The next Economics Seminar of Paris-Saclay will take place on Thursday, December 15 from 12h15 to 13h15. Uwe Sundé (U. Munich) will present Complex Decisions and Performance Under Cognitively Bounded Rationality (joint with Anthony Strittmatter and Dainis Zegners).
This paper presents a novel approach to analyze human decision making and decision quality in a setting in which fully rational decisions are ruled out due to cognitive constraints: chess. The identification approach contrasts human behavior with a computational benchmark of cognitively bounded rationality based on the algorithms contained in modern chess engines. The results document that behavioral deviations are not necessarily associated with worse performance. Additional evidence shows that behavior is related to asymmetric evaluation, time pressure, fatigue, and complexity. Faster decisions are associated with more frequent deviations, but also with better performance, suggesting that intuition and expertise might be important behavioral factors.