Bounded Rationality and Heuristics in Humans and in Artificial Cognitive Systems

In this paper I will present an analysis of the impact that the notion of “bounded rationality”, introduced by Herbert Simon in his book “Administrative Behavior”, produced in the field of Artificial Intelligence (AI). In particular, by focusing on the field of Automated Decision Making (ADM), I will show how the introduction of the cognitive dimension into the study of choice of a rational (natural) agent, indirectly determined - in the AI field - the development of a line of research aiming at the realisation of artificial systems whose decisions are based on the adoption of powerful shortcut strategies (known as heuristics) based on “satisficing” - i.e. non optimal - solutions to problem solving. I will show how the “heuristic approach” to problem solving allowed, in AI, to face problems of combinatorial complexity in real-life situations and still represents an important strategy for the design and implementation of intelligent systems

Cognition, institutions, near decomposability : rethinking Herbert Simon's contribution

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Herbert Simon's decision-making approach: Investigation of cognitive processes in experts

This is a post print version of the article. The official published can be obtained from the links below - PsycINFO Database Record (c) 2010 APA, all rights reserved.Herbert Simon's research endeavor aimed to understand the processes that participate in human decision making. However, despite his effort to investigate this question, his work did not have the impact in the “decision making” community that it had in other fields. His rejection of the assumption of perfect rationality, made in mainstream economics, led him to develop the concept of bounded rationality. Simon's approach also emphasized the limitations of the cognitive system, the change of processes due to expertise, and the direct empirical study of cognitive processes involved in decision making. In this article, we argue that his subsequent research program in problem solving and expertise offered critical tools for studying decision-making processes that took into account his original notion of bounded rationality. Unfortunately, these tools were ignored by the main research paradigms in decision making, such as Tversky and Kahneman's biased rationality approach (also known as the heuristics and biases approach) and the ecological approach advanced by Gigerenzer and others. We make a proposal of how to integrate Simon's approach with the main current approaches to decision making. We argue that this would lead to better models of decision making that are more generalizable, have higher ecological validity, include specification of cognitive processes, and provide a better understanding of the interaction between the characteristics of the cognitive system and the contingencies of the environment

Behavioural Economics: Classical and Modern

In this paper, the origins and development of behavioural economics, beginning with the pioneering works of Herbert Simon (1953) and Ward Edwards (1954), is traced, described and (critically) discussed, in some detail. Two kinds of behavioural economics – classical and modern – are attributed, respectively, to the two pioneers. The mathematical foundations of classical behavioural economics is identified, largely, to be in the theory of computation and computational complexity; the corresponding mathematical basis for modern behavioural economics is, on the other hand, claimed to be a notion of subjective probability (at least at its origins in the works of Ward Edwards). The economic theories of behavior, challenging various aspects of 'orthodox' theory, were decisively influenced by these two mathematical underpinnings of the two theoriesClassical Behavioural Economics, Modern Behavioural Economics, Subjective Probability, Model of Computation, Computational Complexity. Subjective Expected Utility

Expertise effects in memory recall: A reply to Vicente and Wang

This article may not exactly replicate the final version published in the APA journal. It is not the copy of record.In the January 1998 Psychological Review, Vicente and Wang propose a "constraint attunement hypothesis" to explain the large effects of domain expertise upon memory recall observed in a number of task domains. They claim to find serious defects in alternative explanations of these effects which their theory overcomes. Re-examination of the evidence shows that their theory is not novel, but has been anticipated by those they criticize, and that other current published theories of the phenomena do not have the defects Vicente and Wang attribute to them. Vicente and Wang's views reflect underlying differences (a) about emphasis upon performance versus process in psychology, and (b) about how theories and empirical knowledge interact and progress with the development of a science

Design thinking support: information systems versus reasoning

Numerous attempts have been made to conceive and implement appropriate information systems to support architectural designers in their creative design thinking processes. These information systems aim at providing support in very diverse ways: enabling designers to make diverse kinds of visual representations of a design, enabling them to make complex calculations and simulations which take into account numerous relevant parameters in the design context, providing them with loads of information and knowledge from all over the world, and so forth. Notwithstanding the continued efforts to develop these information systems, they still fail to provide essential support in the core creative activities of architectural designers. In order to understand why an appropriately effective support from information systems is so hard to realize, we started to look into the nature of design thinking and on how reasoning processes are at play in this design thinking. This investigation suggests that creative designing rests on a cyclic combination of abductive, deductive and inductive reasoning processes. Because traditional information systems typically target only one of these reasoning processes at a time, this could explain the limited applicability and usefulness of these systems. As research in information technology is increasingly targeting the combination of these reasoning modes, improvements may be within reach for design thinking support by information systems

Computation in Economics

This is an attempt at a succinct survey, from methodological and epistemological perspectives, of the burgeoning, apparently unstructured, field of what is often – misleadingly – referred to as computational economics. We identify and characterise four frontier research fields, encompassing both micro and macro aspects of economic theory, where machine computation play crucial roles in formal modelling exercises: algorithmic behavioural economics, computable general equilibrium theory, agent based computational economics and computable economics. In some senses these four research frontiers raise, without resolving, many interesting methodological and epistemological issues in economic theorising in (alternative) mathematical modesClassical Behavioural Economics, Computable General Equilibrium theory, Agent Based Economics, Computable Economics, Computability, Constructivity, Numerical Analysis