Cited by 718Decision-Making and Behavioral EconomicsEconomic Theory and InstitutionsExperimental Behavioral Economics Studies

Bounded Rationality

Simon, Herbert A.·1990·Utility and Probability

Abstract

The term ‘bounded rationality’ is used to designate rational choice that takes into account the cognitive limitations of the decision-maker — limitations of both knowledge and computational capacity. Bounded rationality is a central theme in the behavioural approach to economics, which is deeply concerned with the ways in which the actual decision–making process influences the decisions that are reached.

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Crossref · 10.1007/978-1-349-20568-4_5

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8 of 8 references verified0 citation errors · 0 not checkable

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  • Despite their reputation for undermining optimal decision-making, biases can actually reflect optimal decisions within a particular socio-environmental context under cognitive constraints such as memory, computation or experience.

    “Despite their reputation for undermining optimal decision-making, biases can actually reflect optimal decisions within a particular socio-environmental context under cognitive constraints such as memory, computation or experience [98][99][100][101][102] .”

    From Machine culture (2023) · cites this paper as [99]

  • The effects of biases on culture tend to strengthen through repeated transmission.

    “Irrespective of their origin, the effects of biases on culture tend to strengthen through repeated transmission 99,104,105 .”

    From Machine culture (2023) · cites this paper as [99]

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Authors
Simon, H. A.
Corresponding author
Simon, Herbert A.
Venue
Utility and Probability
Published
1990
Pages
15-18
OpenAlex
W4249761288
Cited by
705
References
11
Citations by year
2026: 68 · 2025: 100 · 2024: 113 · 2023: 105 · 2022: 96 · 2021: 66 · 2020: 66 · 2019: 12 · 2018: 5 · 2017: 7 · 2016: 7 · 2015: 7 · 2014: 5 · 2013: 4 · 2012: 3
FWCI
4.16
Type
book chapter
Language
en
Open access
closed
Locations
Palgrave Macmillan UK eBooks (publishedVersion)
Topics
  • Social Sciences › Decision Sciences › General Decision Sciences › Decision-Making and Behavioral Economics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Theory and Institutions
  • Social Sciences › Safety Research › Experimental Behavioral Economics Studies
Keywords
bounded rationality, rational choice, cognitive limitations, computational power, behavioral economics, decision-making, limits of knowledge

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