Saturday, March 21, 2009

Economics Nobel Laureate Herbert Simon Featured as a "Guru" in Latest Issue of the Economist

Herbert Simon (1916-2001), winner of the 1978 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, has been featured as one of management's "Gurus" by the Economist.

Simon worked in the area of behavioral economics long before it became sexy. For example, Sim
on realized that it is unreasonable to assume that economic agents will always be able to choose rationally in decision-making situations that are complex beyond the agents' abilities to understand the situation at a reasonable cost--in terms of study, effort, data gathering, etc. As a result, when faced with such complexity, most of us will defer to rules of thumb in making our decisions, especially when those rules appear to yield reasonably happy outcomes over and over. Thus we appear to act more-or-less rationally, even when we may not make the very wisest choice available.

magazine's recent feature on Simon is taken from their book, Guide to Management Ideas and Gurus. The book profiles more than 50 legendary thinkers in management including Simon--himself a U of Chicago-educated economist--and features more than 100 innovative ideas.

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