The notion of bounded rationality was initiated in the 1950s by Herbert Simon; only recently has it influenced mainstream economics. In this book, Ariel Rubinstein defines models of bounded rationality as those in which elements of the process of choice are explicitly embedded. The book focuses...

The Nobel Prize in Economics was awarded to Herbert Simon in 1978. At Carnegie Mellon University he holds the title of Professor of Computer Science and Psychology. These two facts together delineate the range and uniqueness of his contributions in creating meaningful interactions among fields...

In a complex and uncertain world, humans and animals make decisions under the constraints of limited knowledge, resources, and time. Yet models of rational decision making in economics, cognitive science, biology, and other fields largely ignore these real constraints and instead assume agents...

This is the second volume in a three-volume exposition of Martin Shubik's vision of "mathematical institutional economics"—a term he coined in 1959 to describe the theoretical underpinnings needed for the construction of an economic dynamics. The goal is to develop a process-oriented theory of...

This is the second volume in a three-volume exposition of Martin Shubik's vision of "mathematical institutional economics"—a term he coined in 1959 to describe the theoretical underpinnings needed for the construction of an economic dynamics. The goal is to develop a process-oriented theory of...

Corporate managers who face both strategic uncertainty and market uncertainty confront a classic trade-off between commitment and flexibility. They can stake a claim by making a large capital investment today, influencing their rivals' behavior; or they can take a "wait and see" approach to...

Empirical literature in disciplines ranging from behavioral genetics to economics shows that in virtually every aspect of life the outcomes of children are correlated to a greater or lesser extent with the outcomes of their parents and their siblings. In Heredity, Family, and Inequality, the...

This book bridges optimal control theory and economics, discussing ordinary differential equations, optimal control, game theory, and mechanism design in one volume. Technically rigorous and largely self-contained, it provides an introduction to the use of optimal control theory for...

This landmark theoretical book is about the mechanisms by which special interest groups affect policy in modern democracies. Defining a special interest group as any organization that takes action on behalf of an identifiable group of voters, Gene Grossman and Elhanan Helpman ask: How do special...

The authors, two of the most prominent game theorists of this generation, have devoted a number of years to the development of the theory presented here, and to its economic applications. They propose rational criteria for selecting one particular uniformly perfect equilibrium point as the...