MGHB02H3 Lecture Notes - Lecture 11: Bounded Rationality, Decision-Making, Rationality
Document Summary
Problem a perceived gap between an existing state and a desired state. A problem for which the existing state is clear, and how to get from one state to the other is fairly obvious. These problems are simple and their solutions arouse little controversy. Program a standardized way of solving a problem (rules, routines, standard operating procedures, or rules of thumb) A problem for which the existing and desired states are unclear and the method of getting to the desired state is unknown. Generally unique they are unusual and have not been encountered before. Frequently arouse controversy and conflict among the people who are interested in the decision. Gather more information and be more self-consciously analytical in their approach. The compleat decision maker a rational decision-making model. Perfect rationality a decision strategy that is completely informed, perfectly logical, and oriented toward economic gain. Information search clarifies the nature or extent of the problem and begin to suggest alternative solutions.
