Rational vs Bounded Rationality Models | From A Business Professor

When managers make decisions, we often assume they carefully weigh every option and choose the best possible outcome. But in reality, things aren’t always that simple. This brings us to two important ideas in management and decision-making: the Rational Model and the Bounded Rationality Model. So what do these models mean? How are they different? And why are they important for understanding how managers actually make decisions? In this video, I will discuss these questions with you.