Researchers from multidisciplinary scientific fields have been puzzled by human behaviour in dynamic and complex decision-making contexts. Since the seventeenth century, several theoretical, conceptual, and empirical contributions have emerged. These contributions evidence the need to critically assess the rational foundations of decision theories, stemming from the cognitive basis for human heuristics and bias. This chapter focuses on how socio-cognitive theories have been introduced as analytic tools to explain individual and collective behaviours, decision rules, and cognitive mechanisms. In particular, the authors advance some arguments explaining its importance and the underlying challenges of social representations as part of the decision-making process. They propose a methodological script that stresses the social representations approach and encounters more functional and operational settings.
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There is a large amount of literature providing insights on the subject of decision-making and the overall process. It goes back to the seventeenth century with solid and formal studies and reached a point of maturity in the mid and late 1940s grounded on mathematical foundations and quantitative methods (Doyle and Thomason, 1999). Decision theory has been useful in explaining how individuals make choices by following certain axioms. Real life decisions, however, uncover some flaws in the application of these axioms, as they require multidisciplinary examination. New emerging theories of decision-making acknowledge that it is essential to add more layers, which are able to deal with the complexity of cognitive bias and other issues in social sciences. Every decision encounters trade-offs with challenges for both sides: who designs the decision process and who has to choose, and to whom those decisions are directed. The complex exercise during problem formulation and alternative design is related to the way expectations, preferences and uncertainty are dealt with. Otherwise, the outputs, besides being useless, are nothing less than grave (and irreversible) mistakes. Every model is an attempt at simplification, grounded on assumptions that outline the understanding and application of the results. Regarding decision models, names such as Nicholas Bernoulli, John von Neumann, and Oskar Morgenstern, Herbert Simon, Daniel Kahneman and Amos Tversky are great contributors to this question, ranging from rational foundations to a cognitive basis for human heuristics and bias. In the 1950s, in order to bridge some of the gaps in the decision literature, because human behaviour cannot be simply explained by classic economic models, some authors called for debate on the influence of motivation, conflict, cognitive limits to rationality, and planning and innovation (Arnott and Gao, 2019a; Hoch, Kunreuther, and Gunther, 2001; Jodelet, 2008; Moscovici, 1988; Simon and Newell, 1971; Tversky and Kahneman, 1974, 1981).
Hoch et al., (2001) present a systematic compilation based on evidence-based experiences from four perspectives: personal, managerial, negotiator, and consumer. The direction goes towards simulation models, optimization tools, behavioural approaches, anchoring and adjustment strategies. However, even though integrated approaches are assumed to be important and some guidelines include such concern, other aspects continue uncovered by the literature. As in many other decision-making domains, consumer behaviour clearly draws on economic and psychological factors. Besides expected means-ends objectives, understanding consumption patterns involves a complex interrelation of subjective dimensions of the (socio) cognitive structure. Indeed, with a strong contribution of the overall cognitive framework, Reynolds and Olson (2001) share evidence on how behaviour is determined by the characteristics of the choice situation, evoking beliefs and (unconscious) motivations. Many decision-making models have been used as a reference for marketing strategies over the past decades, with particular focus on behavioural decision theory. Stankevich (2017) shows how these theories have challenged predictions from economic theory and assumptions about rationality. Using the official definition of consumer behaviour, recalled by Stankevich, means the processes used by individuals, groups, or organizations are at the basis of analysis, as well as the impacts that these processes have on the consumer and society. About this, Gupta (2009) structures the importance of this notion according to possible applications, beyond marketing purposes, namely in the spectrum of policy. The implications for public policy should not be understated. First, because consumer decisions or behaviours reveal preferences for specific goods and services, and consequently because “the way in which other people behave and the internal motivations that influence consumer choices are just as likely to bias and override individual preferences as the cognitive short-cuts” (Policy Studies Institute, 2006; p. 42).