At around the age of seven there is a growth spurt in human brain development. This is mainly in the left hemisphere, which gives us entry into the world of intellect, logic and reasoning.
From 15 to the mid-20s, an area known as the prefrontal lobes begin to develop and function. We now know that these areas are involved in future planning and long-term risk assessment.
The implications of this knowledge in relation to decision making in adolescents is enormous. Firstly, we shouldn't expect young children to make rational decisions. They simply don't have the hardware. It's not until sometime after seven do they begin to do abstract thinking, because at this stage the hardware that does abstract thinking becomes prominent.
If your teenager has ever done something you consider stupid, and your reaction was 'What were they thinking?' Well, the answer is they were thinking about doing that thing and the associated pleasure. They were not thinking long-term, nor considering the risks. Again, the hardware, the prefrontal lobes, simply isn't functioning yet in a way that allows them to consider the long-term consequences of their actions.