Journal of Economic Literature Vol. 51 No. 2 2013

Boundedly Rational versus Optimization-Based Models of Strategic Thinking and Learning in Games

Vincent P. Crawford

University of Oxford and All Souls College, Oxford, and University of California, San Diego.

Abstract

Harstad and Selten's article in this forum performs a valuable service by highlighting the dominance of optimization-based models over boundedly rational models in modern microeconomics, and questioning whether optimization-based models are a better way forward than boundedly rational models. This article complements Rabin's response to Harstad and Selten, focusing on modeling strategic behavior. I consider Harstad and Selten's examples and proposed boundedly rational models in the light of modern behavioral economics and behavioral game theory, commenting on the challenges that remain and the most promising ways forward.

DOI

10.1257/jel.51.2.512

Volume

51

Issue

2

Pages

512-527

Language

en

Sources

openalex crossref

Cite

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