Bounded Rationality and the Rational Bounding of Environmental Models

Douglas J. Crawford-Brown

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DOI: 10.2190/9923-JM1G-XKCQ-H7A4

Abstract

Models of environmental systems find use in three primary applications. They might form the basis of scientific research, where they serve both to explain environmental functioning and to act as a means of prediction. They also form the basis of regulatory decisions, in which they are called upon to make predictions of risk under varying conditions. Finally, environmental models may be used to suggest engineering changes to the environment, changes designed to bring about a different state of the environment. Due to incomplete knowledge of environmental systems, however, the models used in these roles usually are bounded, meaning that they ignore (or cannot account for) specific aspects of an environmental system which play a part in the overall behavior of specific systems to which the models are applied. Despite this bounding, these models still may form a rational basis for action or decisions. This rationality may only be obtained, however, when the intention underlying use of a model is limited to the situations in which the bounded model is applicable. This article presents a general discussion of how rational decisions may be made in light of bounded models of the environment. It is suggested that the bounding of the model must correspond to the bounding of the rationality underlying the decision. An example is provided, using a model of the risk from radon in homes, which illustrates how the bounding of rationality may be reflected in the bounding of an environmental model.

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