A Solution Concept Related to “Bounded Rationality” for Some Two-Echelon Models

2019 ◽  
pp. 465-486
Author(s):  
Joaquin Sanchez-Soriano ◽  
Natividad Llorca
2019 ◽  
Vol 21 (01) ◽  
pp. 1940005
Author(s):  
Joaquin Sanchez-Soriano ◽  
Natividad Llorca

Two-echelon models describe situations in which there are two differentiated groups of agents. Some examples of these models can be found in supply chain problems, transportation problems or two-sided markets. In this paper, we deal with two-sided transportation problems which can be used to describe a wide variety of logistic and market problems. We approach the problem from the perspective of cooperative games and study some solution concepts closely related to the game theoretical concept of core, but rather than focus specifically on the core of a transportation game, we introduce and study a new solution concept, a core catcher, which can be motivated by a kind of bounded rationality which can arise in these cooperative contexts.


2007 ◽  
Vol 38 (1) ◽  
pp. 45-64 ◽  
Author(s):  
NEIL MALHOTRA ◽  
MATTHEW E. CARNES

Acentral puzzle in the comparative politics literature has been why certain societies are able to achieve political stability while others suffer from strife, repression and authoritarian rule. This article applies the solution concept of quantal response equilibrium (QRE) to Weingast's Sovereign-Constituency Co-ordination Game in order to show how our understanding of political stability can be enhanced when uncertainty and limited rationality are explicitly modelled. Comparative statics results first confirm the intuitive logic that civil conflict is unlikely when regimes threaten penalties for revolt that are much more severe than current living conditions and when the benefits to a successful revolt are not sufficiently enticing. In addition, our analysis provides a logic for the outbreak of civil conflict, noting that it is most likely when key payoffs are in their intermediate regions and far from critical ‘thresholds’, resulting in ambiguous and counterintuitive decision making by leaders and citizen opposition groups.


1985 ◽  
Vol 30 (4) ◽  
pp. 263-265
Author(s):  
Donald E. Broadbent
Keyword(s):  

Author(s):  
Joshua M. Epstein

This part describes the agent-based and computational model for Agent_Zero and demonstrates its capacity for generative minimalism. It first explains the replicability of the model before offering an interpretation of the model by imagining a guerilla war like Vietnam, Afghanistan, or Iraq, where events transpire on a 2-D population of contiguous yellow patches. Each patch is occupied by a single stationary indigenous agent, which has two possible states: inactive and active. The discussion then turns to Agent_Zero's affective component and an elementary type of bounded rationality, as well as its social component, with particular emphasis on disposition, action, and pseudocode. Computational parables are then presented, including a parable relating to the slaughter of innocents through dispositional contagion. This part also shows how the model can capture three spatially explicit examples in which affect and probability change on different time scales.


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.


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