Levinthal, D.A. (2011) A behavioral approach to strategy - what's the alternative?

Question 1

GOAL

Answer 1

recognize that rationality cannot exist without behaviour

Question 2

2 camps:

Answer 2

2 camps: economists (optimize, maximize, utilitarianism etc) and behavioralists

Question 3

Contrast between the rational and behavioural approach?

Answer 3

 A rational choice process requires problem framing and representation beforehand = Even choosing an optimal and rational solution involves behaviour
 Rationality as a process, not as an outcome.

Question 4

Loose coupling vs actual environment

Answer 4

“A failure to recognize the inherent loose coupling between our models of the world and the actual environment in which we act likely leads to a dangerous degree of hubris on the part of decision makers”

“This recognition that the constraints of bounded rationality are a function of the nature of the task environment has a deep irony for the field of neo- classical economics”

Question 5

Small world:

Answer 5

Small world, simplified low dimensional representation of reality.
- To act in a deductive, intentionally rational manner in a complex world inevitably requires the explicit or implicit creation of a small world representation

Question 6

The choice is not between :

Answer 6

The choice is not between whether we should act in a God-like manner or like mortals. We are mortals. Given this second-best setting, the question is how to act with intelligence and efficacy in strategic contexts.

Question 7

World of second best

Answer 7

I suggest that all approaches to strategic decision making operate in the world of second best. We should not privilege one approach as having a universal a priori claim of superiority. To do so creates false divides in the field and obscures terribly important lines of future inquiry.