Bounded rationality is rare

Alfio Giarlotta, Angelo Petralia and Stephen Watson

Journal of Economic Theory, 2022, vol. 204, issue C

Abstract: Most bounded rationality properties in the literature are inherited by subchoices, but are not satisfied by at least one subchoice of most choice functions. Therefore the fraction of choice functions that can be explained by these models goes to zero as the number of items tends to infinity. Numerical estimates confirm the rarity of bounded rationality even for small sets of alternatives.

Keywords: Bounded rationality; Hereditary property; Choice isomorphism; Rarity; Numerical estimates (search for similar items in EconPapers)
JEL-codes: D01 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:204:y:2022:i:c:s0022053122000990

DOI: 10.1016/j.jet.2022.105509

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