A million answers to twenty questions: Choosing by checklist

What is it about?

This paper derives mathematically that an agent whose choices come from a checklist is essentially (although not explicitly) maximizing a utility function. Agents using checklists eliminate alternatives sequentially based on whether alternatives possess certain properties. This is a multistep process: at each step the agent checks whether the surviving alternatives have a required property and throws away the alternatives that do not have the required properties. In the standard case, this process terminates and there are a set of surviving alternatives. Because any utility maximizing decision-making process can be the outcome of a checklist that finitely terminates; checklists can be used to test whether rational behaviour materializes. More importantly, standard checklists are a ‘fast and frugal’ way to choose optimally among different alternatives. The more the alternatives that agents have to compare the more efficient checklists become in choosing among alternatives. By expanding the number of required checklist properties, agents can economize on making preference comparisons among alternatives.

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Why is it important?

It shows how there are cases where boundedly rational behaviour cannot be told apart from that of a textbook, fully rational "Homo Oeconomicus"