Bounded rationality

1. Rethinking Rationality / Gerd Gigerenzer and Reinhard Selten 2. What Is Bounded Rationality? / Reinhard Selten-- 3. The Adaptive Toolbox / Gerd Gigerenzer-- 4. Fast and Frugal Heuristics for Environmentally Bounded Minds / Peter M. Todd-- 5. Evolutionary Adaptation and the Economic Concept of Bounded Rationality - A Dialogue / Peter Hammerstein-- 6. Group Report: Is There Evidence for an Adaptive Toolbox? / Abdolkarim Sadrieh, Werner Guth and Peter Hammerstein / [et al.]-- 7. The Fiction of Optimization / Gary Klein-- 8. Preferential Choice and Adaptive Strategy Use / John W. Payne and James R. Bettman-- 9. Comparing Fast and Frugal Heuristics and Optimal Models / Laura Martingnon-- 10. Group Report: Why and When Do Simple Heuristics Work? / Daniel G. Goldstein, Gerd Gigerenzer and Robin M. Hogarth / [et al.]-- 11. Emotions and Cost-benefit Assessment: The Role of Shame and Self-esteem in Risk Taking / Daniel M. T. Fessler-- 12. Simple Reinforcement Learning Models and Reciprocation in the Prisoner's Dilemma Game / Ido Erev and Alvin E. Roth-- 13. Imitation, Social Learning, and Preparedness as Mechanisms of Bounded Rationality / Kevin N. Laland-- 14. Decision Making in Superorganisms: How Collective Wisdom Arises from the Poorly Informed Masses / Thomas D. Seeley-- 15. Group Report: Effects of Emotions and Social Processes on Bounded Rationality / Barbara A. Mellers, Ido Erev and Daniel M. T. Fessler / [et al.]-- 16. Norms and Bounded Rationality / Robert Boyd and Peter J. Richerson-- 17. Prominence Theory as a Tool to Model Boundedly Rational Decisions / Wulf Albers-- 18. Goodwill Accounting and the Process of Exchange / Kevin A. McCabe and Vernon L. Smith-- 19. Group Report: What Is the Role of Culture in Bounded Rationality? / Joseph Henrich, Wulf Albers and Robert Boyd / [et al.].--

In a complex and uncertain world, humans and animals make decisions under the constraints of limited knowledge, resources, and time. Yet models of rational decision making in economics, cognitive science, biology, and other fields largely ignore these real constraints and instead assume agents with perfect information and unlimited time. About forty years ago, Herbert Simon challenged this view with his notion of 'bounded rationality.' Today, bounded rationality has become a fashionable term used for disparate views of reasoning. ; ; This book promotes bounded rationality as the key to understanding how real people make decisions. Using the concept of an 'adaptive toolbox,' a repertoire of fast and frugal rules for decision making under uncertainty, it attempts to impose more order and coherence on the idea of bounded rationality. The contributors view bounded rationality neither as optimization under constraints nor as the study of people's reasoning fallacies. The strategies in the adaptive toolbox dispense with optimization and, for the most part, with calculations of probabilities and utilities. The book extends the concept of bounded rationality from cognitive tools to emotions; it analyzes social norms, imitation, and other cultural tools as rational strategies; and it shows how smart heuristics can exploit the structure of environments.