A Theory of Rational Random Behavior
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It is shown that, under general conditions, rational random behavior (appropriately defined) is equivalent to large-sample maximum-likelihood estimation of the theoretically optimal decision. Some supporting evidence, based on Dutch and American consumption data, is presented. The approach can also be used as a statistical basis for the delegation of authority.
KeywordsDecision Maker Covariance Matrix Maximum Likelihood Estimator Criterion Function Planning Stage
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