Please use this identifier to cite or link to this item: http://hdl.handle.net/2381/43877
Title: Heuristics and Public Policy: Decision Making Under Bounded Rationality
Authors: Dhami, S
al-Nowaihi, A
Sunstein, C
First Published: 2019
Publisher: SAGE Publications (UK and US)
Citation: Studies in Microeconomics, 2019, In Press
Abstract: How do human beings make decisions when, as the evidence indicates, the assumptions of the Bayesian rationality approach in economics do not hold? Do human beings optimize, or can they? Several decades of research have shown that people possess a toolkit of heuristics to make decisions under certainty, risk, subjective uncertainty, and true uncertainty (or Knightian uncertainty). We outline recent advances in knowledge about the use of heuristics and departures from Bayesian rationality, with particular emphasis on growing formalization of those departures, which add necessary precision. We also explore the relationship between bounded rationality and libertarian paternalism, or nudges, and show that some recent objections, founded on psychological work on the usefulness of certain heuristics, are based on serious misunderstandings.
DOI Link: TBA
ISSN: 2321-0222
Links: TBA
http://hdl.handle.net/2381/43877
Embargo on file until: 1-Jan-10000
Version: Post-print
Status: Peer-reviewed
Type: Journal Article
Rights: Copyright © 2019, SAGE Publications (UK and US). Deposited with reference to the publisher’s open access archiving policy. (http://www.rioxx.net/licenses/all-rights-reserved)
Description: The file associated with this record is under embargo until publication, in accordance with the publisher's self-archiving policy. The full text may be available through the publisher links provided above.
Appears in Collections:Published Articles, School of Management

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