Bounded Rationality

Masao Ogaki and Saori C. Tanaka ()
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Saori C. Tanaka: ATR Brain Information Communication Research Laboratory Group

Chapter Chapter 5 in Behavioral Economics, 2017, pp 71-82 from Springer

Abstract: Abstract This chapter explains bounded rationality, which is rationality bounded by human abilities. For the purpose of studying bounded rationality, the optimization approach of traditional economics has difficulties such as the infinite regress problem. Hence it has been complemented by the descriptive approach in which intuitive judgment such as heuristics is shown to often lead to biases in experiments.

Keywords: Beauty contest game; Level-k model; Infinite regress problem; Heuristics (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sptchp:978-981-10-6439-5_5

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DOI: 10.1007/978-981-10-6439-5_5

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