Universität Wien

040065 UK Modelling bounded rationality (MA) (2020W)

Smart heuristics and other alternatives to rational behavior

8.00 ECTS (4.00 SWS), SPL 4 - Wirtschaftswissenschaften
Prüfungsimmanente Lehrveranstaltung


Hinweis: Ihr Anmeldezeitpunkt innerhalb der Frist hat keine Auswirkungen auf die Platzvergabe (kein "first come, first served").


max. 30 Teilnehmer*innen
Sprache: Englisch


Termine (iCal) - nächster Termin ist mit N markiert

Dienstag 06.10. 16:45 - 18:15 Digital
Mittwoch 07.10. 15:00 - 16:30 Digital
Dienstag 13.10. 16:45 - 18:15 Digital
Mittwoch 14.10. 15:00 - 16:30 Digital
Dienstag 20.10. 16:45 - 18:15 Digital
Mittwoch 21.10. 15:00 - 16:30 Digital
Mittwoch 28.10. 15:00 - 16:30 Digital
Dienstag 03.11. 16:45 - 18:15 Digital
Mittwoch 04.11. 11:30 - 13:00 Digital
Dienstag 10.11. 16:45 - 18:15 Digital
Mittwoch 11.11. 15:00 - 16:30 Digital
Dienstag 17.11. 16:45 - 18:15 Digital
Mittwoch 18.11. 15:00 - 16:30 Digital
Dienstag 24.11. 16:45 - 18:15 Digital
Mittwoch 25.11. 15:00 - 16:30 Digital
Dienstag 01.12. 16:45 - 18:15 Digital
Mittwoch 02.12. 15:00 - 16:30 Digital
Mittwoch 09.12. 15:00 - 16:30 Digital
Dienstag 15.12. 16:45 - 18:15 Digital
Mittwoch 16.12. 15:00 - 16:30 Digital
Dienstag 12.01. 16:45 - 18:15 Digital
Mittwoch 13.01. 15:00 - 16:30 Digital
Dienstag 19.01. 16:45 - 18:15 Digital
Mittwoch 20.01. 15:00 - 16:30 Digital
Dienstag 26.01. 16:45 - 18:15 Digital
Mittwoch 27.01. 15:00 - 16:30 Digital


Ziele, Inhalte und Methode der Lehrveranstaltung

Rationality in economics typically refers to predictions based on expected utility maximization. Subjects need to know all their options, need to know all possible consequences of any of their choices and have to assign probabilities to any event that they are uncertain about. In this course we are interested in methodologies that do not make these heroic assumptions but satisfy some principles that identify behavior as being optimal in some sense. Behavior is optimal in a minimal sense if it can be backed up by a reason for acting. We will not limit ourselves to this minimal interpretation of optimality as this will not give us any insight as to whether we should expect such behavior to survive over time. The presumption is that a heuristic as a model of how to make choices can only emerge if it has properties that signal it out as being optimal or particularly well adapted to a situation. A central paper in this course (Schlag, 1998) was recently elected as one of the 50 most influential papers in a leading economic theory journal in the past 50 years. The objective therein is to understand how individual can learn from each other with only very limited understanding of the consequences of their behavior. It is the way that individuals learn which can make them very smart as a whole. We will also consider individuals who can only learn from their own past experiences. Buzz words include imitation, cultural evolution, heuristics, tabus and reinforcement learning. A central focus of the course will be on fostering a discussion about the philosophical and economic approaches to rationality and how the latter can be relaxed.

Art der Leistungskontrolle und erlaubte Hilfsmittel

Exams will be open book. The grade of the course is based on a midterm (35%), a final exam (35%) and oral participation together with some take home assignments (30%).

Mindestanforderungen und Beurteilungsmaßstab

This is both a course for the Master in Economics and for the Master in Philosophy and Economics. It should only be taken if you are familiar with expected utility theory (von Neumann Morgenstern preferences). Mathematical notation will be used to describe what individuals are doing and how this changes over time. Mathematics at a very simple level will be used to define optimality and then to compute what is optimal. In particular, the original article (Schlag, 1998) is mathematically unnecessarily advanced. We will see in the course that the basic intuition does not require such elaborate math.


Everything that was taught in class.


Schlag, K.H. (1998), Why Imitate, and if so, How? A Boundedly Rational Approach to Multi-Armed Bandits, Journal of Economic Theory 78 (1998), 130–156.
Börgers, T., A. Morales, and R. Sarin (2004), Expedient and monotone learning rules, Econometrica 72(2), 383–405.
Weibull, J. (1997), Evolutionary Game Theory, MIT Press.
Fudenberg, D., and D. Levine (1998), The Theory of Learning in Games, MIT Press.

Zuordnung im Vorlesungsverzeichnis

Letzte Änderung: Fr 12.05.2023 00:12