Chris R. Sims, Hansjörg Neth, Robert A. Jacobs, Wayne D. Gray

Melioration as rational choice: Sequential decision making in uncertain environments

Abstract:  Melioration — defined as choosing a lesser, local gain over a greater longer term gain — is a behavioral tendency that people and pigeons share.  As such, the empirical occurrence of meliorating behavior has frequently been interpreted as evidence that the mechanisms of human choice violate the norms of economic rationality.  In some environments, the relationship between actions and outcomes is known. In this case, the rationality of choice behavior can be evaluated in terms of how successfully it maximizes utility given knowledge of the environmental contingencies.  In most complex environments, however, the relationship between actions and future outcomes is uncertain and must be learned from experience.  When the difficulty of this learning challenge is taken into account, it is not evident that melioration represents suboptimal choice behavior.