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Bounded rationality, cognitive maps, and trial and error learning

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  • Nelson, Richard R.

Abstract

The term "bounded rationality" is used here to connote the reasoning capabilities of an actor who, on the one hand, has a goal to achieve and an at least partially formed theory as to how to achieve it, and on the other hand, that the theory is somewhat crude, likely will be revised in the course of the effort, and that success is far from assured. This article presents a theory of how trial and error learning interact with theory modification in the course of problem solving under bounded rationality. The empirical focus is on efforts to advance a technology, especially medical practice, but the analysis is quite general. A central question explored is what makes progress in a field hard or easy.

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  • Nelson, Richard R., 2008. "Bounded rationality, cognitive maps, and trial and error learning," Journal of Economic Behavior & Organization, Elsevier, vol. 67(1), pages 78-89, July.
    • Handle: RePEc:eee:jeborg:v:67:y:2008:i:1:p:78-89
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    8. Muñoz, Félix & Encinar, María Isabel, 2007. "Action Plans and Socio-Economic Evolutionary Change," Working Papers in Economic Theory 2007/07, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History).
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