Ohio Investment Network


Recent Blogs


Pitching Help Desk


Testimonials

"For those of you that are asking yourself whether this site is real, the answer is yes. My first thought was that I would put my proposal on the site and it would be sent for review, and at this point someone from within the Dealflow Investment Network office would contact me as an investor so I would be more likely to pay the $249 fee. I received 8 responses from investors overnight and 2 more since then. Thanks Dealflow Investment Network."
David Kriedeman - Chris Christopherson Inc

 BLOG >> Recent

Simple Rules History [Agriculture
Posted on March 31, 2016 @ 11:15:00 AM by Paul Meagher

In my last blog I introduced the idea of simple rules and much of that blog focused on Herb Simon's thoughts on why simple rules are necessary (e.g., bounded rationality, limited cognitive capacity, pervasive uncertainty).

What can be confusing for people studying simple rules, or cognitive heuristics, is that you will encounter two different research programs on the use of heuristics in reasoning that offer different assessments on the value of heuristic reasoning.

One research program starts with Nobel laureate Herb Simon and his views on the importance of heuristics for achieving adaptation to the uncertain environment we find ourselves in. This could be called the "Ecological Rationality" research program.

Another research program starts with Nobel laureate Daniel Kahneman and his partner Amos Tversky and focuses on another aspect of heuristics, namely, that they can be fallible because when we use them we don't perform as well as normative rational models confronted with the same information. This could be called the "Heuristics and Biases" research program.

So in one research program (i.e., Ecological Rationality) you have heuristics portrayed as adaptive, and sometimes optimal, way to deploy our limited cognitive resources to address everyday uncertainties.

In another research program (i.e., Heuristics & Biases) heuristics are portrayed as a major source of fallacious reasoning that we might be able to correct by becoming aware of these heuristic biases.

These are very different ways to regard the value of heuristics and recent successful business books on behavioral economics have been more focused on showing the downsides to heuristics rather that the upsides. They teach us about heuristics so that we can be wary of supposedly common heuristic reasoning biases.

The notion of Simple Rules is potentially a way to avoid some of the baggage associated with the term heuristics but it is clearly a research program inspired by Herb Simon's framing of the role of heuristics in problem solving as more adaptive than flawed.

The book Simple Rules (2015) is an important contribution to the "Ecological Rationality" research program, especially as it pertains to business and entrepreneurial challenges. Always looming in the background when I read this stuff is the research program of Gerg Gigerenzer who has been one of the main torch bearer's for Herb Simon's bounded rationality research program. Their recent paper Heuristics as adaptive decision strategies in management (2014, PDF download) offers a nice account of how the Herb Simon research program has played out in the field of management.

So the point of this blog is to highlight the different influential research programs that have grown up around the notion of heuristic reasoning and which research program the Simple Rules approach best relates to (i.e., the bounded rationality or ecological rationality research programs). You can get very confused if you search out research on heuristics and you don't know this history.

It should also be noted, however, that in alot of the cognitive literature on heuristics these reasoning strategies are often viewed as baked into the hardware of our brains whereas Simple Rules are more like high level rules that we consciously formulate and chose to follow or not. They are also often more domain specific than the notion of cognitive heuristics is. There are interesting aspects of the Simple Rules notion that makes them not quite the same as the traditional notion of cognitive heuristics and that is one reason why the notion of Simple Rules potentially interests me - it may provide a more expanded way to account for productive competence in business than just relying upon Gerd's notion of fast and frugal reasoning strategies that are not as domain specific or consciously adopted.

I'll bring this discussion down to earth in my next blog when we discuss the use of Simple Rules as a way to approach thinking about how a business strategy should be formulated.

Permalink 

 Archive 
 

Archive


 November 2023 [1]
 June 2023 [1]
 May 2023 [1]
 April 2023 [1]
 March 2023 [6]
 February 2023 [1]
 November 2022 [2]
 October 2022 [2]
 August 2022 [2]
 May 2022 [2]
 April 2022 [4]
 March 2022 [1]
 February 2022 [1]
 January 2022 [2]
 December 2021 [1]
 November 2021 [2]
 October 2021 [1]
 July 2021 [1]
 June 2021 [1]
 May 2021 [3]
 April 2021 [3]
 March 2021 [4]
 February 2021 [1]
 January 2021 [1]
 December 2020 [2]
 November 2020 [1]
 August 2020 [1]
 June 2020 [4]
 May 2020 [1]
 April 2020 [2]
 March 2020 [2]
 February 2020 [1]
 January 2020 [2]
 December 2019 [1]
 November 2019 [2]
 October 2019 [2]
 September 2019 [1]
 July 2019 [1]
 June 2019 [2]
 May 2019 [3]
 April 2019 [5]
 March 2019 [4]
 February 2019 [3]
 January 2019 [3]
 December 2018 [4]
 November 2018 [2]
 September 2018 [2]
 August 2018 [1]
 July 2018 [1]
 June 2018 [1]
 May 2018 [5]
 April 2018 [4]
 March 2018 [2]
 February 2018 [4]
 January 2018 [4]
 December 2017 [2]
 November 2017 [6]
 October 2017 [6]
 September 2017 [6]
 August 2017 [2]
 July 2017 [2]
 June 2017 [5]
 May 2017 [7]
 April 2017 [6]
 March 2017 [8]
 February 2017 [7]
 January 2017 [9]
 December 2016 [7]
 November 2016 [7]
 October 2016 [5]
 September 2016 [5]
 August 2016 [4]
 July 2016 [6]
 June 2016 [5]
 May 2016 [10]
 April 2016 [12]
 March 2016 [10]
 February 2016 [11]
 January 2016 [12]
 December 2015 [6]
 November 2015 [8]
 October 2015 [12]
 September 2015 [10]
 August 2015 [14]
 July 2015 [9]
 June 2015 [9]
 May 2015 [10]
 April 2015 [9]
 March 2015 [8]
 February 2015 [8]
 January 2015 [5]
 December 2014 [11]
 November 2014 [10]
 October 2014 [10]
 September 2014 [8]
 August 2014 [7]
 July 2014 [5]
 June 2014 [7]
 May 2014 [6]
 April 2014 [3]
 March 2014 [8]
 February 2014 [6]
 January 2014 [5]
 December 2013 [5]
 November 2013 [3]
 October 2013 [4]
 September 2013 [11]
 August 2013 [4]
 July 2013 [8]
 June 2013 [10]
 May 2013 [14]
 April 2013 [12]
 March 2013 [11]
 February 2013 [19]
 January 2013 [20]
 December 2012 [5]
 November 2012 [1]
 October 2012 [3]
 September 2012 [1]
 August 2012 [1]
 July 2012 [1]
 June 2012 [2]


Categories


 Agriculture [77]
 Bayesian Inference [14]
 Books [18]
 Business Models [24]
 Causal Inference [2]
 Creativity [7]
 Decision Making [17]
 Decision Trees [8]
 Definitions [1]
 Design [38]
 Eco-Green [4]
 Economics [14]
 Education [10]
 Energy [0]
 Entrepreneurship [74]
 Events [7]
 Farming [21]
 Finance [30]
 Future [15]
 Growth [19]
 Investing [25]
 Lean Startup [10]
 Leisure [5]
 Lens Model [9]
 Making [1]
 Management [12]
 Motivation [3]
 Nature [22]
 Patents & Trademarks [1]
 Permaculture [36]
 Psychology [2]
 Real Estate [5]
 Robots [1]
 Selling [12]
 Site News [17]
 Startups [12]
 Statistics [3]
 Systems Thinking [3]
 Trends [11]
 Useful Links [3]
 Valuation [1]
 Venture Capital [5]
 Video [2]
 Writing [2]