Rational decision making under uncertainty and ignorance
This chapter explores alternative approaches to decision making under uncertainty and ignorance: the quasi-probabilistic approach, extremum approaches and approaches focusing on the spectrum of future options and possibilities. It defines the approaches by their respective bridge-principles before presenting sound applications and discussing their limitations. Also, it introduces the theory of sequential decision making which allows to apply the findings regarding one step decisions to sequential cases, too. In sum, this chapter demonstrates that there is no unique, entirely convincing approach to decision making under uncertainty and ignorance.
KeywordsOpenness Approach Rational Decision Precautionary Principle Initial Decision Extremum Principle
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