Heuristics as Plausible Models of Rationality?

Reich, Wendelin

doi:10.1080/00016990050156701

Cited by 3 publications

(1 citation statement)

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“…Reich (2000), reviewing the work of German social theorist Gerd Gigerenzer, argues that ''yrules for decision and action may well be grounded on simplifying and biased assumptions and lead to incoherent results-in short, these rules may be heuristical algorithms instead of determinable algorithmsy.' ' Kahneman (2002) argues that such shortcuts are the normal way of making decisions (even among experts) and that calculated rationality occurs only as a deliberate override to such heuristic-or in his terms, intuitive-practices.…”

Section: Article In Pressmentioning

confidence: 99%

Car buyers and fuel economy?

2007

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This research is designed to help researchers and policy makers ground their work in the reality of how US consumers are thinking and behaving with respect to automotive fuel economy. Our data are from semi-structured interviews with 57 households across nine lifestyle ''sectors.'' We found no household that analyzed their fuel costs in a systematic way in their automobile or gasoline purchases. Almost none of these households track gasoline costs over time or consider them explicitly in household budgets. These households may know the cost of their last tank of gasoline and the unit price of gasoline on that day, but this accurate information is rapidly forgotten and replaced by typical information. One effect of this lack of knowledge and information is that when consumers buy a vehicle, they do not have the basic building blocks of knowledge assumed by the model of economically rational decision-making, and they make large errors estimating gasoline costs and savings over time.Moreover, we find that consumer value for fuel economy is not only about private cost savings. Fuel economy can be a symbolic value as well, for example among drivers who view resource conservation or thrift as important values to communicate. Consumers also assign non-monetary meaning to fuel prices, for example seeing rising prices as evidence of conspiracy. This research suggests that consumer responses to fuel economy technology and changes in fuel prices are more complex than economic assumptions suggest.The US Department of Energy and the Energy Foundation supported this research. The authors are solely responsible for the content and conclusions presented. r

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Section: Article In Pressmentioning

confidence: 99%