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Dynamic and consequential consistency of choices between paths of decision trees.

The generally prescribed procedure for choosing a decision strategy from a decision tree employs a backward induction analysis that entails 3 fundamental consistency principles: dynamic, consequential, and strategic. The first requires the decision maker to follow through on plans to the end, the second requires the decision maker to focus solely on future events and final consequences given the current state of events, and the third is the conjunction of the first 2. Five experiments were reported to test these principles using different subject populations, different procedures for estimating consistency, and different factors for manipulating the attractiveness of the gamble at the final stage of the tree. The main findings were that strategic and dynamic consistency principles were violated at rates that exceeded choice inconsistency.