IDEAS home Printed from https://ideas.repec.org/p/esi/discus/2004-27.html
   My bibliography  Save this paper

Bounded Rationality and Theory Absorption

Author

Listed:
  • Werner Güth
  • Hartmut Kliemt

Abstract

In plausible theories of bounded rationality actors are not stimulus-response machines but human beings. As such they are guided by theories that predict the course of the world and prescribe how they should try to intervene in that course. Since boundedly rational human beings cannot only observe but can also modify their theories, in particular if they are not satisfied with the results, a self-application of concepts of boundedly rational behavior to theory choice and an inquiry of theory absorption seems natural. The paper explores by means of specific examples some issues that are raised by combining the concept of satisficing behavior with that of theory absorption.

Suggested Citation

  • Werner Güth & Hartmut Kliemt, 2004. "Bounded Rationality and Theory Absorption," Papers on Strategic Interaction 2004-27, Max Planck Institute of Economics, Strategic Interaction Group.
    • Handle: RePEc:esi:discus:2004-27
    as

    Download full text from publisher

    File URL: ftp://papers.econ.mpg.de/esi/discussionpapers/2004-27.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Akerlof,George A., 1984. "An Economic Theorist's Book of Tales," Cambridge Books, Cambridge University Press, number 9780521269339, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Siegfried Berninghaus & Werner Güth & M. Levati & Jianying Qiu, 2011. "Satisficing search versus aspiration adaptation in sales competition: experimental evidence," International Journal of Game Theory, Springer;Game Theory Society, vol. 40(1), pages 179-198, February.
    2. Güth, Werner & Vittoria Levati, M. & Ploner, Matteo, 2010. "Satisficing in strategic environments: A theoretical approach and experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 39(5), pages 554-561, October.
    3. Grohn, Jan & Huck, Steffen & Valasek, Justin Mattias, 2014. "A note on empathy in games," Journal of Economic Behavior & Organization, Elsevier, vol. 108(C), pages 383-388.
    4. Siegfried Berninghaus & Werner Güth & M. Vittoria Levati & Jianying Qiu, 2006. "Satisficing in sales competition: experimental evidence," Papers on Strategic Interaction 2006-32, Max Planck Institute of Economics, Strategic Interaction Group.
    5. Sandri, Serena & Schade, Christian & Mußhoff, Oliver & Odening, Martin, 2010. "Holding on for too long? An experimental study on inertia in entrepreneurs' and non-entrepreneurs' disinvestment choices," Journal of Economic Behavior & Organization, Elsevier, vol. 76(1), pages 30-44, October.
    6. Lehmann-Waffenschmidt, Marco & Sandri, Serena, 2007. "Recursivity and Self-Referentiality of Economic Theories and Their Implications for Bounded Rational Actors," Dresden Discussion Paper Series in Economics 03/07, Technische Universität Dresden, Faculty of Business and Economics, Department of Economics.
    7. Morone, Andrea & Sandri, Serena & Fiore, Annamaria, 2009. "On the absorbability of informational cascades in the laboratory," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(5), pages 728-738, October.
    8. Andrea Morone & Serena Sandri & Tobias Uske, 2006. "On the absorbability of the Guessing Game Theory - A Theoretical and Experimental Analysis," Papers on Strategic Interaction 2006-33, Max Planck Institute of Economics, Strategic Interaction Group.
    9. Werner Güth, 2006. "Satisficing in Portfolio Selection - Theoretical Aspects and Experimental Tests," Papers on Strategic Interaction 2006-16, Max Planck Institute of Economics, Strategic Interaction Group.
    10. Lehmann-Waffenschmidt, Marco, 2006. "Self-Referential Optimal Advising When Reactions are Delayed," Dresden Discussion Paper Series in Economics 06/06, Technische Universität Dresden, Faculty of Business and Economics, Department of Economics.
    11. Guido Ferilli & Pier Luigi Sacco & Massimo Buscema & Giorgio Tavano Blessi, 2015. "Understanding Cultural Geography as a Pseudo-Diffusion Process: The Case of the Veneto Region," Economies, MDPI, vol. 3(2), pages 1-28, June.
    12. Werner Güth & M. Vittoria Levati & Matteo Ploner, 2006. "Is Satisficing Absorbable? - An Experimental Study," Papers on Strategic Interaction 2006-10, Max Planck Institute of Economics, Strategic Interaction Group.
    13. Güth, Werner, 2010. "Satisficing and (un)bounded rationality--A formal definition and its experimental validity," Journal of Economic Behavior & Organization, Elsevier, vol. 73(3), pages 308-316, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Monika Janičíková, 2014. "Asymmetric information within Initial Public Offerings [Asymetrická informace při primárních emisích akcií]," Český finanční a účetní časopis, Prague University of Economics and Business, vol. 2014(2), pages 81-91.
    2. Stefano Scarpetta, 2014. "Employment protection," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-12, May.
    3. Olivier Favereau, 1989. "Marchés internes, marchés externes," Revue Économique, Programme National Persée, vol. 40(2), pages 273-328.
    4. Pranab Bardhan, 2005. "Institutions matter, but which ones?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 13(3), pages 499-532, July.
    5. Samuel Cameron, 2002. "The Economics Of Partner Out Trading in Sexual Markets," Journal of Bioeconomics, Springer, vol. 4(3), pages 195-222, October.
    6. Bénédicte Reynaud, 1993. "Les théories de l'équité, fondements d'une approche cognitive du salaire d'efficience," Revue Économique, Programme National Persée, vol. 44(1), pages 5-22.
    7. Pranab Bardhan, 1991. "On The Concept Of Power In Economics," Economics and Politics, Wiley Blackwell, vol. 3(3), pages 265-277, November.
    8. Cazes, Sandrine & Tonin, Mirco, 2009. "Employment protection legislation and job stability: an European cross country analysis," Discussion Paper Series In Economics And Econometrics 902, Economics Division, School of Social Sciences, University of Southampton.
    9. H. Visser, 1998. "The Microeconomics of Money and Finance: A Survey," South African Journal of Economics, Economic Society of South Africa, vol. 66(1), pages 10-20, March.
    10. Kirsten Foss, 1996. "A Transaction cost Perspective on the Influence of Standards on Product Development Examples from the Fruit and Vegetable Market," DRUID Working Papers 96-9, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    11. Bruno Contini & Matteo Morini, 2007. "Econometric Explorations on Bounded Rationality: The Case of Job Changing Behavior," LABORatorio R. Revelli Working Papers Series 55, LABORatorio R. Revelli, Centre for Employment Studies.
    12. Ashwini Deshpande, 2002. "Assets versus Autonomy? The Changing Face of the Gender-Caste Overlap in India," Feminist Economics, Taylor & Francis Journals, vol. 8(2), pages 19-35.
    13. Corinne Duverger, 1993. "Altruism and the "metaphorical model" [Altruisme et modèle métaphorique]," Working Papers hal-01527278, HAL.
    14. de Janvry, Alain & Sadoulet, Elisabeth, 2004. "Fitting the Facts and Capitalizing on New Opportunities to Redesign Rural Development Programs in Latin America," Revista de Economia e Sociologia Rural (RESR), Sociedade Brasileira de Economia e Sociologia Rural, vol. 42(3), January.
    15. Eran Binenbaum, 2005. "Towards a Relational Economics: Methodological Comments on Intellectual Property Strategy, Industrial Organisation, and Economics," Method and Hist of Econ Thought 0502001, University Library of Munich, Germany.
    16. Mate Domician, 2014. "The Impact Of Labour Market Institutions On Productivity In A Sectoral Approach," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 359-368, July.
    17. Amegashie, J.A., 2002. "Misery Loves Company: Social Influence and the Supply/Pricing Decision of Popular Night Clubs," Working Papers 2002-10, University of Guelph, Department of Economics and Finance.
    18. Contini, Bruno & Morini, Matteo, 2007. "Testing Bounded Rationality against Full Rationality in Job Changing Behavior," IZA Discussion Papers 3148, Institute of Labor Economics (IZA).
    19. Dosi, Giovanni & Nelson, Richard R., 2010. "Technical Change and Industrial Dynamics as Evolutionary Processes," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 1, chapter 0, pages 51-127, Elsevier.
    20. Ellerman, David, 2001. "Helping people help themselves - toward a theory of autonomy-compatible help," Policy Research Working Paper Series 2693, The World Bank.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:esi:discus:2004-27. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Karin Richter (email available below). General contact details of provider: https://edirc.repec.org/data/mpiewde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.