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Economics

In economics, satisficing is a behavior which attempts to achieve at least some minimum level of a particular variable, but which does not necessarily maximize its value. The most common application of the concept in economics is in the behavioural theory of the firm, which, unlike traditional accounts, postulates that producers treat profit not as a goal to be maximized, but as a constraint. Under these theories, a critical level of profit must be achieved by firms; thereafter, priority is attached to the attainment of other goals.

The word satisfice was coined by Herbert Simon as a portmanteau of "satisfy" and "suffice". Simon pointed out that human beings lack the cognitive resources to maximize: we usually do not know the relevant probabilities of outcomes, we can rarely evaluate all outcomes with sufficient precision, and our memories are weak and unreliable. A more realistic approach to rationality takes into account these limitations: This is called bounded rationality.

Some consequentialist theories in moral philosophy use the concept of satisficing in the same sense, though most call for optimization instead.

Cybernetics (Artificial Intelligence)

In cybernetics, satisficing is optimization where all costs, including the cost of the optimization calculations and the cost of getting information for use in those calculations, are considered.

As a result, the eventual choice is usually sub-optimal as regards the main goal of the optimization, i.e. different from the optimum in the case that the costs of choosing are not taken into account.

Interestingly enough, within science fiction and artificial intelligence, the process of satisficing is traditionally seen as a sign of human behavior as opposed to brute force forms of computation. For example, in the game of chess played by HAL 9000 in the movie 2001: A Space Odyssey, HAL adopts a satisficing move to defeat his opponent (Frank Poole).

In real life, during a 1997 game against Deep Blue, Garry Kasparov, after being defeated in a game where his computer opponent adopted a satisficing position, remarked that the computer was "playing like a human." Kasparov later explained that, when playing computers, chess masters could often defeat them by predicting the most "rational" move; however, satisficing made such prediction unreliable.

Reference: Klaus Krippendorff's "A Dictionary of Cybernetics".

Social and Cognitive Psychology

In Social cognition, Jon Krosnick proposed a theory of survey satisficing which says that optimal question answering involves a great deal of cognitive work and that some people would use satisficing to reduce that burden. Some people may shortcut their cognitive processes in two ways:

Weak satisficing: Respondent executes all cognitive steps involved in optimizing, but less completely and with bias.

Strong satisficing: Respondent offers responses that will seem reasonable to the interviewer without any memory search or information integration.

Likelihood to satisfice is linked to respondent ability, respondent motivation and task difficulty

Regarding survey answers, satisficing manifests in:

choosing explicitly offered no-opinion response option

choosing socially desirable responses

non-differention when a battery of questions asks for ratings of multiple objects on the same response scale

acquiescence response bias, which is the tendency to agree with any assertion, regardless of its content

Decision Making

In decision-making, satisficing explains the tendency to select the first option that meets a given need or select the option that seems to address most needs rather than the “optimal” solution.

Example: One's task is to sew a patch onto a pair of jeans. The best needle to do the threading is a 4 inch long needle with a 3 millimeter eye. This needle is hidden in a haystack along with 1000 other needles varying in size from 1 inch to 6 inches. Satisficing claims that the first needle that can sew on the patch is the one that should be used. Spending time searching for that one specific needle in the haystack is a waste of energy and resources.

Simon, as a further example, once explained satisficing to his students by describing a mouse searching for cheese in a maze. The mouse might begin searching for a piece of Gouda, but unable to find any would eventually be "satisfied" and could "suffice" with any piece of cheese, such as cheddar.

Satisficing occurs in consensus building when the group looks towards a solution everyone can agree on even if it may not be the best.

Example: A group spends hours projecting the next fiscal year's budget. After hours of debating they eventually reach a consensus only to have one person speak up and ask if the projections are correct. When the group becomes upset at the question, it is not because this person is wrong to ask, but rather because they have come up with a solution that works. The projection may not be what will actually come, but the majority agrees on one number and thus the projection is good enough to close the book on the budget.

In many circumstances, the individual might be uncertain about what constitutes a satisfactory outcome. For example, an individual who only seeks a satisfactory retirement income may not know what level of wealth is required --- given uncertainty about future prices --- to ensure a satisfactory income. In this case, the individual can only evaluate outcomes on the basis of their probability of being satisfactory.

If the individual chooses that outcome which has the maximum chance of being satisfactory, then this individual's behavior is theoretically indistinguishable from that of an optimizing individual under certain conditions (Castagnoli and LiCalzi, 1996; Bordley and LiCalzi, 2000; Bordley and Kirkwood, 2004).

References

Bordley, R. and M.LiCalzi.(2000). "Target-Oriented Utility." Decisions in Economics & Finance.
Bordley, R. and C. Kirkwood (2004)."Preference Analysis with Multiattribute Performance Targets." Operations Researcg.
Byron, M. (ed.). Satisficing and Maximizing: Moral Theorists on Practical Reason. Cambridge University Press, 2004.
Castagnoli, E. and M. LiCalzi,1996. "Utility Theory without Utility Function." Theory and Decision
Holbrook, A.; Green, M.; Krosnick, J. 2003. "Telephone versus face-to-face interviewing of national probability samples with long questionnaires - comparison of respondent satisficing and social desirability response bias." Public Opinion Quarterly, Vol 67, 79-125.
Krippendorff, Klaus. "A Dictionary of Cybernetics."
Krosnick, J. 1991. "Response strategies for coping with the cognitive demands of attitude measures in surveys." Applied Cognitive Psychology. Vol 5, 213-36.

External links

Web Dictionary of Cybernetics and Systems definition of "satisficing"
Michael Byron. Satisficing and Optimality. Ethics 109 (1998): 67-93. A paper on satisficing considered from a philosophical viewpoint.

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 Interestingly enough, within [[science fiction]] and [[artificial intelligence]], the process of satisficing is traditionally seen as a sign of ''human behavior'' as opposed to ''brute force'' forms of computation. For example, in the game of chess played by [[HAL 9000]] in the movie ''[[2001: A Space Odyssey (film)|2001: A Space Odyssey]]'', HAL adopts a satisficing move to defeat his opponent (Frank Poole).
-In real life, during a [[1997]] game against [[Deep Blue]], [[Garry Kasparov]], after being defeated in a game where his computer opponent adopted a satisficing position, remarked that the computer was "playing like a human." Kasparov later explained that, when playing computers, chess masters could often defeat them by predicting the most "rational" move; however, satisficing made such prediction unreliable.
+In real life, during a [[1997]] game against [[IBM Deep Blue|Deep Blue]], [[Garry Kasparov]], after being defeated in a game where his computer opponent adopted a satisficing position, remarked that the computer was "playing like a human." Kasparov later explained that, when playing computers, chess masters could often defeat them by predicting the most "rational" move; however, satisficing made such prediction unreliable.
 Reference: Klaus Krippendorff's "A Dictionary of Cybernetics".