Rationality is a fundamental concept in economics. Most researchers will accept that human beings are not fully rational. Herbert Simon suggested that we are “bounded rational”. However, it is very difficult to quantify “bounded rationality”, and therefore it is difficult to pinpoint its impact to all those economic theories that depend on the assumption of full rationality. Ariel Rubinstein pr...

We report the results of an experiment designed to shed light on beliefs off equilibrium paths. The experiment implements an incomplete information club game. A unique outcome results in all perfect Bayesian equilibria, but beliefs and actions off the equilibrium path are unconstrained under all concepts except extensive form rationalizability (EFR) and logit equilibrium. 90% of subject’s decis...

one of the subjects which have long been obsessing the minds and spirits of deep-thinking believers is the relationship between religion in all aspects and scopes we can consider for it and the model of reason and rationality. the scope of religious studies is full of various and ever-emerging questions in this regard. there are diverse approaches to the relation between these two. adopting eac...

This paper will consider the relationship between complexity economics and behavioral economics. A crucial key to this is to understand that Herbert Simon was both the founder of explicitly modern behavioral economics as well as one of the early developers of complexity theory. Bounded rationality was essentially derived from Simon's view of the impossibility of full rationality on the part of ...

The market structure of platform competition is critically important to managers and policy makers. While network effects in these markets predict concentrated industry structures, competitive effects and differentiation suggest the opposite. Standard theory offers little guidance– full rationality models have multiple equilibria with wildly varying market concentration. We relax full rationali...

As an idea of learning and a mode of learning, e-learning dramatically highlights the subjectivity of the learners and make value rationality known. Meanwhile, value rationality appears damage and breaking in this process. Therefore, it is necessary to make learners fully exert subjective activity and intensify effective supervision on e-learning to construct e-learning and value rationality ha...

Bounded rationality has often been invoked in the theory of economic organization, mainly to rationalize contractual incompleteness. I argue that one may distinguish between " thin " and " thick " notions of bounded rationality; that models that rely on thin notions are often effectively indistinguishable from models that rely on full rationality; and that the value-added in terms of economic c...

D and normative modeling of decision making under risk and uncertainty have grown apart over the past decade. Psychological models attempt to accommodate the numerous violations of rationality axioms, including independence and transitivity. Meanwhile, normatively oriented decision analysts continue to insist on the applied usefulness of the subjective expected utility (SEU) model. As this gap ...

The importance of model uncertainties arising from different assumptions about human behavior as opposed to parameter uncertainty is often neglected in integrated models for policy development. In this study, so-called agent model uncertainty is estimated in relation to the choice of agent rationality. A classification scheme is proposed which allows us organize decision models according to the...

In this paper, we prove an approximation theorem for equilibrium problems and provide theoretical support for many algorithms. Simon's bounded rationality is illustrated by an approximation theorem, that is, bounded rationality is approaching full rationality as its ultimate goal. Furthermore, by the methods of set-valued analysis, we obtain the generic uniqueness and generic convergence of the...