Question

Herbert A. Simon (1916-2001) introduced the concept of “bounded rationality” to the study of decision making in public administration. He held that decision makers in public organizations were “intendedly rational,” but operated within a recognizable set of constraints. His argument generated decades of discussion and debate, initiating searches for systematic methods of decision-making and a theoretical model of problem solving in public administration.

Critically discuss the main arguments for Simon’s concept of bounded rationality, and the major constraints that affect human decision-making in administrative contexts.

Answer 1

ARGUMENTS FOR SIMON CONCEPT OF BOUNDED RATIONALITY

• In Bounded rationality is an Economist named ,  Herbert Simon's theory which states that, people are not inclined to gather all of the information required to make a decision.ationality , the manager seeks to adopt the rational approachable in decision making.
• it is a type of assumption or hypothesis that advice that there are boundaries to how rational a decision maker can actually be.
• If the decision factors do not trade with mankind, the probability of rationality increases.
• the below chart shows that , what actually happens through bounded rationality

• Managers make decisions rationally , they are humanbeings , so they are limited or bounded by their ability to process information.
• they may have to choose the first alternative encountered that will solve the problem safisfactorily , rather than maximise the outcome of their decision by considering all alternatives and choose the best
• take decisions only after simplifying the choices in variety of ways , its reason is that, the decision maker is a satisficer , he wants a satisfactory solution , rather than optimal solution with full of information.

constraints affect human decision making inadministrative contexts

• most consumers and businesses have not completed informations to make a good judgement when making their decisions.
• in bounded rationality , gives more importance to satisfaction , and not to optimal one.so it creates problem of incomplete answering
• not to be a valid solution.
• it says that consumers and businesses looks for only satisfaction , rather than maximise

the following chart shows the critical issue of this ,

• in administrative behaviour , boundedrationality is lragely characterized as a residual category
• rationality is bounded , when it falls short of omniscience.and the failureof omniscience are failure of knowing all alternatives, uncertainity about relevant exogenous events and inability to calculate consequences.
• only main two concepts discusses in bounded rationality are 1.search and 2. satisficing
• but satisficing willnot be adequate to our problem
• its one of the limit in decision making process
• they are forced to make decision that ar ejust good enough
• so this solution will be with imperfect information about them

CONCLUSION

Bounded rationality is good , its help for few searching and make decisions as they satisfice more.

not give emphasis on apt solution or optimal solution with full of information.so its not time consuming

but we can say that it gives priority only to theirs atisfaction , not to maximise in it.so we will get sub optimal solutions only.