Abstract
Economic decision-making of the poor had negative effects on controlled behavior. This may be because the poor decisions making required more difficult trade-offs, and low - set of cognitive resources. The research revealed that the decision making of the poor in terms of expected value maximization is characterized by their strict adherence to the invariance and dominance principle. In contrast, the decision making of the non-poor is characterized by willingness to accept loss provided that the loss is insignificant compared to their wealth. The invariance principle does not appear to be followed by the poor more often than by the nonpoor. It signifies that the poor and the non-poor decision making process violated the invariance principles towards certain situations. Hence, this research primarily validates that invariance and dominance principle in decision theory is the best parameter in determining the poor decision making process.
Recommended Citation
Paspasan, Rodin M. and Padua, Roberto N.
(2012)
"Validation of the Invariance and Dominance Principles in Decision Theory in the Urban Poor Decision Making Process,"
CNU Journal of Higher Education: Vol. 6:
Iss.
2, Article 8.
DOI: https://doi.org/10.70997/2546-1796.1151
Available at:
https://jhe.researchcommons.org/journal/vol6/iss2/8