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Title:Cognitive constraints, contraction consistency, and the satisficing criterion PDF Logo
Authors:Tyson, Christopher J.
Issue Date:2007
Series/Report no.:Working Paper, Department of Economics, Queen Mary, University of London 614
Abstract:A theory of decision making is proposed that offers an axiomatic basis for the notion of satisficing postulated by Herbert Simon. The theory relaxes the standard assumption that the decision maker always fully perceives his preferences among the available alternatives, requiring instead that his ability to perceive any given preference be decreasing with respect to the complexity of the choice problem at hand. When complexity is aligned with set inclusion, this exercise is shown to be equivalent to abandoning the contraction consistency axiom of classical choice theory.
Subjects:Choice function
Perception
Revealed preference
Threshold
JEL:D01
D11
D80
Document Type:Working Paper
Appears in Collections:Working Paper Series, School of Economics and Finance, Queen Mary, University of London

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