bounded rationality

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The concept of bounded rationality keeps the concept of rationality from becoming practicably useless (Simon, 1957, pp 33-41). The essence of the notion is that individuals have perceptual as well as information-processing limits, and even though they may intend to act rationally, they can do so only in a limited fashion. This limited fashion consists of action on the basis of sufficient knowledge rather than complete knowledge (the concept of satisficing), ; of using simple, unlaborious rules to search for a solution when a problem arises (e.g., searching in the immediate vicinity of the problem); and of using shortcuts whenever possible. Weick, 1979, pp 20.

For the implication of bounded rationality on decision making see localized problem solving.