Deciding Not To Decide

Florian Ellsaesser and Guido Fioretti

MPRA Paper from University Library of Munich, Germany

Abstract: Sometimes unexpected, novel, unconceivable events enter our lives. The cause-effect mappings that usually guide our behaviour are destroyed. Surprised and shocked by possibilities that we had never imagined, we are unable to make any decision beyond mere routine. Among them there are decisions, such as making investments, that are essential for the long-term survival of businesses as well as the economy at large. We submit that the standard machinery of utility maximization does not apply, but we propose measures inspired by scenario planning and graph analysis, pointing to solutions being explored in machine learning.

Keywords: Uncertainty; Cognitive Maps; Machine Learning; Scenario Planning; Sense-Making; Bounded Rationality (search for similar items in EconPapers)
JEL-codes: C8 C81 D8 D81 (search for similar items in EconPapers)
Date: 2022-01-10
New Economics Papers: this item is included in nep-big, nep-cmp and nep-upt
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https://mpra.ub.uni-muenchen.de/112115/2/MPRA_paper_112115.pdf revised version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:111546

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