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Bounded rationality and decision-making in complex systems

Author

Listed:
  • Tatiana Massaroli Melo
  • José Ricardo Fucidji

Abstract

This article aims to present the behavioral model of bounded rationality proposed by Herbert Simon as a framework to analyze the process of decision-making of agents in complex systems, characterized by non-ergodicity and developing open trajectories. The article presents the notion of logically consistent choice and contrasts it with the axiomatic analysis of the neoclassical theory. It argues for the use of computer simulation models, like agent-based modeling (ABM) as a suitable tool for analyzing complex systems. JEL Classification: B41; B52.

Suggested Citation

  • Tatiana Massaroli Melo & José Ricardo Fucidji, 2016. "Bounded rationality and decision-making in complex systems," Brazilian Journal of Political Economy, Center of Political Economy, vol. 36(3), pages 622-645.
    • Handle: RePEc:ekm:repojs:v:36:y:2016:i:3:p:622-645:id:199
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    File URL: https://centrodeeconomiapolitica.org.br/repojs/index.php/journal/article/view/199/190
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    More about this item

    Keywords

    bounded rationality; complex systems; simulation models;
    All these keywords.

    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;

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