Conviction Narrative Theory: A More Realistic Foundation for Economics and Judgment and Decision-Making.
Real-world decisions differ in many ways from those studied in laboratories and textbooks. We must often make massively consequential choices when, whether we know it or not, data is incomplete, the options are ambiguous, the future may not resemble the past, and the axioms of standard decision theory are not satisfied. Such decisions often require both commitment and flexibility over time. Above all, such decision-making is about taking action in the face of potentially paralyzing uncertainty. While choices like monetary gambles may be amenable to standard analyses, it is far less clear how career choices, climate change, pandemic mitigation, and most government policy can be effectively understood in this way. Conviction Narrative Theory is a theory of decision-making that sets out how human cognitive, affective and social capacities are well adapted for such decisions and identifies the implications for research and decision-makers.