Bounded rationality concerns the study of decision makers with limited information processing resources. Previously, the free energy difference functional has been suggested to model bounded rational decision making, as it provides a natural trade-of...
In this paper, our purpose is to investigate the vector equilibrium problem of whether the approximate solution representing bounded rationality can converge to the exact solution representing complete rationality. An approximation theorem is proved...
As the country hosting the most significant number of refugees in Europe, Germany’s Merkel government’s refugee policy has been repeatedly adjusted and plagued by inconsistencies and management failures. What factors have influenced the f...
Personnel selection represents a two-sided matching problem in which firms compete for qualified candidates by designing job-offer packages. While traditional models assume fully rational agents, real-world decision-makers often face bounded rational...
Bounded rationality is an especially appropriate framework for organic dairy adoption decisions as it recognizes internal and external constraints which are critical in understanding complex farm decision making. Farmers use of, and access to, inform...
Customers’ bounded rationality significantly influences the effectiveness of advertising and related decision-making in customer-intensive services. This paper, based on the M/M/1 queuing model and incorporating the characteristics of customers...
This article applies the theoretical notion of “bounded rationality” to understand and to explain the updates of the Environmental Target Policy (ETP) in China during 1972–2016. An analytical framework is built up by combining the phase model and the...
A number of markets, geographically separated, with different demand characteristics for different products that share a common component, are analyzed. This common component can either be manufactured locally in each of the markets or transported be...
Amid rising global demand for renewable energy, geothermal power emerges as a vital, low-carbon solution to enhance energy security and sustainability. Taiwan, strategically located on the seismically active Pacific Ring of Fire, possesses an untappe...
Virtual power plants (VPPs) aggregate flexible resources, such as distributed photovoltaics (PV), energy storage, and flexible loads, to provide substantial reserve capacity for grid operation. However, the combined effects of renewable energy output...
When allocating study time for the English sections of the National College Entrance Examination or the Postgraduate Entrance Examination, learners often encounter value-test likelihood trade-offs, where questions of similar difficulty may have diffe...
18 February 2022
In the game of basketball game-related statistics are utilised to help decision makers to evaluate players’ achievements. Previous research showed that in the case of individual awards, points are preferred over other indicators of effectivenes...
The judgments of decision-makers are frequently the best way to process the information on complex alternatives. However, the performances of the alternatives are often not observable in their entirety, which prevents researchers from conducting cont...
In this paper, we allege that the hypothesis in favor of bounded rationality is a plausible explanation when it comes to better understanding the sluggish pace of adoption of best available tree crop farming techniques in poor small-scale rural commu...
As an essential component of China’s comprehensive transportation network, freeways play an irreplaceable role in promoting regional economic integration, improving logistics efficiency, and serving public travel. However, the development of fr...
The delays and disruptions during the pandemic have awakened interest in the sustainability and resilience of production systems to emergencies. In that context, the deployment of smart technologies has emerged as an almost mandatory development orie...
Game and decision theory start from rather strong premises. Preferences, represented by utilities, beliefs represented by probabilities, common knowledge and symmetric rationality as background assumptions are treated as “given.” A richer language en...
The bounded rationality mainstream is based on interesting experiments showing human behaviors violating classical probability (CP) laws. Quantum probability (QP) has been shown to successfully figure out such issues, supporting the hypothesis that q...
In order to study retailers’ ordering behavior deviating from the standard theoretical optimal decision, which is caused by retailers’ information asymmetry, cognitive ability, insufficient computing ability, and other factors, we constru...
The evolution of human cooperation is an important issue concerning social science. A deep understanding of human bounded rationality is a prerequisite for promoting collective cooperation and solving social dilemmas. Here we construct an asymmetric...
Industrial symbiosis network (ISN) is crucial to improving resource utilization efficiency and promoting sustainable development. In order to mitigate the damage caused to symbiotic systems by risk propagation, this paper constructs a directed weight...
Bounded rationality is an important consideration stemming from the fact that agents often have limits on their processing abilities, making the assumption of perfect rationality inapplicable to many real tasks. We propose an information-theoretic ap...
With the large-scale development of distributed energy on the demand side, the trend of “supply exceeding demand” has gradually become prominent, and regional peer-to-peer (P2P) energy trading has become an important measure to improve th...
In highway on-ramp sections, the conflictual interactions between a subject vehicle (merging vehicle) in the acceleration lane and a following vehicle (lagging vehicle) in the adjacent mainline can lead to traffic congestion, go–stop oscillatio...
With the development of techniques, such as the Internet of Things (IoT) and edge computing, home energy management systems (HEMS) have been widely implemented to improve the electric energy efficiency of customers. In order to automatically optimize...
In its most basic form, decision-making can be viewed as a computational process that progressively eliminates alternatives, thereby reducing uncertainty. Such processes are generally costly, meaning that the amount of uncertainty that can be reduced...
In this paper, we provide tight linear lower bounding functions for multivariate polynomials given over boxes. These functions are obtained by the expansion of polynomials into Bernstein basis and using the linear least squares function. Convergence...
Living organisms from single cells to humans need to adapt continuously to respond to changes in their environment. The process of behavioural adaptation can be thought of as improving decision-making performance according to some utility function. H...
We propose Adaptive Inference, a portfolio management framework extending Active Inference to non-stationary financial environments. The framework integrates inference, control, and execution under endogenous uncertainty, modeling investment decision...
A common misconception is that behavioral economics rejects microeconomics. This entry explains how behavioral economics, despite challenging core assumptions of rationality, remains fundamentally aligned with the structure of microeconomics. Anchore...
In a strategy-proof mechanism, implementation theory mostly assumes that each agent is rational in the sense that the agent reveals its true preference to induce its most preferred outcome. This assumption is sufficient to guarantee that the agent se...
Interdependent decisionmaking of individuals in social systems can be modelled by games played on complex networks. Players in such systems have bounded rationality, which influences the computation of equilibrium solutions. It has been shown that th...
As a new travel model, the bike-sharing system (BSS) solves the ‘last kilometer’ problem and has developed rapidly for its convenience. However, many accompanying problems have emerged. In China, parking violation problems—such as s...
Research on sustainability in the building sector currently focuses mainly on technical solutions while little attention is given to how behaviour influences the uptake of these solutions. Bounded rationality may have a significant impact on the effe...
This paper examines the computational feasibility of the standard model of learning in economic theory. It is shown that the information update technique at the heart of this model is impossible to compute in all but the simplest scenarios. Specifica...
Entropy plays a significant role in the study of games and economic behaviour in several ways. A decision maker faced with an n-fold repetition of a decision-making problem needs to apply strategies that become increasingly complex as n increases. Wh...
11 September 2019
In real life, garbage has caused great pollution to the environment. A garbage classification system is an effective way to manage this issue, and is an innovation in Shanghai, China. Innovation diffusion is the topic of this paper. This study uses a...
The characterization of Large Reasoning Models (LRMs) as exhibiting an “illusion of thinking” has recently emerged in the literature, sparking widespread public discourse. Some have suggested these manifestations represent bugs requiring...
This paper analyzes Cournot duopoly games that are constructed based on Cobb–Douglas preferences. We introduce here two models whose dynamic adjustments depend on bounded rationality, dynamic adjustment, and tit-for-tat mechanism. In the first...
We construct a New Keynesian (NK) behavioural macroeconomic model with bounded-rationality (BR) and heterogeneous agents. We solve and simulate the model using a third-order approximation for a given policy and evaluate its properties using this solu...
Life-threatening systemic fungal infections occur in immunocompromised patients at an alarming rate. Current antifungal therapies face challenges like drug resistance and patient toxicity, emphasizing the need for new treatments. Membrane-bound enzym...
Despite the unabated growth of algorithmic decision-making in organizations, there is a growing consensus that numerous situations will continue to require humans in the loop. However, the blending of a formal machine and bounded human rationality al...
27 March 2018
Chemical production activities in industrial districts pose great threats to the surrounding atmospheric environment and human health. Therefore, developing appropriate and intelligent pollution controlling strategies for the management team to monit...
Buy-low-sell-high is one of the basic rules of thumb used by individuals for investment, although it is not considered to be a constructive strategy. In this paper, we show how the appropriate representation of a minute-by-minute trading time series...
In this paper, we obtain a new simple rational approximation for
Shared parking improves the utilization rate of parking spaces by taking advantage of temporal and spatial differences, which is conducive to alleviating parking problems. From the perspective of bounded rationality, this paper studies the factors th...
We extend the agent-based models for knowledge diffusion in networks, restricted to random mindless interactions and to “frozen” (static) networks, in order to take into account intelligent agents and network co-evolution. Intelligent age...
This study aims to provide a more robust understanding of the elements involved in emergency managers’ decision-making processes when issuing hurricane evacuation orders. We used the principles of the theory of bounded rationality to formulate...
Over the last two decades, auctions have become an integral part of e-commerce and a promising field for applying artificial intelligence technologies. The use of signals has been studied extensively in the existing auction literature. Specifically,...
Reservation prices determine which goods consumers are willing to buy and, therefore, shape demand curves in markets. Neoclassical economics postulates that reservation prices optimally reflect the marginal utility provided by a good given all other...
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