A Course in Game Theory by Rubenstein

By Rubenstein

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It's about getting the process right. When you pay a mechanic to figure out what's making that funny noise under the bonnet of your car you probably don't spend too much time worrying about how intelligent he is. What you worry about is whether he has the right training and the right tools. Our aim in this opening chapter is to build a model of the problem-solving process. Whether it's a mechanic working under the bonnet of our car or someone at the Bank of England deciding whether to raise interest rates by a point or two, all we can hope for is that the person has mastered the art of straight thinking.

In practice, there is considerable overlap amongst the six steps, and a good deal of skipping back and forth. So let's treat the model as a convenient checklist of basic steps needed to bring order to the problem-solving and decision-making process. And it is, as we have already agreed, an iterative model where Step Six connects back into Step One and re-starts the whole cycle. Problem-Solving Versus Decision-Making We should probably clarify these terms, and now is a good time to do so - before we get too far into our discussion.

How Important is It? Urgent problems clamour for attention but that doesn't necessarily reflect their importance in the overall scheme of things. Fixing a flat tyre on your car is urgent. You can't drive unless you do it. Getting your oil changed regularly, though hardly urgent, is very important in terms of safeguarding your car's health and welfare over the long haul. Page 24 The point is this. We can't afford to allow urgency alone to govern our response to problems. The importance factor has to be entered into the equation as well.

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Categories: Decision Making Problem Solving