Instance-based generalization for human judgments about uncertainty.

While previous studies have shown that human behavior adjusts in response to uncertainty, it is still not well understood how uncertainty is estimated and represented. As probability distributions are high dimensional objects, only constrained families of distributions with a low number of parameters can be specified from finite data. However, it is unknown what the structural assumptions are that the brain uses to estimate them. We introduce a novel paradigm that requires human participants of either sex to explicitly estimate the dispersion of a distribution over future observations. Judgments are based on a very small sample from a centered, normally distributed random variable that was suggested by the framing of the task. This probability density estimation task could optimally be solved by inferring the dispersion parameter of a normal distribution. We find that although behavior closely tracks uncertainty on a trial-by-trial basis and resists an explanation with simple heuristics, it is hardly consistent with parametric inference of a normal distribution. Despite the transparency of the simple generating process, participants estimate a distribution biased towards the observed instances while still strongly generalizing beyond the sample. The inferred internal distributions can be well approximated by a nonparametric mixture of spatially extended basis distributions. Thus, our results suggest that fluctuations have an excessive effect on human uncertainty judgments because of representations that can adapt overly flexibly to the sample. This might be of greater utility in more general conditions in structurally uncertain environments.