Satisficing: Integrating Two Traditions
- Journal of Economic Literature (Forthcoming)
In 1955, Herbert Simon introduced the notion of satisficing: an agent satisfices by searching for an alternative that meets an aspiration level but does not optimize. We survey more than 60 years of advances in understanding satisficing in economics, psychology, and management, identifying two research traditions that address two classes of situations: under risk, satisficing is typically inferior to optimization strategies and modeled according to the neoclassical framework; under uncertainty, satisficing strategies are often derived empirically and can be highly effective. We integrate the two research traditions and show the conditions under which satisficing can be rational.
Forthcoming Article Downloads