Monday, September 29, 2008

Bounded Rationality

Karl Weick (1979, p 20) discusses the concept of bounded rationality, a concept that is applicable to communications and to information systems. Bounded rationality means that all of us have perceptual and information processing limits. We may always intend to act fully rational but usually we act on easy to get to knowledge, use undemanding rules to search for a conclusion, and take shortcuts whenever possible.

This implies that we need to assume that the decision makers in our communications or information systems may use limited rationality. They form attitudes and opinions, or make decisions in terms of familiar facts and abbreviated analyses.

Weick’s discussion of Bounded Rationality extends earlier work done by Simon (1960). Simon (pp 80-84) analyzes the limits of rationality. He finds that behavior is not objectively rational for three reasons:

  1. Rationality requires complete knowledge including the anticipated consequences
  2. Consequences are future events so impacts can only be imperfectly anticipated
  3. Even if all possible alternatives are known, it is unlikely the decision maker would be able to recall all of them in the decision making process

The needed abilities for objective rationality are at odds with the usual reality of fragmented knowledge. Objective rationality also runs counter to the devious consequences of indirect influences in a casual map. Finally, it is not reasonable to assume that all possible alternatives could be considered in a reasonable timeframe, even if they are known.

Simon concludes (p 108) that
“Human rationality operates, then, within the limits of a psychological environment. This environment imposes on the individual as ‘givens’ a selection of factors upon which he must make a decision.”
The implication of this, according to Simon, is that a deliberate control of the psychological environment can manipulate even “rational” choice or decision.

Simon, H.A. (1960). Administrative Behavior: A Study of Decision-Making Processes in Administrative Organization. Macmillan.

Weick, Karl (1979). The Social Psychology of Organizing, 2nd Edition. McGraw-Hill.

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