This is a short clip about what rationality is usually taken to mean in models of rational action and what game theory brings to this important concept of rationality the social sciences. Generally the rational agent model for deicison making uses 3 key ideas to delineate the notion of rationality : (1) objectives and goals, (2) resources and feasibility constraints, and (3) contingencies and risks. Each of these ideas contributes to the key idea of constrained optimal choice in decision theory. But Game Theory adds a new dimension ….an awareness of the mutual awareness that all players are rational, with each being well aware that the other players know they are rational, and that they know they know…… This mutual awareness of rationality introduces some very distinctive ideas – and puzzles – about rational play in strategic situations that aren’t present in single person models of rational decision making where the “environment” for a decision, however complex, is explicitly viewed as either non-intelligent or blissfully ignorant of the roles of mutual conscious awareness of rationality.
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