Against an uncritical sense of adaptiveness

2000 ◽  
Vol 23 (5) ◽  
pp. 750-751
Author(s):  
Steve Fuller

The “adaptive toolbox” model of the mind is much too uncritical, even as a model of bounded rationality. There is no place for a “meta-rationality” that questions the shape of the decision-making environments themselves. Thus, using the ABC Group's “fast and frugal heuristics,” one could justify all sorts of conformist behavior as rational. Telling in this regard is their appeal to the philosophical distinction between coherence and correspondence theories of truth.

2020 ◽  
Author(s):  
Igor Grossmann ◽  
Richard Eibach

Previous theory and research on bounded rationality has emphasized how limited cognitive resources constrain people from making utility maximizing choices. This paper expands the concept of bounded rationality to consider how people’s rationality may be constrained by their internalization of a qualitatively distinct standard for sound judgment, which is commonly labeled reasonableness. In contrast to rationality, the standard of reasonableness provides guidance for making choices in situations that involve balancing incommensurable values and interests or reconciling conflicting points-of-view. We review recent evidence showing that laypeople readily recognize the distinctions between rationality and reasonableness and thus are able to utilize these as distinct standards to inform their everyday decision-making. The fact that people appear to have internalized rationality and reasonableness as distinct standards of sound judgment supports the notion that people’s pursuit of rationality may be bounded by their determination to also be reasonable.


2020 ◽  
Author(s):  
Luca Rade

Emulators are internal models, first evolved for prediction in perception to shorten the feedback on motor action. However, the selective pressure on perception is to improve the fitness of decision-making, driving the evolution of emulators towards context-dependent payoff representation and integration of action planning, not enhanced prediction as is generally assumed. The result is integrated perceptual, memory, representational, and imaginative capacities processing external input and stored internal input for decision-making, while simultaneously updating stored information. Perception, recall, imagination, theory of mind, and dreaming are the same process with different inputs. Learning proceeds via scaffolding on existing conceptual infrastructure, a weak form of embodied cognition. Discrete concepts are emergent from continuous dynamics and are in a perceptual, not representational, format. Language is also in perceptual format and enables precise abstract thought. In sum, what was initially a primitive system for short-term prediction in perception has evolved to perform abstract thought, store and retrieve memory, understand others, hold embedded action plans, build stable narratives, simulate scenarios, and integrate context dependence into perception. Crucially, emulators co-evolved with the emergence of societies, producing a mind-society system in which emulators are dysfunctional unless integrated into a society, which enables their complexity. The Target Emulator System, evolved initially for honest signaling, produces the emergent dynamics of the mind-society system and spreads variation-testing of behavior and thought patterns across a population. The human brain is the most dysfunctional in isolation, but the most effective given its context.


Author(s):  
Peter M. Todd ◽  
Gerd Gigerenzer

The study of situations involves asking how people behave in particular environmental settings, often in terms of their individual personality differences. The ecological rationality research program explains people’s behavior in terms of the specific decision-making tools they select and use from their mind’s adaptive toolbox when faced with specific types of environment structure. These two approaches can be integrated to provide a more precise mapping from features of situation structure to decision heuristics used and behavioral outcomes. This chapter presents three examples illustrating research on ecological rationality and its foundations, along with initial directions for incorporating it into an integrated situation theory.


2021 ◽  
pp. 1-38
Author(s):  
Yingya Jia ◽  
Anne S. Tsui ◽  
Xiaoyu Yu

ABSTRACT Optimal or rational decision making is not possible due to informational constraints and limits in computation capability of humans (March & Simon, 1958; March, 1978). This bounded rationality serves as a filtering process in decision making among business executives (Hambrick & Mason, 1984). In this study, we propose the concept of CEO reflective capacity as a behavior-oriented cognitive capability that may overcome to some extent the pervasive limitation of bounded rationality in executive decision-making. Following Hinkin's (1998) method and two executive samples, we developed and validated a three-dimensional measure of CEO reflective capacity. Based on two-wave surveys of CEOs and their executive-subordinates in 213 Chinese small-medium sized firms, we tested and confirmed three hypotheses on how CEO reflective capacity is related to a firm's sustainability performance (including economic, societal, and environmental dimensions) through the mediating mechanisms of strategic decision comprehensiveness and CEO behavioral complexity. We discuss the contribution of this study to the literature on the upper echelons and information processing perspectives. We also identify the implications for future research on strategic leadership and managerial cognition in complex and dynamic contexts.


2016 ◽  
Author(s):  
Falk Lieder ◽  
Tom Griffiths

Many contemporary accounts of human reasoning assume that the mind is equipped with multiple heuristics that could be deployed to perform a given task. This raises the question how the mind determines when to use which heuristic. To answer this question, we developed a rational model of strategy selection, based on the theory of rational metareasoning developed in the artificial intelligence literature. According to our model people learn to efficiently choose the strategy with the best cost-benefit tradeoff by learning a predictive model of each strategy’s performance. We found that our model can provide a unifying explanation for classic findings from domains ranging from decision-making to problem-solving and arithmetic by capturing the variability of people’s strategy choices, their dependence on task and context, and their development over time. Systematic model comparisons supported our theory, and four new experiments confirmed its distinctive predictions. Our findings suggest that people gradually learn to make increasingly more rational use of fallible heuristics. This perspective reconciles the two poles of the debate about human rationality by integrating heuristics and biases with learning and rationality.


2019 ◽  
Vol 9 (9(5)) ◽  
pp. 557-576 ◽  
Author(s):  
Maria Gendron ◽  
Lisa Feldman Barrett

Emotions are traditionally viewed as detrimental to judicial responsibility, a belief rooted in the classical view of the mind as a battle ground between reason and emotion. Drawing on recent developments in psychology and neuroscience we propose that the brain uses past experience, organized as concepts, to guide actions and give sensations meaning, constructing experiences such as “fear” or “anger”. Wisdom comes from skill at constructing emotions in a more precise and functional way, a skill called “emotional granularity”. Studies show that individuals who are more emotionally granular have better function across a range of domains, including self regulation and decision making. We propose that effective judicial decision-making does not require a dispassionate judge, but a judge who is high in emotional granularity. We lay out an empirical agenda for testing this idea and end by discussing empirically supported recommendations for increasing emotional granularity in the judiciary. Tradicionalmente, se ha considerado que las emociones son perjudiciales para el desempeño responsable de la labor judicial, una creencia enraizada en la concepción clásica de la mente como campo de batalla entre razón y emoción. Partiendo de nuevos descubrimientos en psicología y neurociencia, argumentamos que el cerebro usa la experiencia pasada, organizada como conceptos, para guiar las acciones y dar sentido a las sensaciones, construyendo experiencias como “miedo” o “ira”. La sabiduría proviene de la habilidad en construir emociones de un modo más preciso y funcional, habilidad denominada “granularidad emocional”. Los estudios muestran que los individuos más granulares emocionalmente funcionan mejor en varios dominios, incluyendo la autorregulación y la toma de decisiones. Argumentamos que la toma de decisiones eficaz en judicatura no requiere de un juez desapasionado, sino de un juez que tenga alta granularidad emocional. Proponemos un programa empírico para poner a prueba esa idea, y concluimos con un debate de recomendaciones de base empírica para aumentar la granularidad emocional en la judicatura.


2021 ◽  
Vol 129 ◽  
pp. 02010
Author(s):  
Renata Legenzova ◽  
Gintarė Leckė

Research background: Globalization, digitalization and growth of technological innovations trigger development of new financial services, such as real estate crowdfunding. Seeking better return opportunities individual investors often disregard neoclassical decision-making criteria, while behavioral factors, such as social influence, emotions, cognitive abilities are gaining importance. This paper addresses the role of family economics socialization as a complex process by which individuals acquire social skills, knowledge, behavior patterns needed to make investment decision by purposively or spontaneously interacting with their family members. Purpose of the article is to assess if and how family economic socialization impacts on investor behavior in real estate crowdfunding. Methods: Research data was collected through an online survey of Lithuanian real estate crowdfunding investors. Then structural equation modeling technique was employed to investigate the impact of family economic socialization on behavior of real estate crowdfunding investors. Findings & Value added: Findings revealed that majority of real estate crowdfunding investors make bounded rationality investment decisions. Family, as one of the main agents of the economic socialization, does not ensure rationality of the crowdfunding decision-making process. Purposive family economic socialization has no impact on the behavior of investors with bounded rationality, yet it has a significant impact on behavior of rational family members. Spontaneous family economic socialization proved to have a positive and significant impact on the behavior of investors with bounded rationality. Taking into consideration rapid global development of innovative financial services market, such results might be a troubling signal for the product developers and market regulators.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kirsten Rauwerda ◽  
Frank Jan De Graaf

PurposeIn order to better understand how heuristics are used in practice, the authors explore what type of heuristics is used in the managerial domain of financial advisors to small and medium-sized enterprises (SMEs) and what influences the shaping of these heuristics. In doing so, the authors detect possible fast-and-frugal heuristics in day-to-day decision-making of independent financial advisers who help owners of SMEs to acquire capital (e.g. loans, factoring, leasing and equity).Design/methodology/approachThe authors inductively assessed the work of financial advisers of SMEs. Based on group discussions, the authors drew up a semi-structured interview-protocol with descriptive questions about how financial advisers come to a deal for their clients. The interviews of 19 professionals were analysed by relating them to the theory of fast-and-frugal heuristics.FindingsWithin their decision-making, advisers estimate the likelihood of acceptance by a few financial providers they know well in their personal network with a strong bias towards traditional banking products, although there are a large number of alternatives on the Dutch market. “Less is more” seems to be a relevant principle when defined as satisficing. Heuristics help advisers to deal with behavioural and economic limitations. Also, the authors have found that client interaction, previous working experience and the company the adviser is working for influences the shaping of the simple rules the adviser is using.Research limitations/implicationsThe study shows how difficult it is to understand the ecological rationality of a certain group of professionals and to understand the “less is more” principle. Financial advisers to SMEs use cognitive shortcuts and simple rules to advise SME-owners, based on previous experiences, but it is difficult to determine whether that leads to the same or even better solutions for them and their clients than using probability theory and financial optimisation models. Within heuristics, satisficing seems to be a dominant mechanism. Here, heuristics help advisers in recognising possibilities by searching for similarities between a current financing case and previous experiences. The data suggests that if “less is more” is defined as satisficing for one or more stakeholders involved, the principle dominates the decision making of financial advisers of SME's.Practical implicationsThe authors suggest the relevance of a behavioural approach to finance by assessing the day-to-day decisions of financial advisers of SMEs. Also, the authors suggest that financial advisers are guided by previous experiences, and they do not fully assess a wide range of options in their work but need shortcuts to fulfil the needs of their clients.Originality/valueThe study comes close to day-to-day decision-making in finance by assessing how professionals make decisions. The authors try to understand types of heuristics in relation with “ecological rationality” and the less is more principle. The authors assess financial advisers of SME-companies, a group that has gotten little research attention until now. The influence of client interaction and of the company the adviser is working for is remarkable in the shaping of the advisers' simple rules.


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