Effects of cognitive noise on the temporal dynamics of risky choices

Brisbane Convention & Exhibition Centre 

Real-life choices often require striking a balance between the value of choice outcomes and their likelihood. When taking out flood insurance, for example, it is important to consider both the cost of any damage and the probability of flooding. Rational choice theory assumes that risky choices rely on an optimal integration of choice values with their probabilities. The literature, however, is replete with examples of irrational, biased choices, and these observations have motivated piecemeal modifications of the theory. Recently proposed cognitive imprecision theory can account for most reported biases in a principled fashion by assuming that noisy subjective representations of choice value and probability are integrated optimally. Here, we developed a novel perceptual game to test a key prediction of this theory, namely, that the temporal dynamics of risky choices and their neural correlates should co-vary with cognitive noise. Forty healthy, adult humans first estimated the average orientation of a briefly presented circular array of twelve differently oriented gratings and then chose to either play the game or not (risky and safe choices). If they chose to play, they were awarded points proportional to the average orientation in that trial. Noise was manipulated by randomly switching between high and low variability in the orientations of displayed gratings. Computational modelling of behaviour showed that cognitive noise impacted estimates of loss and risk aversion. Similarly, multivariate feature-specific analyses of functional brain activity showed an effect of noise on the precision of neural value representations, lending neurobiological support to the cognitive imprecision theory.