Review:
Bounded Rationality
overall review score: 4
⭐⭐⭐⭐
score is between 0 and 5
Bounded rationality is the idea that individuals do not always make fully rational decisions due to cognitive limitations, time constraints, and information overload.
Key Features
- Limited processing capacity
- Incomplete information
- Time constraints
- Satisficing (choosing a satisfactory option rather than the optimal one)
Pros
- Recognizes human limitations in decision-making
- Provides a more realistic model of behavior than strict rationality
Cons
- May lead to suboptimal decisions
- Can be difficult to quantify or measure