This chapter presents preliminary discussions about decision that include short overview, relationship between decision and theoretical question with examples and theories or approach of decision as critical parts in discussing the decision subject. The goal of this presentation is the nurture of firm understanding on the essential tenets about decision.
OVERVIEW OF DECISION THEORY
In the simplest term, Decision Theory (DT) is theory about decisions. Academic discussion about decision theory is critical due to that there exist many theories about decision. Knowing all the theories that underlying the decision made would enable one to at least:- realize the principle and methodological one follows, mechanisms and supports required for that principle and reach into a justifiable and firm decision.
Within the decision theory, there are normative and descriptive theories or approaches with prescriptive appears as variation of normative theory. The variety of ways to conceptualizing and looking at decisions yield many different research cultures and traditions. Some are heavily rely on mathematics, some explore psychological dimensions and others might focus on the methodological aspects of decision.
DECISIONS AND THEORETICAL QUESTION ABOUT DECISION
A decision is a resolution that one chooses from a variety of alternatives. Many formal conceptual definitions for decision are available. Examples are;
i. a position arrived at after consideration
ii. the identification of and commitment to a course of action iii. decision relates to the activity – to decide – as the final point of decision making process that has involved complex processes of problem solving
From all these definitions, we learn that decision is stem from some theoretical questions or there must be some theoretical questions in the ground prior to making decision. In this sense, the theoretical questions are problem that requires resolution. The relationship between the decision and theoretical questions is inevitable since there would be no decision without problem. The following propositions are examples of theoretical problems and the decisions to all these propositions are relative.
What would I dress to lecture today?
The decision made would depend on the frequent use of apparel, availability and readiness and perhaps suitability with activities to be conducted in the lecture session.
Which restaurant would I go for lunch this afternoon?
The decision might depend on the time available, attraction of dishes or other external influences such as colleagues or weather.
Should I purchase imported or local car?
Issues such as pride, price and value, maintenance, loan facility and other considerations will significantly influenced the purchasing decision.
In our everyday’s life, child or adult, man or woman, we face a series of heavy or light problems that seek for or involve decision. In this sense, theorizing about decision can be thought as theorizing about our daily activities. However, we limit decision theory to include those that worth attended and unstructured or ill-structured; and exclude those are straight forward and structured. This limitation led by that in any unstructured situations or problems, there exist a set of alternatives to choose from and one chooses in a systematic way, not in random. The selection is often based on goal directed activities, and hence decision theory is concerned with goal-directed behavior in the presence of options.
Decision theory has two goals i.e to describe how agents do make decisions (descriptive decision theory) and to prescribe how agents should make decisions (prescriptive decision...
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