Bounded Rationality and Satisficing (Behavioural Decision-Making Model)

Ms. Anandasrinivasan Deviprabha

Abstract

Two key ideas in behavioral decision-making models that go against the grain of rational decision-making are bounded rationality and satisfaction. We will examine the fundamentals of limited rationality and satisficing in this abstract, illuminating how these ideas have transformed our understanding of how people make decisions. The main characteristics, theoretical foundations, and practical applications of these models in diverse situations will be highlighted in the abstract. It will also go over how satisficing and limited rationality give a truer representation of human decision-making behavior by taking into consideration cognitive restrictions and environmental constraints that people confront in their daily decisions. The importance of limited rationality and satisficing in decision-making theories and its applicability in comprehending the complexity of human behavior will be better understood by readers after reading this abstract.