Modern belief revision theory is based to a large extent on partial meet contraction that was introduced in the seminal article by Carlos Alchourrón, Peter Gärdenfors, and David Makinson that appeared in 1985. In the same year, Alchourrón and Makinson published a significantly different approach to the same problem, called safe contraction. Since then, safe contraction has received much less attention than partial meet contraction. The present paper summarizes the current state of knowledge on safe contraction, provides some new results (...) and offers a list of unsolved problems that are in need of investigation. (shrink)

The Intergovernmental Panel on Climate Change has developed a novel framework for assessing and communicating uncertainty in the findings published in their periodic assessment reports. But how should these uncertainty assessments inform decisions? We take a formal decision-making perspective to investigate how scientific input formulated in the IPCC’s novel framework might inform decisions in a principled way through a normative decision model.

While theories of rationality and decision making typically adopt either a single-powertool perspective or a bag-of-tricks mentality, the research program of ecological rationality bridges these with a theoretically-driven account of when different heuristic decision mechanisms will work well. Here we described two ways to study how heuristics match their ecological setting: The bottom-up approach starts with psychologically plausible building blocks that are combined to create simple heuristics that fit specific environments. The top-down approach starts from the statistical problem facing the (...) organism and a set of principles, such as the bias– variance tradeoff, that can explain when and why heuristics work in uncertain environments, and then shows how effective heuristics can be built by biasing and simplifying more complex models. We conclude with challenges these approaches face in developing a psychologically realistic perspective on human rationality. (shrink)

Standard evolutionary game theory investigates the evolutionary fitness of alternative behaviors in a fixed and single decision problem. This paper instead focuses on decision criteria, rather than on simple behaviors, as the general behavioral rules under selection in the population: the evolutionary fitness of classic decision criteria for rational choice is analyzed through Monte Carlo simulations over various classes of decision problems. Overall, quantifying the uncertainty in a probabilistic way and maximizing expected utility turns out to be evolutionarily beneficial in (...) general. Minimizing regret also finds some evolutionary justifications in our results, while maximin seems to be always disadvantaged by differential selection. (shrink)

How much irrationality should we ascribe to human cognition? Psychological evidence suggests that people’s reasoning is largely inaccurate, but according to an evolutionary argument for rationality, we have good reasons to believe that this is not so. To solve the conflict between psychological evidence and EAR, commentators have usually put the blame either on the psychological evidence, arguing that inaccurate reasoning appears only in the context of lab studies, or on the premises of EAR, charged with not being in line (...) with the concepts and findings of evolutionary biology. I argue that Hammond’s distinction between two distinct criteria of rationality, namely coherence and correspondence, might shed new light on this apparent conflict. I show that EAR might be interpreted in two different ways, and that EAR and psychological evidence might in fact be both correct if they appeal to different criteria of accurate reasoning. Moreover, evolutionary considerations have been recently used not to oppose the existence of violations of norms of coherence but rather to explain it. (shrink)

In this paper I scrutinize the “rational beliefs” in the concept of rationalizability in strategic games [Bernheim, Pearce ]. I illustrate through an example that a rationalizable strategy may not be supported by a “rational belief”, at least under one plausible interpretation of “rational belief”. I offer an alternative formulation of “rational belief” in the concept of rationalizability, which yields a novel epistemic interpretation of the notion of point-rationalizability.

Adaptive rationality theorists question the manner in which psychologists have typically assessed rational behavior and cognition. According to them, human rationality is adaptive, and the biases reported in the psychological literature are best seen as the result of using normative standards that are too narrow. As it turns out, their challenge is also quite controversial, and several aspects of it have been called into question. Yet, whilst it is often suggested that the lack of cogency comes about due to the (...) implausibility of the alternative normative framework, in this paper I articulate a different strategy to resist the revolutionary rhetoric of AR. As I argue here, even if we accept the normative framework of AR, the challenge from AR is less damaging than usually accepted. In particular, I challenge the claim that biases reported in the literature should be conceived of as violations of axiomatic rationality. I argue that the category of bias refers instead to a range of heterogeneous phenomena and that, since several important families of biases are not just violations of axiomatic rationality, these are not vulnerable to the AR challenge. In fact, I also show that the families I consider here look like plausible cases of irrational behavior from the perspective of AR, and that the outcome of my analysis does not sit well with AR theorists’ claim that people are generally successful at achieving prudential and epistemic goals. (shrink)

This paper focuses on the opposition between two contemporary research programs in economics: behavioral economics (BE) and experimental market economics (EME). Our claim is that the arguments of this opposition can be clarified through the lens of another opposition in the philosophy of probability and in probability theory, between Bayesianism and frequentism. We show how this probabilistic opposition has indirectly shaped a controversy in psychology that opposes two research programs – Heuristics and Biases and Ecological Rationality – which play respective (...) roles in the foundations of individual rationality in BE and EME. To understand these theoretical interrelationships, we investigate the 1996 controversy between Kahneman, Tversky, and Gigerenzer. Those psychologists held different views on how probabilistic representations influence the context-dependency of rationality. This provides a rationale to suggest that a probabilistic ghost may be haunting the experimental machine in economics, and explai.. (shrink)

It is argued that, contrary to a rather prevalent view within economic theory, rationality does not imply Bayesianism. The note begins by defining these terms and justifying the choice of these definitions, proceeds to survey the main justification for this prevalent view, and concludes by highlighting its weaknesses.

Do axiomatic derivations advance positive economics? If economists are interested in predicting how people behave, without a pretense to change individual decision making, how can they benefit from representation theorems, which are no more than equivalence results? We address these questions. We propose several ways in which representation results can be useful and discuss their implications for axiomatic decision theory.

I examine some behavioural and heuristic models of individual decision-making and argue that the diverse psychological mechanisms these models posit are too demanding to be implemented, either consciously or unconsciously, by actual decision makers. Accordingly, and contrary to what their advocates typically claim, behavioural and heuristic models are best understood as ‘as-if’ models. I then sketch a version of scientific antirealism that justifies the practice of as-if modelling in decision theory but goes beyond traditional instrumentalism. Finally, I relate my account (...) of decision models to the recent controversy about mentalism versus behaviourism, reject both positions, and offer an alternative view. (shrink)