Cambridge Dictionaries online Cambridge Dictionaries online

The most popular online dictionary and thesaurus for learners of English

English definition of “bounded rationality”

bounded rationality

noun [U]
 
 
ECONOMICS the theory that people can understand only a limited amount of information within a limited amount of time, and for this reason they do not always make the best decisions, especially in complicated situations: Managers constrained by bounded rationality cannot foresee all of the relevant behaviours needed for organizational effectiveness.
(Definition of bounded rationality from the Cambridge Business English Dictionary © Cambridge University Press)
What is the pronunciation of bounded rationality?
Add Cambridge dictionaries to your browser to your website

Word of the Day

scrumpy

an alcoholic drink made from apples

Word of the Day

Blog

Read our blog about how the English language behaves.

Learn More

New Words

Find words and meanings that have just started to be used in English, and let us know what you think of them.

Learn More