Bounded Rationality: The Adaptive Toolbox

by Gerd Gigerenzer (Editor), Reinhard Selten (Editor)

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.

Genres: Psychology, Economics, Philosophy, Business

393 pages, Paperback

First published February 19, 2001

About the author

Gerd Gigerenzer is a German psychologist who has studied the use of bounded rationality and heuristics in decision making, especially in medicine. A critic of the work of Daniel Kahneman and Amos Tversky, he argues that heuristics should not lead us to conceive of human thinking as riddled with irrational cognitive biases, but rather to conceive rationality as an adaptive tool that is not identical to the rules of formal logic or the probability calculus.

Gerd Gigerenzer ist ein deutscher Psychologe und seit 1997 Direktor der Abteilung „Adaptives Verhalten und Kognition“ und seit 2009 Direktor des Harding-Zentrum für Risikokompetenz, beide am Max-Planck-Institut für Bildungsforschung in Berlin. Er ist mit Lorraine Daston verheiratet.

Gigerenzer arbeitet über begrenzte Rationalität, Heuristiken und einfache Entscheidungsbäume, das heißt über die Frage, wie man rationale Entscheidungen treffen kann, wenn Zeit und Information begrenzt und die Zukunft ungewiss ist (siehe auch Entscheidung unter Ungewissheit). Der breiten Öffentlichkeit ist er mit seinem Buch Bauchentscheidungen, bekannt geworden; dieses Buch wurde in 17 Sprachen übersetzt und veröffentlicht.

[English bio taken from English Wikipedia article]

[Deutsche Autorenbeschreibung aus dem deutschen Wikipedia-Artikel übernommen]

Reviews

[Steven Peterson · Rating 5 out of 5]

This edited volume is an important addition to the work on human decision-making under conditions of uncertainty, in which people use "rules of thumb" to produce cost-effective decisions that are not strictly "rational." From the psychological literature, the work of Kahneman and Tversky is well know (and has been rewarded with international recognition). However, they do not explicitly link such behavior (often referred to as "heuristics") to evolution and biology. And they tend to define these "rules of thumb" as rather poor guides to decision making.

The essays in this edited volume provide a different--and more optimistic picture--of such heuristics. The contributors provide evidence and logic to suggest that evolution has led to the development of decision making shortcuts that "work" reasonably well.

One can disagree with certain aspects of this work (they may be a bit harsh on Kahneman and Tversky and their peers; they may be overly optimistic about some of the heuristics that they mention). Nonetheless, this work is a wonderful introduction to a literature on how humans actually think and decide--rather than relying on abstract conceptualizations often prevalent in the social sciences, including the simplistic "rational choice" theory ascendant in several social science disciplines. This book represents a welcome corrective to such perspectives.

[Jon Gauthier · Rating 3 out of 5]

Models of rational decision making in economics, cognitive science, biology, and other fields … tend to ignore these constraints and treat the mind as a Laplacean superintelligence equipped with unlimited resources of time, information, and computational might.

Heuristics in the adaptive toolbox are modeled on the actual cognitive abilities a species has rather than on the imaginary powers of omniscient demons.

Quite a few straight-talking articles here. Direct links to artificial intelligence, too—the founder of this school was Herbert Simon, after all.