Power now involves external human intervention into the constrained maximizing behavior of individuals. If I can affect the final utility experienced from that behavior, I have some form of power. Maximizing subject to constraints is, in turn, a process of making choices. Therefore, a careful examination of the potential for power requires a systematic look at decision processes. In recent years a formal theory of decisions has been developed. Though originally structured as a tool for improving the quality of decisions reached, it is equally useful for isolating the elements of a choice and for identifying possible locations for the exercise of power. This chapter begins by presenting the tools of formal decision theory and then proceeds to use them for that purpose.

Decision trees

The central tool of decision theory is the schematic diagram known as a “decision tree.” Choices are separated into distinct elements that are systematically related to each other in a strict sequence of time. Decision theory postulates four elements in such a choice: “decision nodes,” “chance nodes,” “probabilities,” and “payoffs.” It places them in explicit sequence under a strong assumption of linear time. Each moment comes but once, following all previous ones, preceding all later ones.