MGHD27H3 Lecture Notes - The Persians, Satisficing, Groupthink
Document Summary
Perfect rationality the assumption that decision making is an entirely rational process and that the decision maker is perfectly informed with all necessary information, is perfectly logical and is not influenced in any way by emotional issues. The soul orientation of the decision maker is economic gain. Bounded rationality more closely reflects real world decision making. Decision makers have limited information, limited time and are influenced by emotional and political considerations. Framing how a problem is viewed eg. focus on the risks of a bad decision or focus on the rewards of a good decision. When we frame a problem as a choice between losses, we tend to make risky decisions. When we frame alternatives as choices between gains, we tend to make conservative decisions (kahneman and tversky) Confirmation bias the tendency to seek out information that conforms with our own definition of or solution to the problem.
