Decision Utility

What is decision utility?

Decision utility is the weight an outcome receives in a person's choices. It is inferred from preferences and decisions, rather than simply being a forecast of how happy the person expects to feel.

Decision, predicted, experienced, and remembered utility

Kahneman, Wakker, and Sarin (1997) distinguish decision utility from experienced utility: the pleasure or discomfort of the experience itself. Predicted utility concerns expectations about a future experience; remembered utility concerns its later evaluation.

What someone chooses, expects, experiences, and remembers can differ. Keeping these measures separate helps clarify what a study or practical recommendation is actually claiming.

Example of the distinction

Imagine choosing a concert over another evening out. The choice gives information about your preferences. It does not tell us exactly how much you expect to enjoy the concert, how the evening feels while it happens, or how you will remember it afterward.

Why it matters

A choice alone does not establish that an option produces the best experience. To assess a mismatch, define the experience measure and compare suitable alternatives. Ask separately what people choose and how they evaluate the experience.