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Towards a Rational Theory of Heuristics

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Minds, Models and Milieux

Part of the book series: Archival Insights into the Evolution of Economics ((AIEE))

Abstract

Herbert Simon left us with an unfinished task, a theory of bounded rationality. Such a theory should make two contributions. First, it should describe how individuals and institutions actually make decisions. Understanding this process would advance beyond as-if theories of maximizing expected utility. Second, the theory should be able to deal with situations of uncertainty where ‘the conditions for rationality postulated by the model of neoclassical economics are not met’ (Simon, 1989, p. 377). That is, it should extend to situations where one cannot calculate the optimal action but instead has to satisfice, that is, find either a better option than existing ones or one that meets a set aspiration level. This extension would make decision theory particularly relevant to the uncertain worlds of business, investment, and personal affairs.

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Authors
  1. Gerd Gigerenzer
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Editor information

Editors and Affiliations

  1. San Diego State University, USA

    Roger Frantz (Professor of Economics) (Professor of Economics)

  2. The University of British Columbia, Canada

    Leslie Marsh (Senior Research Associate) (Senior Research Associate)

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© 2016 Gerd Gigerenzer

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Gigerenzer, G. (2016). Towards a Rational Theory of Heuristics. In: Frantz, R., Marsh, L. (eds) Minds, Models and Milieux. Archival Insights into the Evolution of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/9781137442505_3

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