This is the classic work upon which modern-day game theory is based. What began as a modest proposal that a mathematician and an economist write a short paper together blossomed, when Princeton University Press published Theory of Games and Economic Behavior. In it, John von Neumann and Oskar Morgenstern conceived a groundbreaking mathematical theory of economic and social organization, based on a theory of games of strategy. Not only would this revolutionize economics, but the entirely new field of scientific inquiry (...) it yielded--game theory--has since been widely used to analyze a host of real-world phenomena from arms races to optimal policy choices of presidential candidates, from vaccination policy to major league baseball salary negotiations. And it is today established throughout both the social sciences and a wide range of other sciences. (shrink)

To evaluate the success of simple heuristics we need to know more about how a relevant heuristic is chosen and how we learn which cues are relevant. These meta-abilities are at the core of ecological rationality, rather than the individual heuristics.

This article described three heuristics that are employed in making judgements under uncertainty: representativeness, which is usually employed when people are asked to judge the probability that an object or event A belongs to class or process B; availability of instances or scenarios, which is often employed when people are asked to assess the frequency of a class or the plausibility of a particular development; and adjustment from an anchor, which is usually employed in numerical prediction when a relevant value (...) is available. These heuristics are highly economical and usually effective, but they lead to systematic and predictable errors. A better understanding of these heuristics and of the biases to which they lead could improve judgements and decisions in situations of uncertainty. (shrink)

This article reviews the transition between post-Fregean anti-naturalistic epistemology and contemporary naturalistic epistemologies. It traces the revival of naturalism to Quine’s critique of the "a priori", and Kuhn’s defense of historicism, and use the arguments of Quine and Kuhn to identify a position, "traditional naturalism", that combines naturalistic themes with the claim that epistemology is a normative enterprise. Pleas for more radical versions of naturalism are articulated, and briefly confronted.

Humans and animals make inferences about the world under limited time and knowledge. In contrast, many models of rational inference treat the mind as a Laplacean Demon, equipped with unlimited time, knowledge, and computational might. Following H. Simon's notion of satisficing, the authors have proposed a family of algorithms based on a simple psychological mechanism: one-reason decision making. These fast and frugal algorithms violate fundamental tenets of classical rationality: They neither look up nor integrate all information. By computer simulation, the (...) authors held a competition between the satisficing "Take The Best" algorithm and various "rational" inference procedures. The Take The Best algorithm matched or outperformed all competitors in inferential speed and accuracy. This result is an existence proof that cognitive mechanisms capable of successful performance in the real world do not need to satisfy the classical norms of rational inference. (shrink)

This paper extends earlier work by its authors on formal aspects of the processes of contracting a theory to eliminate a proposition and revising a theory to introduce a proposition. In the course of the earlier work, Gardenfors developed general postulates of a more or less equational nature for such processes, whilst Alchourron and Makinson studied the particular case of contraction functions that are maximal, in the sense of yielding a maximal subset of the theory (or alternatively, of one of (...) its axiomatic bases), that fails to imply the proposition being eliminated. In the present paper, the authors study a broader class, including contraction functions that may be less than maximal. Specifically, they investigate "partial meet contraction functions", which are defined to yield the intersection of some nonempty family of maximal subsets of the theory that fail to imply the proposition being eliminated. Basic properties of these functions are established: it is shown in particular that they satisfy the Gardenfors postulates, and moreover that they are sufficiently general to provide a representation theorem for those postulates. Some special classes of partial meet contraction functions, notably those that are "relational" and "transitively relational", are studied in detail, and their connections with certain "supplementary postulates" of Gardenfors investigated, with a further representation theorem established. (shrink)

We present a new approach to the old problem of how to incorporate the role of the observer in statistics. We show classical probability theory to be inadequate for this task and take refuge in the epsilon-model, which is the only model known to us caapble of handling situations between quantum and classical statistics. An example is worked out and some problems are discussed as to the new viewpoint that emanates from our approach.

We analyze different aspects of our quantum modeling approach of human concepts and, more specifically, focus on the quantum effects of contextuality, interference, entanglement, and emergence, illustrating how each of them makes its appearance in specific situations of the dynamics of human concepts and their combinations. We point out the relation of our approach, which is based on an ontology of a concept as an entity in a state changing under influence of a context, with the main traditional concept theories, (...) that is, prototype theory, exemplar theory, and theory theory. We ponder about the question why quantum theory performs so well in its modeling of human concepts, and we shed light on this question by analyzing the role of complex amplitudes, showing how they allow to describe interference in the statistics of measurement outcomes, while in the traditional theories statistics of outcomes originates in classical probability weights, without the possibility of interference. The relevance of complex numbers, the appearance of entanglement, and the role of Fock space in explaining contextual emergence, all as unique features of the quantum modeling, are explicitly revealed in this article by analyzing human concepts and their dynamics. (shrink)

We show that it is impossible in quantum mechanics to describe two separated physical systems. This is due to the mathematical structure of quantum mechanics. It is possible to give a description of two separated systems in a theory which is a generalization of quantum mechanics and of classical mechanics, in the sense that this theory contains both theories as special cases. We identify the axioms of quantum mechanics that make it impossible to describe separated systems. One of these axioms (...) is equivalent to the superposition principle. We show how these findings throw a different light on the paradox of Einstein, Podolsky, and Rosen. (shrink)

Decision theory aims at a general account of rationality covering humans but to begin makes idealizations about decision problems and agents' resources and circumstances. It treats inerrant agents with unlimited cognitive power facing tractable decision problems. This book systematically rolls back idealizations and without loss of precision treats errant agents with limited cognitive abilities facing decision problems without a stable top option. It recommends choices that maximize utility using quantizations of beliefs and desires in cases where probabilities and utilities are (...) indeterminate and using higher-order utility analysis in cases of limited access to probabilities and utilities. For agents burdened with mistakes, it advocates reasonable attempts to correct unacceptable mistakes before deciding. In decision problems without a stable top option, a topic of game theory, it proposes maximizing self-conditional utility among self-supporting options. In games of strategy, the new principles lead to solutions that are Pareto optimal among equilibria composed of jointly self-supporting strategies. Offering an account of bounded rationality, the bookmakes large strides toward realism in decision theory. (shrink)

The thirty-five chapters in this book describe various judgmental heuristics and the biases they produce, not only in laboratory experiments but in important...

We outline the rationale and preliminary results of using the State Context Property (SCOP) formalism, originally developed as a generalization of quantum mechanics, to describe the contextual manner in which concepts are evoked, used, and combined to generate meaning. The quantum formalism was developed to cope with problems arising in the description of (1) the measurement process, and (2) the generation of new states with new properties when particles become entangled. Similar problems arising with concepts motivated the formal treatment introduced (...) here. Concepts are viewed not as fixed representations, but entities existing in states of potentiality that require interaction with a context---a stimulus or another concept---to `collapse' to observable form as an exemplar, prototype, or other (possibly imaginary) instance. The stimulus situation plays the role of the measurement in physics, acting as context that induces a change of the cognitive state from superposition state to collapsed state. The collapsed state is more likely to consist of a conjunction of concepts for associative than analytic thought because more stimulus or concept properties take part in the collapse. We provide two contextual measures of conceptual distance---one using collapse probabilities and the other weighted properties---and show how they can be applied to conjunctions using the pet fish problem. (shrink)

The sets of contexts and properties of a concept are embedded in the complex Hilbert space of quantum mechanics. States are unit vectors or density operators, and contexts and properties are orthogonal projections. The way calculations are done in Hilbert space makes it possible to model how context influences the state of a concept. Moreover, a solution to the combination of concepts is proposed. Using the tensor product, a procedure for describing combined concepts is elaborated, providing a natural solution to (...) the pet fish problem. This procedure allows the modeling of an arbitrary number of combined concepts. By way of example, a model for a simple sentence containing a subject, a predicate and an object, is presented. (shrink)