DO DECISION QUALITY AND PREFERENCE ORDER DEPEND ON WHETHER PROBABILITIES ARE VERBAL OR NUMERICAL

A surprising but common finding is that decision-making performance se ems, on average, unaffected by whether decisions are based on probabil ity phrases or on numerical probabilities. This study, however, shows that on a trial-by-trial basis, preferences change as a function of ho w gamble probabilities are represented. Decision makers rank ordered p ositively valued gambles whose probabilities were another individual's verbal or numerical chance estimates of specific events. Results show ed that decision makers' rankings correlated more closely with payoffs when probabilities were expressed verbally rather than numerically. T his effect, in conjunction with the correlational structure of the gam bles, resulted in differential earnings. under the two probability con ditions. Verbal probabilities led to higher average expected profits w hen gamble outcomes were more positively correlated with expected valu e than were the gamble probabilities. The opposite was true for numeri cal estimates.