Reason, Intuition, and Time

Marco Sahm, Robert K. von Weizsäcker and Robert K. von Weizsäcker

No 5134, CESifo Working Paper Series from CESifo

Abstract: We study the influence of reason and intuition on decision making over time. Facing a sequence of similar problems, agents can either decide rationally according to expected utility theory or intuitively according to case-based decision theory. Rational decisions are more precise but create higher costs, though these costs may decrease over time. We find that intuition will outperform reason in the long run if individuals are sufficiently ambitious. Moreover, intuitive decisions are prevalent in early and late stages of a learning process, whereas reason governs decisions in intermediate stages. Examples range from playing behavior in games like Chess to professional decisions during a manager’s career.

Keywords: expected utility theory; case-based decision theory; cognitive costs; learning (search for similar items in EconPapers)
JEL-codes: C63 D81 D83 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.cesifo.org/DocDL/cesifo1_wp5134.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_5134

Access Statistics for this paper

More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().