472NOT01.DOC                                    September 8, 1996

Rational Decision-Making:
Efficiency Of Choice And
Reasonableness Of Estimates

1. Are Decision-Makers Crucial, And If So, Does It Matter If They Are
Rational?

Three Levels Of Analysis: International System, National, Individual
Decision-Maker.

If International System Or National Levels, Leaders Less Important. If
Individual Level, Then Leaders More Important.

International System And National Environment Of Leaders Constrain Them To
Make Choices And Lessen Their Own Importance.

In The Context Of A Tight Bipolar Cold War International System, Leaders
Have Fewer Degrees Of Freedom Than In A Loose, Multipolar System.

But Leaders Do Make A Difference, And The Degree Of Rationality Is
Important.

If Leaders Are To Be Held Responsible For Their Actions, They Must Be
Capable Of Rational Action.

If Saddam Hussein Is So Damned Insane, Can Be Held Accountable For His War
Crimes?

Rationality Is A Prerequisite For Responsibility.

Cognitive Psychologists Argue That Rationality Is Not Generally The
Dominant Mechanism Of Choice.

Human Capacity For Complex Calculation And Reasoned Argument Constrained
By Cognitive Structures.

Decision-Makers Diagnose Problems, Draw Inferences, Examine Alternatives,
And Make Choices Through Mechanisms That Bear Little Resemblance To
Comprehensive Rationality.

Evaluation Of Efficient, Static Choice

If Because Of Constraints, Leaders Cannot Choose The Best Available Means
Given Their Ends, They Are Not Subjectively Efficient.

Decision-Makers Are Rational If They Choose The Most Efficient
Choice--That Alternative That Promises The Highest Expected Value, Either
Highest Benefit Or Lowest Loss.

        Identify Options, Estimate Likelihood Consequences Of Options,
Consider Cost, Benefit, And Likelihood Of Success, Trade Off Expected Cost
And Benefit To Establish Expected Value. Then Select Option That Promise
Highest Gain Or Lowest Loss.

Rational Procedures Should Yield Expected Value Maximizing Outcomes Over
The Long Run.

Scorpion And Frog And The Jordan River. Scorpion Asked For A Ride, Frog
Considered The Likely Consequences Of Options And Said Yes. But First Frog
Said, If I Give You A Ride, You May Sting Me And Well Both Drown. The
Scorpion Assured The Frog That Such Action Was Unlikely Because His Goal
Was To Reach The Other Side Safely. Reassured By The Additional
Information, The Frog Agreed, And They Began The Trip. Halfway Across, The
Scorpion Stings The Frog, Causing Both To Go Down. Why? Asked The Frog.
The Scorpion Replied, You Dont Understand: This Is The Middle East.

Cant Evaluate Quality Of The Decision By The Outcome Of Death. The
Unsatisfactory Outcome Did Not Flow From Poor Decision -Making Procedures.
The Frog Considered Options, Estimated Consequences, And Selected The
Efficient Option. Frogs Death The Result Of Action Of The Scorpion, Ho
Alluded To Other Premises The Explain The Choice. Even If You Select The
Expected Value-Maximizing Option, That May Not Result In A Preferred
Option Being Achieved.

Is Monday Morning Quarter-Backing Fair?

In Evaluating Historical Choices, Only Use Information And Values Of
Leaders At The Time Of Choice Not Data Discovered After The Fact.

Can You Be Evil And Rational? Yes, The Rationality Of An Individual Is
Independent Of Values They Hold And Pursue.

In Evaluating Rationality Of Choice, Is It Reasonable To Be Critical Of
The Purposes Of Leaders? No!

Ok To Take Into Account The Risk Propensity Of Leaders. If You Know That
One Group Places Emphasis On Avoiding Loss, Then You
Should Expect Them To Choose The Risk Acceptant Option.

Another Group May Wish To Focus On Possible Gain, And They Should Choose
The Risk Averse Option.

Evaluation Of The Reasonableness Of Estimates

Dynamic Process Of Choice Requires Monitoring Of Changes In The
Environment And Updating The Likelihood Of Uncertain Outcomes.

Rational Process Of Estimation Conforms To The Norms Established By
Scientific Practices For Management Of Evidence. Gross Deviations From
Accepted Norms Is Indicative Of Lack Of Rationality.

Retention Of Organizing Assumptions In Light Of New Evidence Indicates
Deviation From Rationality.

Are Decision-Makers Too Radical In Their Processing Of Information? Yes,
But Do They Give Recent Information Too Much Weight In Revising Earlier
Judgments. No!

Decision-Makers Are Too Conservative In Their Judgments. They Tend To Pay
Too Little Attention To New Information And Resist Rather Than Exaggerate.

Were Leaders Aware Of Ambiguity Or Contradiction In The Information Given
To Them? Did They Seek Additional Information To Clarify Ambiguity? Did
They Consider More Than One Interpretation Of Evidence? Did They Consider
The Validity Of Observed Indicators? Did They Use Probabilistic Or
Categorical Language In Describing The Environment? In An Ambiguous And
Complicated World, Were They Skeptical Or Certain? Were They Aware Of
Biases In Information Processing?

Information Uncertainty And Value Complexity

Decision-Making Involves Reduction In Uncertainty And Simplification Of
Complexity.

Analytic Decision-making: Comprehensive Search, Optimal Revision, Complete
Evaluation, Value Maximization.

Cognitive Decision-Making: Constrained Search, Sub-Optimal Revision,
Incomplete Evaluation, And Single Value Choice Via Analogy, Beliefs.