Risk Taking and Decision Making

Learning Outcomes

Subject Specific Intellectual and Research Skills

Having successfully completed this module you will be able to:

• identify, characterise and reduce the impact of biases in decision-making caused by heuristics;
• communicate issues and difficulties of applying decision models;
• apply appropriate decision making models in order to select optimal strategies in situations involving uncertainty;
• critically evaluate the relative strengths of a variety of decision making techniques;
• analyse decision problems using a systematic and inter-disciplinary approach and justify this approach;
• generate appropriate subjective probability estimates.

Knowledge and Understanding

Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:

• the relative strengths of decision models and be able to apply them in a systematic manner;
• the importance and relative advantages of both objective and subjective information.
• the key issues involved in developing effective and integrated risk management capability.
• the central role of decision making and risk taking in effective management;

Transferable and Generic Skills

Having successfully completed this module you will be able to:

• be aware of the factors that must be considered in order to make effective decisions.

• The nature of decision-making and decision modelling
• Structuring a decision
• Decision models to handle uncertainty
• Decision models to handle risk
• Risk attitude and utility
• Individual differences in risk taking
• Group risk taking
• Subjective judgments, heuristics and biases
• Subjective probability elicitation
• The role and value of information in improving decisions
• Decision making in a competitive environment

The module is taught via a series of 2 hour lectures. These will be interactive sessions, you will be expected to engage via a series of class and group-based exercises, providing you with the opportunity of practising the techniques introduced. Performance in these tasks will also provide a form of formative feedback to help you know your areas of strength and weakness on the module materials. You will be expected to read the core text and practice examples provided in this text. In addition, you will be provided with a workbook, which will provide a summary of the lecture material and will contain a number of exercises for you to attempt. This will help you practice the techniques discussed in lectures. Solutions to these exercises will be provided to enable you to identify areas of the module in which you are strong and those where you need to undertake more study.

You will be provided with a list of articles and chapters from text books to read for each topic studied on the module.

Students will be provided with a list of articles and chapters from text books to read for each topic studied on the module.

Formative

This is how we’ll give you feedback as you are learning. It is not a formal test or exam.

Class Exercise

• Assessment Type: Formative
• Feedback: The module will include class exercises and group exercises which will allow you the opportunity to apply the lessons discussed in the lecture. You will also be provided with a workbook which will contain a number of exercises to help you practice the techniques discussed in lectures. Suggested solutions to these exercises will also be provided.
• Final Assessment: No
• Group Work: Yes

Summative

This is how we’ll formally assess what you have learned in this module.

Referral

This is how we’ll assess you if you don’t meet the criteria to pass this module.

Repeat

An internal repeat is where you take all of your modules again, including any you passed. An external repeat is where you only re-take the modules you failed.