Satisficing or Optimizing? - An Experimental Study
This experimental study investigates whether individuals prefer bounded rationality over rational choice theory when facing simple investment tasks. First, participants state some personal parameters that serve as an input to render a theoretical approach, namely satisficing or optimality, applicable. Then, they are guided through the decision making process where either ‘satisficing’ or ‘optimality’ is suggested and has to be implemented. The behavioral appeal of the two approaches is measured by the adjustments of personal parameters until accepting the investment decision suggested by theory. Additionally, a questionnaire is administered to elicit subjective contentment with the two approaches.
|Date of creation:||Jul 2006|
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References listed on IDEAS
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- Werner G, th & Bezalel Peleg, 2001. "When will payoff maximization survive? An indirect evolutionary analysis," Journal of Evolutionary Economics, Springer, vol. 11(5), pages 479-499.
- Werner Güth & Gerlinde Fellner & Ev Martin, 2006. "Task Transcending Satisficing - An Experimental Study," Papers on Strategic Interaction 2006-09, Max Planck Institute of Economics, Strategic Interaction Group.
- Gerlinde Fellner & Werner Güth & Boris Maciejovsky, 2005. "Satisficing in Financial Decision Making A Theoretical and Experimental Attempt to Explore Bounded Rationality," Papers on Strategic Interaction 2005-23, Max Planck Institute of Economics, Strategic Interaction Group.