The limitations of decision-making

Abstract

In a world faced with technological, health and environmental change and uncertainty, decision-making is challenging. In addition, decision-making itself is becoming a collaborative activity between people and artificial intelligence. This paper analyses decision-making as a form of information processing, using the ideas of information evolution. Information evolution studies the effect of selection pressures and change on information processing and the consequent limitations of that processing. The analysis identifies underlying information evolution factors that affect the quality of information used throughout decision-making and, hence, affect the quality of decisions. These factors imply a set of challenges in which the pressures that drive useful trade-offs in a static environment also hinder decision-making of the required quality in times of change. The analysis indicates the information evolution characteristics of a good decision-making approach and establishes the theoretical basis for tools to demonstrate the information evolution limitations of decision-making.