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Decomposition patterns in problem solving

Author

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  • Massimo Egidi

    (University of Trento)

Abstract

The paper develops a theory of biases in decision making. Discovering a strategy for solving a game is a complex problem that may be solved by decomposition; a player decomposing a problem into many simple sub- problems may easily identify the optimal solution to each sub-problem: however it is shown that even though all partial solutions are optimal, the solution to the global problem may be largely sub-optimal. The conditions under which a decomposition process gives rise to a sub- optimal solution are explored, and it is shown that the sub-optimalities ultimately originate from the process of categorization that governs the creation of a decomposition pattern. Decisions based on a strategy discovered by decomposition are therefore frequently biased . The persistence of biased behaviours, observed in many experiments, is explained by showing the stability of different and non optimal representations of the same problem. An application to a simplified version of Rubik cube is finally developed.

Suggested Citation

  • Massimo Egidi, 2003. "Decomposition patterns in problem solving," Experimental 0309003, University Library of Munich, Germany, revised 29 Sep 2003.
  • Handle: RePEc:wpa:wuwpex:0309003
    Note: Type of Document - Pdf; prepared on PC ; to print on PostScript; pages: 38 ; figures: included
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/exp/papers/0309/0309003.pdf
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    References listed on IDEAS

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    1. Egidi, Massimo & Narduzzo, Alessandro, 1997. "The emergence of path-dependent behaviors in cooperative contexts," International Journal of Industrial Organization, Elsevier, vol. 15(6), pages 677-709, October.
    2. Cohen, Michael D, et al, 1996. "Routines and Other Recurring Action Patterns of Organizations: Contemporary Research Issues," Industrial and Corporate Change, Oxford University Press, vol. 5(3), pages 653-698.
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    Cited by:

    1. Guido Fioretti, 2005. "Credit Rationing and Internal Ratings in the face of Innovation and Uncertainty," Finance 0504021, University Library of Munich, Germany.
    2. Massimo Egidi, 2012. "The Cognitive Explanation of Economic Behavior: From Simon to Kahneman," Chapters,in: Handbook of Knowledge and Economics, chapter 9 Edward Elgar Publishing.

    More about this item

    JEL classification:

    • C9 - Mathematical and Quantitative Methods - - Design of Experiments

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