal model for the process that is generating the individual draw; Moldoveanu, 2000a, 2000b). Building and testing causal models for individual events is not in itself irrational. Some apparently deluded gambler may be reasoning like a Popperian scientist, who builds models of localized phenomena and tests them by making predictions on the basis of those models. In the laboratory, where the phenomena one is trying to predict have been designed to be the outcomes of stochastic processes, this approach to prediction may seem unreasonable. In the real world, however, where the successful prediction of individual events depends on the incorporation of the information that is relevant to the particular event in a competent model of the underlying phenomenon, the naive lay person may be significantly more successful than would be the scientist who relies on the metaphor of the random draw from a known probability distribution. Of course, a persons model of the stochastic process that is used in the laboratory to reveal his purported naivete may be simple minded. In the case of the hot-hand phenomenon, the model may simply be the psychological insight that a string of successful field goal attempts gives a player a higher level of confidence in his skill, and that higher confidence correlates positively with a higher hit rate. We should not, however, confuse the naivete of the model with the naivete of the epistemic approach to prediction.

The degree of confidence in the prediction of the outcome of the roll of the wheel should be determined by the ratio / , that is, P( /2 (t0) /2)
max min

Summary: Levels of Analysis in the Understanding of Illusions and Biases Literature

Table 1 ties together the ideas in the first half of the article to the experimental results discussed in the second half. For each of the experimental results cited, the table shows the mechanism for generating relevant alternative interpretations and the relevant individual-level variables and constructs that should be taken into consideration in a thoughtful analysis of the results. The critical analysis that we have put forth focuses attention on several levels at which any experimental result can be unpacked and extended: linguistic (syntactic and semantic), epistemological (metacognitive), and cognitive. On the linguistic level, we can ask whether the grammatical structure of the sentences that are used by experimenters as subject material are understood by participants in the same way in which they are meant by the experimenters. Statements about cognitive competence rest on the judging of grammatical form to be the same as logical structure (Hacking, 1984). As we saw in the Linda example, if linguistic conjunction is asymmetric, whereas logical conjunction is symmetric, we can judge people as incompetent users of the probability calculus when in fact we are insensitive to subtle differences between grammatical form and logical form. Further, different interpreta-

Now, assume that can exceed 2 . If we can estimate the torque on the wheel perfectly and need to hit a precise angle (t0) 2n , then the distance between n and n 1 is a decreasingfunction of n, that is, 2
n 1 n n

[1

2 n

)].

As n increases, the margin or error in the estimate of n that is needed to hit a particular will decrease, and it will take increasingly accurate estimates of n to make estimates of of a given accuracy: This may explain why roulette wheels in casinos are spun at such high initial velocities. We are not claiming that all lay persons actually do engage in such sophisticated modeling of chance devices (although some may). What we are claiming is (a) that the deluded gambler may engage in some model-building for the chance device or phenom-

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373

Table 1 Summary of Alternative Epistemic Approaches to Forced-Choice Problems Found in the Experimental Literature and of the Alternative Bases They Provide for Answering Forced-Choice Problems
Approach Personal epistemological commitment Interpretation of interpersonal logic of the situation Conjunction fallacy Popperian interpretation of choice problem that leads to a different logic of decision Gricean interpretation based on cooperation principle; menu of choices seen as informative and relevant Intuitive approach to probability measure Bayes/Jeffrey approach to updating probabilities Classical interpretation of probability measure Mismatch between visual information and propositional account of visual information Gricean logic that governs understanding of propositional information; menu of choices seen as informative Base-rate ignorance Memory distortion effect Gamblers fallacy Prior model of physical device that influences interpretation of subsequent information about the device

Interpretation of probability measure Interpretation of probability kinematics Observations versus propositional representations of observations

tions of the questions and of the interpersonal context in which the questions were asked can lead to response patterns that are reasonable given the problem that the subject was really trying to solve, but unreasonable given the problem the experimenter thought the subject was trying to solve. Here again, we stand the danger of confusing our misinterpretation with subjects cognitive errors. On the epistemological level, we can ask what alternative (and normatively valid) epistemologies can lead to response patterns that are often judged to be fallacious by the standards of inductive inference and Bayesian kinematics of the probability function. As we saw in several examples, different epistemological commitments can lead to response patterns on cognitive tasks that are fallacious by the standards of inductive inference, but are quite reasonable given some other epistemological commitment. Thus, we would benefit from asking (and pursuing experimental studies to answer) the question, What kind of epistemologists can we expect to find among our experimental subjects? On the cognitive level, even after we have ascertained that participants are really inductivists and that probability measures are sound ways in which to represent their degrees of belief, there are still different probability measure structures (Cohen, 1982) and kinematics (Jeffrey, 1965) that can give us normative explanatory accounts of observed deviations from the Bayesian logic of belief. Once again, experimental investigations aimed at validating these alternative accounts of the dynamics of belief can go a long way to serving the reconstructive project that we have advocated in this article.

Concluding Comments
As Nickerson (1996) has pointed out, the tasks that participants in experiments involving choice under uncertainty are asked to carry out are on close inspection considerably more ambiguous than they seem to be at first sight. Making correct judgments or choices from the information that was given to the participants

depends on an unspoken set of assumptions about that information, which may or may not be justified. It is not clear, therefore, that deviations from such correct answers instantiate cognitive errors; they may alternatively instantiate divergences in the set of assumptions that people make about the decision scenario. If the latter is true, then the decision scenarios that are associated with the cognitive biases literature are unspecified, and conclusions about the incompetence of decision makers vis-a-vis the axioms ` of calculus of probability may be premature. We argued in this article a version of the argument that data underconstrains theory that is particularized to the specific field of cognitive proclivities that surround judgment under uncertainty; specifically, that (a) the choice of an epistemological approach to judgment formation and (b) the choice of the proper model for predicting an event or forming a belief about a proposition with yet-unknown truth value are not self-evidently implied by the way in which a problem is formulated. We gave examples from the vast literature that purports to document cognitive biases and illusions, wherein the assumption of a single, self-evidently correct interpretation of a decision problem is crucial to reaching the conclusion that people are poor intuitive scientists. It is important to differentiate our focus from the focusno less important on the relationship between the cognitive schemata and algorithms that people use to solve a problem and the format in which information about the problem is presented to them (Gigerenzer & Hoffrage, 1995). In that case, the data that is to function as evidentiary basis for the solution of the problem is itself a source of information, not only as input to the solution algorithm that an individual mind uses, but also as a discriminator among different alternative solution algorithms that one can use. To the point, presenting data in frequency formats rather than in probability formats seems to induce participants to use Bayesian solution algorithms for updating beliefs without the need for training in the logic of Bayesian probability kinematics. Although quite different from our focus, this link between data and choice of

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theory used to interpret or process the data will, we expect, require a similarly detailed analysis to the one we have provided regarding the multiplicity of possibleand possibly normativetheories for understanding a problem statement. Our article focuses on several sources of epistemic indeterminacy in the formulation of decision problems that are used in tests of cognitive processes: First, how is an outcome space represented? As Rottenstreich and Tversky (1997) argue, the proper objects that populate a probabilistic state-space are propositions about events. Simply put, to use the calculus of probability, we must first propositionalize an event space. We showed that different propositionalizations of an event space can have different implications for our use of the probability calculus. Second, what problem is the participant trying to solve when answering questions in forced-choice experiments? If the participant is trying to outguess the experimenter or trying to read the experimenters intentions into the problem statement, then the experimental results will reveal different features of cognition than if we assume that the participant is reacting to the problem as it is understood by the experimenter. Third, what epistemic approach is taken by the participant? We showed that, depending on the hypotheses that were tested and the technique of drawing inferences that was used, participants can arrive at different response patterns and can, on the basis of normatively sound reasoning, arrive at what are portrayed as normatively incorrect judgments. We know on a priori reasoning grounds that several different cognitive process theories can be used to explain the same observed sequence of empirical observations on forced-choice tasks that require some predictive judgment. What we have done is to give a map of the alternative models of judgment formation that one can use to explain findings that stem from research on cognitive biases and fallacies and to argue that many of these models can be used to interpret those same findings as indicative of cognitive competence, rather than of incompetence. Of particular significance is the proposition that peoples judgments may reveal a particular commitment to the process of modeling (trial and error) that is a cornerstone of Popperian fallibilistic reasoning, rather than be an outright failure to follow the extensional logic of probability theory that is attributable either to the correct application of probabilistic logic to alternative representations of the underlying cognitive task (Rottenstreich & Tversky, 1997) or to the incorrect applications of the logic of probability to the intended representation of the cognitive task (Cohen, 1981). Rather, the logic-in-use that experiment participants follow may not be fashioned on the probabilistic mode at all and may reveal different epistemological or metacognitive approaches to the task at hand that are valid in their own frame of reference (e.g., falsificationism). The art of forming beliefs about individual events may have little to do with long-run average statistics of past events of a particular type or, indeed, with any of the alternative interpretations of probability that we outlined in this article. Such statistics are bound to be different for different representations of the same event, thus presaging a choice between alternative representations of the event space. Perhaps it is time to reconsider our indictment of the lay persons psychology of prediction and to take seriously the reconstructive program of searching for valid psychological mechanisms for the experimental findings in this burgeoning literature.

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Received July 8, 1997 Revision received March 2, 2001 Accepted March 12, 2001