In Peter M.

Todd and Gerd Gigerenzer

(eds). Ecological rationality :
intelligence in the world. Oxford
University Press, Inc., 2012

1
What Is Ecological Rationality?
Peter M. Todd
Gerd Gigerenzer

Human rational behavior...is shaped by a scissors whose

two blades are the structure of task environments and the
computational capabilities of the actor.
Herbert A. Simon

“
M ore information is always better, full information is best. More
computation is always better, optimization is best.” More-is-better
ideals such as these have long shaped our vision of rationality. The
philosopher Rudolf Carnap (1947), for instance, proposed the
“principle of total evidence,” which is the recommendation to use
all the available evidence when estimating a probability. The statis-
tician I. J. Good (1967) argued, similarly, that it is irrational to make
observations without using them. Going back further in time, the
Old Testament says that God created humans in his image (Genesis
1:26), and it might not be entirely accidental that some form of
omniscience (including knowledge of all relevant probabilities
and utilities) and omnipotence (including the ability to compute
complex functions in a blink) has sneaked into models of human
cognition. Many theories in the cognitive sciences and economics
have recreated humans in this heavenly image—from Bayesian
models to exemplar models to the maximization of expected utility.
Yet as far as we can tell, humans and other animals have always
relied on simple strategies or heuristics to solve adaptive problems,
ignoring most information and eschewing much computation
rather than aiming for as much as possible of both. In this book,
we argue that in an uncertain world, more information and com-
putation is not always better. Most important, we ask why and
when less can be more. The answers to this question constitute the
idea of ecological rationality, how we are able to achieve intelli-
gence in the world by using simple heuristics in appropriate con-
texts. Ecological rationality stems in part from the nature of those

3
4 THE RESEARCH AGENDA

heuristics, and in part from the structure of the environment: Our

intelligent, adaptive behavior emerges from the interaction of both
mind and world. Consider the examples of investment and sports.

Making Money
In 1990, Harry Markowitz received the Nobel Prize in Economics
for his path-breaking work on optimal asset allocation. He addressed
a vital investment problem that everyone faces in some form or
other, be it saving for retirement or earning money on the stock
market: How to invest your money in N available assets. It would
be risky to put everything in one basket; therefore, it makes sense
to diversify. But how? Markowitz (1952) derived the optimal rule
for allocating wealth across assets, known as the mean–variance
portfolio, because it maximizes the return (mean) and minimizes
the risk (variance). When considering his own retirement invest-
ments, we could be forgiven for imagining that Markowitz used his
award-winning optimization technique. But he did not. He relied
instead on a simple heuristic:

1/ N rule: Invest equally in each of the N alternatives.

Markowitz was not alone in using this heuristic; empirical stud-

ies indicate that about 50% of ordinary people intuitively rely on it
(Huberman & Jiang, 2006). But isn’t this rule naive and silly? Isn’t
optimizing always better? To answer these questions, a study com-
pared the 1/N rule with the mean–variance portfolio and 13 other
optimal asset allocation policies in seven investment problems,
such as allocating one’s money among 10 American industry funds
(DeMiguel, Garlappi, & Uppal, 2009). The optimizing models
included sophisticated Bayesian and non-Bayesian models, which
got 10 years of stock data to estimate their parameters for each
month of portfolio prediction and investment choices. The 1/N
rule, in contrast, ignores all past information. The performance of
all 15 strategies was evaluated by three standard financial measures,
and the researchers found that 1/N came out near the top of the
pack for two of them (in first place on certainty equivalent returns,
second on turnover, and fifth on the Sharpe ratio). Despite complex
estimations and computations, none of the optimization methods
could consistently earn better returns than the simple heuristic.
How can a simple heuristic outperform optimizing strategies?
Note that in an ideal world where the mean–variance portfolio
could estimate its parameters perfectly, that is, without error, it
would do best. But in an uncertain world, even with 10 years’ worth
of data, optimization no longer necessarily leads to the best out-
come. In an uncertain world, one needs to ignore information to
 WHAT IS ECOLOGICAL RATIONALITY? 5

make better decisions. Yet our point is not that simple heuristics
are better than optimization methods, nor the opposite, as is typi-
cally assumed. No heuristic or optimizing strategy is the best in all
worlds. Rather, we must always ask, in what environments does a
given heuristic perform better than a complex strategy, and when is
the opposite true? This is the question of the ecological rationality
of a heuristic. The answer requires analyzing the information-
processing mechanism of the heuristic, the information structures
of the environment, and the match between the two. For the choice
between 1/N and the mean–variance portfolio, the relevant envi-
ronmental features include (a) degree of uncertainty, (b) number
N of alternatives, and (c) size of the learning sample.
It is difficult to predict the future performance of funds because
uncertainty is high. The size of the learning sample is the estima-
tion window, with 5 to 10 years of data typically being used to cali-
brate portfolio models in investment practice. The 1/N rule tends to
outperform the mean–variance portfolio if uncertainty is high, the
number of alternatives is large, and the learning sample is small.
This qualitative insight allows us to ask a quantitative question: If
we have 50 alternatives, how large a learning sample do we need so
that the mean–variance portfolio eventually outperforms the simple
heuristic? The answer is: 500 years of stock data (DeMiguel et al.,
2009). Thus, if you started keeping track of your investments now,
in the 26th century optimization would finally pay off, assuming
that the same funds, and the stock market, are still around.

Catching Balls
Now let us think about sports, where players are also faced with
challenging, often emotionally charged problems. How do players
catch a fly ball? If you ask professional players, they may well stare
at you blankly and respond that they had never thought about it—
they just run to the ball and catch it. But how do players know
where to run? A standard account is that minds solve such complex
problems with complex algorithms. An obvious candidate complex
algorithm is that players unconsciously estimate the ball’s trajec-
tory and run as fast as possible to the spot where the ball will hit
the ground. How else could it work? In The Selfish Gene, biologist
Richard Dawkins (1989, p. 96) discusses exactly this:

When a man throws a ball high in the air and catches it again, he
behaves as if he had solved a set of differential equations in pre-
dicting the trajectory of the ball. He may neither know nor care
what a differential equation is, but this does not affect his skill
with the ball. At some subconscious level, something function-
ally equivalent to the mathematical calculation is going on.
6 THE RESEARCH AGENDA

Computing the trajectory of a ball is not a simple feat. Theoretically,

balls have parabolic trajectories. To select the right parabola, play-
ers would have to estimate the ball’s initial distance, initial veloc-
ity, and projection angle. Yet in the real world, balls do not fly in
parabolas, due to air resistance, wind, and spin. Thus, players’
brains would further need to estimate, among other things, the
speed and direction of the wind at each point of the ball’s flight, in
order to compute the resulting path and the point where the ball
will land. All this would have to be completed within a few sec-
onds—the time a ball is in the air. Note that Dawkins carefully
inserts the term “as if,” realizing that the estimations and computa-
tions cannot really be done consciously but suggesting that the
unconscious somehow does something akin to solving the differen-
tial equations. Yet the evidence does not support this view: In
experiments, players performed poorly in estimating where the ball
would strike the ground (Babler & Dannemiller, 1993; Saxberg,
1987; Todd, 1981). After all, if professional baseball players were
able to estimate the trajectory of each hit and know when it would
land out of reach, we would not see them running into walls, dug-
outs, and over the stands trying to catch fly balls.
As in the investment problem, we can take a different approach
and instead ask: Is there a simple heuristic that players use to
catch balls? Experimental studies have shown that experienced
players in fact use various rules of thumb. One of these is the gaze
heuristic, which works in situations where a ball is already high up
in the air:

Gaze heuristic: Fixate your gaze on the ball, start running, and
adjust your running speed so that the angle of gaze remains
constant.

The angle of gaze is the angle between the eye and the ball, rela-
tive to the ground. Players who use this rule do not need to measure
wind, air resistance, spin, or the other causal variables. They can
get away with ignoring all these pieces of causal information. All
the relevant facts are contained in only one variable: the angle of
gaze. Note that players using the gaze heuristic are not able to com-
pute the point at which the ball will land, just as demonstrated by
the experimental results. But the heuristic nevertheless leads them
to the landing point in time to make the catch.
Like the 1/N rule, the gaze heuristic is successful in a particular
class of situations, not in all cases, and the study of its ecological
rationality aims at identifying that class. As many ball players say,
the hardest ball to catch is the one that heads straight at you, a situ-
ation in which the gaze heuristic is of no use. As mentioned before,
the gaze heuristic works in situations where the ball is already high
 WHAT IS ECOLOGICAL RATIONALITY? 7

in the air, but it fails if applied right when the ball is at the begin-
ning of its flight. However, in this different environmental condi-
tion, players do not need a completely new heuristic—just a slightly
modified one, with a different final step (McBeath, Shaffer, & Kaiser,
1995; Shaffer, Krauchunas, Eddy, & McBeath, 2004):

Modified gaze heuristic: Fixate your gaze on the ball, start run-
ning, and adjust your running speed so that the image of the
ball rises at a constant rate.

The operation of this modified rule is intuitive: If players see the

ball appear to rise with accelerating gaze angle, they had better run
backward, because otherwise the ball will hit the ground behind
their present position. If, however, the ball rises with decreasing
apparent speed, they need to run toward it instead. Thus, different
but related rules apply in different situations—these are the kinds
of relationships that the study of ecological rationality aims to
reveal. As we will see, there is much work to be done—and many
approaches that can be applied—to reveal these relationships.
Unfortunately, we cannot simply ask the users of these rules: Most
fielders are blithely unaware of their reliance on the gaze heuristic,
despite its simplicity (McBeath et al., 1995; Shaffer & McBeath,
2005). Other heuristics such as the 1/N rule may be consciously
taught and applied, but without practitioners knowing why they
work, and when. We must explore to find out.

What Is a Heuristic?

As these examples illustrate, a heuristic is a strategy that ignores

available information. It focuses on just a few key pieces of data to
make a decision. Yet ignoring some information is exactly what is
needed for better (and faster) judgments, and in this book we inves-
tigate how and when this can be so. Heuristics are where the rubber
meets the road, or where the mind meets the environment, by guid-
ing action in the world. They process the patterns of information
available from the environment, via their building blocks based on
evolved capacities (described below), to produce goal-directed
behavior.
Humans and other animals use many types of heuristics to meet
the adaptive challenges they face. But each new task does not nec-
essarily demand a new heuristic: One heuristic can be useful for a
broad range of problems. The gaze heuristic, for instance, did not
evolve for the benefit of baseball and cricket outfielders. Intercepting
moving objects is an important adaptive task in human and animal
history. From fish to birds to bats, many animals are able to track an
8 THE RESEARCH AGENDA

object moving through three-dimensional space, which is an

evolved capacity necessary for executing the gaze heuristic. Some
teleost fish catch their prey by keeping a constant angle between
their own line of motion and that of their target; male hoverflies
intercept females in the same way for mating (Collett & Land, 1975).
And we can readily generalize the gaze heuristic from its evolution-
ary origins, such as in hunting, to ball games and other modern
applications. Sailors use the heuristic in a related way: If another
boat approaches and a collision might occur, then fixate your
eye on the other boat; if the bearing remains constant, turn away,
because otherwise a collision will occur. Again, these methods
are faster and more reliable than estimating the courses of two
moving objects and calculating whether there is an intersection
point. As we will see, simple rules are less prone to estimation and
calculation error and hence often more reliable in appropriate
situations.
Similarly, the 1/N rule is not just for making money. It is an
instance of a class of rules known as equality heuristics, which are
used to solve problems beyond financial investment. If you have
two or more children, how do you allocate your time and resources
among them? Many parents try to distribute their attention equally
among their N children (Hertwig, Davis, & Sulloway, 2002). Children
themselves often divide money equally among players in experi-
mental games such as the ultimatum game, a behavior that is not
predicted by game theory but is consistent with the human sense of
fairness and justice (Takezawa, Gummerum, & Keller, 2006).

Building Blocks of Heuristics

Most heuristics are made up of multiple building blocks. There are
a limited number of kinds of building blocks, including search
rules, stopping rules, and decision rules; by combining different
sets of these, many different heuristics can be constructed. For
instance, to choose a mate, a peahen does not investigate all pea-
cocks posing and displaying to get her attention, nor does she
weight and add all male features to calculate the one with the high-
est expected utility. Rather, she investigates only three or four and
picks the one with the largest number of eyespots (Petrie & Halliday,
1994). This mate choice heuristic is a form of satisficing (Table 1-1)
that consists of the simple search rule “investigate males in your
proximity,” the stopping rule “stop search after a sample of four,”
and the decision rule “choose on the basis of one cue (number of
eyespots).” Given a particular heuristic, changing one or more of its
building blocks allows the creation of a related heuristic adapted to
different problems, as illustrated by the modifications of the gaze
heuristic above.
Table 1-1: Twelve Well-Studied Heuristics With Evidence of Use in the Adaptive Toolbox of Humans
Heuristic Definition
Recognition heuristic If one of two alternatives is
(Goldstein & recognized, infer that it has the
Gigerenzer, 2002; higher value on the criterion.
chapter 5)
Fluency heuristic If both alternatives are recognized
(Schooler & Hertwig, but one is recognized faster,
2005; chapter 6) infer that it has the higher value
on the criterion.
Take-the-best (Gigerenzer To infer which of two alternatives
& Goldstein, 1996; has the higher value: (a) search
chapter 2) through cues in order of validity;
(b) stop search as soon as a cue
discriminates; (c) choose the
alternative this cue favors.
Tallying (unit-weight To estimate a criterion, do not
linear model; Dawes, estimate weights but simply
1979) count the number of positive
cues.
Satisficing (Simon, Search through alternatives and
1955a; Todd & Miller, choose the first one that exceeds
1999; chapter 18) your aspiration level.
One-bounce rule (Hey, Continue searching (e.g., for prices)
1982) as long as options improve; at the
first downturn, stop search and
take the previous best option.
Ecologically rational if: Surprising findings (examples)
Recognition validity > .5 Less-is-more effect if α > β;
systematic forgetting can be
beneficial (chapter 6)
Fluency validity > .5 Less-is-more effect; systematic
forgetting can be beneficial
Cue validities vary, high Often predicts more accurately
redundancy than multiple regression
(Czerlinski, Gigerenzer, &
Goldstein, 1999), neural
networks, exemplar models, and
decision tree algorithms
Cue validities vary Often predicts as accurately as or
little, low redundancy better than multiple regression
(Hogarth & Karelaia, (Czerlinski et al., 1999)
2005a, 2006b)
Distributions of available Aspiration levels can lead to
options and other costs substantially better choice than
and benefits of search chance, even if they are arbitrary
are unknown (e.g., Bruss, 2000)
Improvements come in Taking search costs into
streaks consideration in this rule does
not improve performance
(Continued )
Table 1-1: Twelve Well-Studied Heuristics With Evidence of Use in the Adaptive Toolbox of Humans
Heuristic
Gaze heuristic
(Gigerenzer, 2007;
McBeath, Shaffer, &
Kaiser, 1995)
1/N rule (DeMiguel,
Garlappi, & Uppal,
2009)
Default heuristic
(Johnson & Goldstein,
2003; chapter 16)
Tit-for-tat (Axelrod,
1984)
Imitate the majority
(Boyd & Richerson,
2005)
Imitate the successful
(Boyd & Richerson,
2005)
Note. For formal definitions and conditions concerning ecological rationality and surprising findings, see references indicated and related chapters
in this book.
Definition
To catch a ball, fix your gaze on it,
start running, and adjust your
running speed so that the angle
of gaze remains constant.
Allocate resources equally to each
of N alternatives.
If there is a default, follow it.
Cooperate first and then imitate
your partner’s last behavior.
Determine the behavior followed
by the majority of people in
your group and imitate it.
Determine the most successful
person and imitate his or her
behavior.
Ecologically rational if:
The ball is coming down
from overhead
High unpredictability,
small learning sample,
large N
Values of those who
set defaults match
those of the decision
maker; consequences
of a choice are hard to
foresee
The other players also
play tit-for-tat
Environment is stable or
only changes slowly;
info search is costly or
time consuming
Individual learning is
slow; info search is
costly or time consuming
Surprising findings (examples)
Balls will be caught while
running, possibly on a curved
path
Can outperform optimal asset
allocation portfolios
Explains why advertising has
little effect on organ donor
registration; predicts behavior
when trait and preference
theories fail
Can lead to a higher payoff than
“rational” strategies (e.g. by
backward induction)
A driving force in bonding,
group identification, and moral
behavior
A driving force in cultural
evolution
 WHAT IS ECOLOGICAL RATIONALITY? 11

Evolved Capacities
Building blocks of heuristics are generally based on evolved cap-
acities. For instance, in the gaze heuristic, to keep the gaze angle
constant an organism needs the capacity to track an object visually
against a noisy background—something that no modern robot or
computer vision system can do as well as organisms (e.g., humans)
that have evolved to follow targets. When we use the term evolved
capacity, we refer to a product of nature and nurture—a capacity
that is prepared by the genes of a species but usually needs experi-
ence to be fully expressed. For instance, 3-month-old babies spon-
taneously practice holding their gaze on moving targets, such as
mobiles hanging over their crib. Evolved capacities are one reason
why simple heuristics can perform so well: They enable solutions
to complex problems that are fundamentally different from the
mathematically inspired ideal of humans and animals somehow
optimizing their choices. Other capacities underlying heuristic
building blocks include recognition memory, which the recogni-
tion heuristic and fluency heuristics exploit, and counting and
recall, which take-the-best and similar heuristics can use to esti-
mate cue orders.

The Adaptive Toolbox

We refer to the repertoire of heuristics, their building blocks, and
the evolved capacities they exploit as the mind’s adaptive toolbox
(Gigerenzer & Selten, 2001; Gigerenzer & Todd 1999). Table 1-1
lists a dozen heuristics that are likely in the adaptive toolbox of
humans, and in some other animal species, although the last couple
are rare even in primates and the evidence is controversial. The
content of the adaptive toolbox depends not only on the species,
but also on the individual and its particular stage of ontogenetic
development and the culture in which it lives.
The degree to which species share heuristics will depend on
whether they face the same adaptive problems, inhabit environ-
ments with similar structures, and share the evolved capacities on
which the heuristics are built. For instance, while the absence of
language production from the adaptive toolbox of other animals
means they cannot use name recognition to make inferences about
their world, some animal species can use other capacities, such as
taste and smell recognition, as input for the recognition heuristic.
A shared capacity between two species makes it more likely that
they will rely on similar heuristics, even if they have to solve differ-
ent problems, such as intercepting prey as opposed to fly balls. If
two species face the same adaptive problem but their evolved capac-
ities differ, this will lead to different heuristics. Consider estimation
12 THE RESEARCH AGENDA

of area. Humans can visually estimate area by combining height

and width dimensions. Some species of ants, instead, can produce
pheromone trails, leading to a very different area-estimation heu-
ristic based on this capacity: To judge the area of a candidate nest
cavity (typically a narrow crack in a rock), run around on an irregu-
lar path for a fixed period of time, laying down a pheromone trail;
then leave; then return to the cavity, move around on a different
irregular path, and estimate the cavity’s size by the inverse of the
frequency of reencountering the old trail. This heuristic is remark-
ably precise—nests that are half the area of others yield reencoun-
ter frequencies about 1.96 times greater (Mugford, Mallon, & Franks,
2001). Many such evolved rules of thumb in animals (including
humans) are amazingly simple and efficient (see the overview by
Hutchinson & Gigerenzer, 2005).

What Is Not a Heuristic?

Not all of the cognitive mechanisms that humans use, or devise for
use by artificial systems, are heuristics. Strategies such as the mean–
variance portfolio and the trajectory prediction approach described
above are not heuristics, because they attempt to weight and add
all available information and make use of heavy computation to
reach “optimal” decisions. The origins of such optimization theo-
ries can be traced back to the classical theory of rationality that
emerged during the Enlightenment. The birth year of this view has
been dated 1654, when the French mathematicians Blaise Pascal and
Pierre Fermat defined rational behavior as the maximization of the
expected value of alternative courses of action (Daston, 1988;
Gigerenzer et al., 1989). This vision of rationality goes hand in hand
with the notion that complex problems need to be solved by complex
algorithms and that more information is always better. A century later,
Benjamin Franklin described the ideal of weighting and adding all
reasons in a letter to his nephew (Franklin, 1779/1907 pp. 281-282):

April 8, 1779
If you doubt, set down all the Reasons, pro and con, in
opposite Columns on a Sheet of Paper, and when you have
considered them two or three Days, perform an Operation
similar to that in some questions of Algebra; observe what
Reasons or Motives in each Column are equal in weight, one
to one, one to two, two to three, or the like, and when you
have struck out from both Sides all the Equalities, you will see
in which column remains the Balance.… This kind of Moral
Algebra I have often practiced in important and dubious
Concerns, and tho’ it cannot be mathematically exact, I have
 WHAT IS ECOLOGICAL RATIONALITY? 13

found it extreamly [sic] useful. By the way, if you do not learn

it, I apprehend you will never be married.
I am ever your affectionate Uncle,
B. FRANKLIN

Modern versions of Franklin’s moral algebra include expected

utility maximization in economics, Bayesian inference theories in
the cognitive sciences, and various bookkeeping principles taught
in MBA courses and recommended by consulting firms. Markowitz’s
mean–variance optimization model and the calculation of a ball’s
trajectory are all variants of this form of calculative rationality.
Note that Franklin ends with the warning that learning his moral
algebra is necessary for marriage. We checked whether Franklin’s
admonition holds among a sample of economists who teach modern
versions of this optimizing view of rationality, asking them whether
they had chosen their partner using their favorite rational method.
Only one had. He explained that he had listed all the options he
had and all the important consequences that he could think of
for each woman, such as whether she would still be interesting to
talk to after the honeymoon excitement was over, would be good
at taking care of children, and would support him in his work
(cf. Darwin’s similar considerations—Gigerenzer & Todd, 1999). He
took several days to estimate the utilities of each of these conse-
quences and the probabilities for each woman that these conse-
quences would actually occur. Then he calculated the expected
utility for each candidate and proposed to the woman with the
highest value, without telling her how he had made his choice. She
accepted and they married. And now he is divorced.
The point of this story is emphatically not that Franklin’s
rational bookkeeping method is less successful in finding good
mates than simple heuristics, such as “try to get the woman that
your peers desire” (known as mate choice copying, which humans
and other animals follow—Place, Todd, Penke, & Asendorpf, 2010).
Rather, our point is that there is a discrepancy between theory and
practice: Despite the weight-and-add approach being advertised as
the rational method, even devoted proponents often instead rely on
heuristics in important decisions (Gigerenzer, 2007). Health is
another case in point. In a study, more than 100 male economists
were asked how they decided whether to have a prostate cancer
screening test (the PSA, or prostate specific antigen test—Berg,
Biele, & Gigerenzer, 2010). For this and other screening tests, virtually
all medical societies recommend that patients carefully weigh pros
and cons before deciding whether or not to have it; in this par-
ticular case, the benefit remains controversial (it is not proven that
screening saves lives) whereas its harms are clear (such as possible
 14 THE RESEARCH AGENDA

incontinence and impotence from operations following positive

tests). Yet two thirds of the economists interviewed said that they
had not weighed any pros and cons regarding this test but just did
whatever their doctors (or wives) said they should do. These cham-
pions of rationality were using the social heuristic “trust your
doctor” rather than the traditionally rational approach to make this
important decision. Again, theory and practice are at odds.
But which is right? We cannot say, without further investigation:
A heuristic is neither good nor bad per se, nor is a rational approach
such as Franklin’s bookkeeping method. Rather, the study of
ecological rationality informs us that we must ask a further all-
important question: In what environments does a given decision
strategy or heuristic perform better than other approaches? For
instance, in a world where doctors practice defensive decision
making because of fear of lawyers and malpractice trials (leading to
overtreatment and overmedication of patients) and where most
doctors do not have the time to read the relevant medical studies, it
pays to weigh pros and cons oneself rather than rely on the trust-
your-doctor heuristic (Gigerenzer, Gaissmaier, Kurz-Milcke,
Schwartz, & Woloshin, 2007).

What Is Ecological Rationality?

The concept of ecological rationality—of specific decision-making

tools fit to particular environments—is intimately linked to that
of the adaptive toolbox. Traditional theories of rationality that
instead assume one single universal decision mechanism do not
even ask when this universal tool works better or worse than any
other, because it is the only one thought to exist. Yet the empirical
evidence looks clear: Humans and other animals rely on multiple
cognitive tools. And cognition in an uncertain world would be
inferior, inflexible, and inefficient with a general-purpose optimiz-
ing calculator, for reasons described in the next section (see also
chapter 2).
We use the term ecological rationality both for a general vision of
rationality and a specific research program. As a general vision, it
provides an alternative to views of rationality that focus on internal
consistency, coherence, or logic and leave out the external environ-
ment. Ecological rationality is about the success of cognitive strate-
gies in the world, as measured by currencies such as the accuracy,
frugality, or speed of decisions. In our previous book, Simple
Heuristics That Make Us Smart, we introduced this term to flesh
out Herbert Simon’s adaptive view of rational behavior (Gigerenzer,
Todd, & the ABC Research Group, 1999). As Simon put it, “Human
rational behavior...is shaped by a scissors whose two blades are
 WHAT IS ECOLOGICAL RATIONALITY? 15

the structure of task environments and the computational capabili-

ties of the actor” (Simon, 1990, p. 7). We use the term logical ratio-
nality for theories that evaluate behavior against the laws of logic
or probability rather than success in the world, and that ask ques-
tions such as whether behavior is consistent, uses all information,
or corresponds to an optimization model. Logical rationality is
determined a priori—that is, what is good and bad is decided by
abstract principles—instead of by testing behavior in natural envi-
ronments. Shortly before his death, Simon assessed the ecological
rationality approach as a “revolution in cognitive science, striking
a great blow for sanity in the approach to human rationality”
(see Gigerenzer, 2004b), and Vernon Smith further promoted the
approach, using it in the title of his Nobel Laureate lecture (Smith,
2003). While it is being pursued by a growing number of such
leading researchers, the ecological approach is at present still a
small island compared to the wide empire of logical theories of
rationality.
As a research program, the study of ecological rationality inves-
tigates the fit between the two blades of Simon’s scissors. Fitting
well does not mean that the blades are mirror image reflections of
each other (cf. Shepard, 1994/2001; Todd & Gigerenzer, 2001)—in
manufacturing, the two blades of a good pair of scissors are made to
slightly twist or to curve with respect to one another so that they
touch at only two places: the joint and the spot along the blades
where the cutting is taking place. Furthermore, for cognition to be
successful, there is no need for a perfect mental image of the envi-
ronment—just as a useful mental model is not a veridical copy of
the world, but provides key abstractions while ignoring the rest. In
the finest scissors, the two blades that are made to fit each other are
coded with an identification mark to make sure that they are treated
as a pair. The study of ecological rationality is about finding out
which pairs of mental and environmental structures go together. As
we discuss in more detail in a section to come, it is based on envi-
ronment description, computer simulation, empirical test, and
analysis and proof, and it centers on three questions:

Given a heuristic, in what environments does it succeed?

Given an environment, what heuristics succeed?
How do heuristics and environments co-evolve to shape each
other?

The investment example answers the first and second questions,

which are intimately related. For instance, given the 1/N rule,
investment environments with many options—large N—and a
relatively small sample size of past data are the right match. Or
given an environment with N = 50 and 10 years of stock data, the
16 THE RESEARCH AGENDA

1/N rule is likely to perform better than the mean–variance port-

folio. Table 1-1 provides further such results, and so do the follow-
ing chapters. The third question addresses a larger issue, the
co-evolution of the adaptive toolbox and its environment. About
this, we know comparatively little—more research is needed to
study systematically the mutual adaptation of heuristics and envi-
ronments in ontogenetic or phylogenetic time (see chapter 18 for an
example).

The Structure of Environments

An environment is what an agent acts in and upon. The environ-
ment also influences the agent’s actions in multiple ways, by deter-
mining the goals that the agent aims to fulfill, shaping the tools
that the agent has for reaching those goals, and providing the
inputs processed by the agent to guide its decisions and behavior.
No thorough classification of environment structures exists at pres-
ent, but several important structures have been identified. Three of
these were revealed in the analysis of the investment problem
above: the degree of uncertainty, the number of alternatives, and
the size of the learning sample. Given their relevance for a wide
range of tasks, we consider them here in more detail.

Uncertainty The degree of uncertainty refers to how well the available

cues can predict a criterion. Uncertainty varies with the kind of cri-
terion and the prediction to be made. Next month’s performance of
stocks and funds is highly unpredictable, heart attacks are slightly
more predictable, and tomorrow’s weather is the most accurately
predictable among these three criteria. Furthermore, uncertainty is
higher when one has to make predictions about a different popula-
tion rather than just a different time period for the same population
(see chapter 2). Our investment example illustrates the important
principle that the greater the uncertainty, the greater can be the
advantage of simple heuristics over optimization methods, Bayesian
and otherwise.
There is an intuitive way to understand this result. In a world
without uncertainty, inhabited by gods and their secularized
version, Laplace’s demon, all relevant past information will aid
in predicting the future and so needs to be considered. In a fully
unpredictable world, such as a perfect roulette wheel, one can
ignore all information about the past performance of the wheel,
which is useless in saying what will come next. Most of the time,
though, humble humans live in the twilight of partial predictability
and partial uncertainty. In this challenging world, a principal way
to cope with the rampant uncertainty we face is to simplify, that is,
 WHAT IS ECOLOGICAL RATIONALITY? 17

to ignore much of the available information and use fast and frugal
heuristics. And yet this approach is often resisted: When a forecast-
ing model does not predict a criterion, such as the performance of
funds, as well as hoped, the gut reaction of many people, experts
and novices alike, is to do the opposite and call for more informa-
tion and more computation. The possibility that the solution may
lie in eliminating information and fancy computation is still
unimaginable for many and hard to digest even after it has been
demonstrated again and again (see chapter 3).

Number of Alternatives In general, problems with a large number of

alternatives pose difficulties for optimization methods. The term
alternatives can refer to individual objects (such as funds) or actions
(such as moves in a game). Even in many cases where there is an
optimal (best) sequence of moves, such as in chess, no computer or
mind can determine it, because the number of alternative action
sequences is too large and the problem is computationally intrac-
table. The computer chess program Deep Blue and human chess
masters (as well as Tetris players—see Michalewicz & Fogel, 2000)
have to rely instead on nonoptimizing techniques, including heu-
ristics. And people in more mundane everyday settings char-
acterized by an abundance of choices—such as when browsing
supermarket shelves or comparing phone service plans—are indeed
generally able to employ decision strategies to deal effectively
with numerous alternatives (Scheibehenne, Greifeneder, & Todd,
2010).

Sample Size In general, the smaller the sample size of available data
in the environment, the larger the advantage for simple heuristics.
One of the reasons is that complex statistical models have to esti-
mate their parameter values from past data, and if the sample size is
small, then the resulting error due to “variance” can exceed the error
due to “bias” in competing heuristics (see chapter 2). What consti-
tutes a small sample size depends on the degree of uncertainty, as
can be seen in the investment problem, where uncertainty is high:
In this case, a sample size of hundreds of years of stock data is
needed for the mean–variance portfolio to surpass the accuracy of
the 1/N rule.
There are many other important types of environment struc-
ture relevant for understanding ecological rationality. Two of
the major ones also considered in this book are redundancy and
variability.

Redundancy How highly correlated different cues are in the environ-

ment is an indication of that environment’s redundancy. This structure
18 THE RESEARCH AGENDA

can be exploited by heuristics such as take-the-best that rely on

the first good reason that allows a decision to be made and ignore
subsequent redundant cues (see chapters 8 and 9).

Variability The variability of importance of cues can be exploited by

several heuristics. For instance, when variability is high, heuristics
that rely on only the best cue perform better than when the vari-
ability is low (Hogarth & Karelaia, 2005a, 2006b; Martignon &
Hoffrage, 2002; see also chapter 13).
Note that our use of the term environment is not identical with
the physical or “objective” environment (Todd, 2001). For instance,
the first environment structure we discussed above, uncertainty,
comprises aspects of both the external environment (its inherent
unpredictability, or ontic uncertainty) and the mind’s limited under-
standing of that environment (epistemic uncertainty). Thus, the
degree of uncertainty is a property of the mind–environment system.
Similarly, the number of alternatives and the sample size depend
both on what is available in an environment and what an agent actu-
ally includes in its consideration set (such as the number N of funds
to be decided upon). Finally, redundancy and variability of cues
depend on what information is available in the physical environ-
ment, and also on what the decision makers actually perceive and
attend to, which can result in a more or less redundant and varying
set of cues to use. People in groups, for instance, tend to consider
redundant cues, but they could choose to explore further and dis-
cover more independent cues, and in this way partly create their
environment (see chapter 13). Thus, the environment considered in
ecological rationality is the subjective ecology of the organism that
emerges through the interaction of its mind, body, and sensory organs
with its physical environment (similar to von Uexküll’s, 1957, notion
of Umwelt).

Sources of Environment Structure

The patterns of information that decision mechanisms may (or may
not) be matched to can arise from a variety of environmental pro-
cesses, including physical, biological, social, and cultural sources.
Some of these patterns can be described in similar ways (e.g., in
terms of uncertainty or cue redundancy), but others are unique to
particular domains (e.g., the representation of medical informa-
tion). For humans and other social animals, the social and cultural
environment composed of other conspecifics can be just as impor-
tant as the physical or biological, and indeed all four interact
and overlap. For instance, an investment decision can be made
individually and purchased on the Internet without interacting
with anyone else, but the stock market itself is driven by both nature
 WHAT IS ECOLOGICAL RATIONALITY? 19

(e.g., a disastrous hurricane) and other people (e.g., the public reac-
tion to a disaster). Each of the heuristics in Table 1-1 can be applied
to social objects (e.g., whom to hire, to trust, to marry) as well
as to physical objects (e.g., what goods to buy). As an example, the
recognition heuristic (see chapters 5 and 6) exploits environment
structures in which lack of recognition is valuable information and
aids inferences about, say, what microbrew to order and where to
invest, but also whom to talk to and whom to trust (“don’t ride with
a stranger”). Similarly, a satisficing heuristic can be used to select a
pair of jeans but also choose a mate (Todd & Miller, 1999), and the
1/N rule can help investors to diversify but also guide parents in
allocating their time and resources equally to their children.
Environment structures are also deliberately created by institu-
tions to influence behavior. Sometimes this is felicitous, as when
governments figure out how to get citizens to donate organs by
default, or design traffic laws for intersection right-of-way in a hier-
archical manner that matches people’s one-reason decision mecha-
nisms (chapter 16). In other cases, institutions create environments
that do not fit well with people’s cognitive processes and instead
cloud minds, accidentally or deliberately. For instance, informa-
tion about medical treatments is often represented in ways that
make benefits appear huge and harms inconsequential (chapter 17),
casinos set up gambling environments with cues that make gam-
blers believe the chance of winning is greater than it really is
(chapter 16), and store displays and shopping websites are crowded
with long lists of features of numerous products that can confuse cus-
tomers with information overload (Fasolo, McClelland, & Todd, 2007).
But there are ways to fix such problematic designs and make new
ones that people can readily find their way through, as we will see.
Finally, environment structure can emerge without design
through the social interactions of multiple decision makers. For
instance, people choosing a city to move to are often attracted by
large, vibrant metropolises, so that the “big get bigger,” which can
result in a J-shaped (or power-law) distribution of city populations
(a few teeming burgs, a number of medium-sized ones, and numer-
ous smaller towns). Such an emergent distribution, which is
seen in many domains ranging from book sales to website visits,
can in turn be exploited by heuristics for choice or estimation
(chapter 15). Similarly, drivers seeking a parking space using a par-
ticular heuristic create a pattern of available spots that serves as the
environment for future drivers to search through with their own
strategies, which may or may not fit that environment structure
(chapter 18). In these cases, individuals are, through the effects
of their own choices, shaping the environment in which they
and others must make further choices, creating the possibility of a
co-adapting loop between mind and world.
 20 THE RESEARCH AGENDA

What We Already Know

To answer our questions about ecological rationality—when

and why different decision mechanisms in the mind’s adaptive
toolbox fit to different environment structures—we must build on a
growing foundation of knowledge about bounded rationality
and the use of heuristics. This was largely unknown territory in
1999 when we published Simple Heuristics That Make Us Smart,
laying out the program on which the present book is based. Since
then, an increasing number of researchers have contributed to
the exploration of this territory, providing evidence that people rely
on heuristics in situations where it is ecologically rational and
demonstrating the power of appropriate heuristics in the wild,
including business, medical diagnosis, and the law. Here we briefly
review the progress made that supports the work reported in this
book.

What Is in the Adaptive Toolbox?

To study the ecological rationality of heuristics, we must first iden-
tify those being used. Table 1-1 provides an indication of the range
of heuristics that have been studied, but there are numerous others.
We know that many of the same heuristics are relied on by humans
and other animal species (Hutchinson & Gigerenzer, 2005). There is
now considerable evidence of the use of heuristics that make no
trade-offs between cues, such as take-the-best (chapter 9) and elim-
ination-by-aspects (Tversky, 1972). Recent studies have provided
further evidence for such so-called noncompensatory strategies in
consumer choice (Kohli & Jedidi, 2007; Yee, Hauser, Orlin, & Dahan,
2007). Related “one reason” decision heuristics have also been
proposed for another domain, choices between gambles, that has
traditionally been the realm of weighting-and-adding theories,
but the evidence for these mechanisms, such as the priority heuris-
tic (Brandstätter, Gigerenzer, & Hertwig, 2006; Katsikopoulos &
Gigerenzer, 2008), is under debate (e.g., Brandstätter, Gigerenzer, &
Hertwig, 2008; Johnson, Schulte-Mecklenbeck, & Willemsen, 2008).
Other recently investigated heuristics in the adaptive toolbox are
instead compensatory, combining more than one piece of informa-
tion while still ignoring much of what is available (e.g., tallying and
take-two—see chapters 3 and 10).
Among humans, an individual’s adaptive toolbox is not fixed—
its contents can grow as a consequence of development, individual
learning, and cultural experience. But little is known about how the
set of available tools changes over the life course, from birth to death
(Gigerenzer, 2003). Preliminary results suggest that age-related cog-
nitive decline leads to reliance on simpler strategies; nevertheless,
 WHAT IS ECOLOGICAL RATIONALITY? 21

young and old adults seem to be equally adapted decision makers

in how they adjust their use of heuristics as a function of environ-
ment structure (Mata, Schooler, & Rieskamp, 2007). This result
leads to the next issue.

How Are Heuristics Selected?

Ecologically rational behavior arises from the fit between the
current task environment and the particular decision mechanism
that is applied to it—so to study such behavior, we must also
know what heuristics an individual has selected to use. In their
seminal work on the adaptive decision maker, Payne, Bettman, and
Johnson (1993) provided evidence that people tend to select heuris-
tics in an adaptive way. This evidence focused on preferential
choice, where there is no objectively correct answer. Subsequently,
similar evidence was obtained for the ecologically rational use of
heuristics in inductive inference, where decision accuracy can be
assessed (e.g., Bröder, 2003; Dieckmann & Rieskamp, 2007; Pohl,
2006; Rieskamp & Hoffrage, 2008; Rieskamp & Otto, 2006). The
observation that people tend to rely on specific heuristics in appro-
priate situations where they perform well raised a new question:
How does the mind select heuristics from the adaptive toolbox?
This mostly unconscious process is only partly understood, but
three selection principles have been explored.

Memory Constrains Selection First, consider making a selection among the

top three heuristics in Table 1-1: the recognition heuristic, the flu-
ency heuristic, and take-the-best. Say we are betting on a tennis
match between Andy Roddick and Tommy Robredo. What strategy
can we use to select a winner before the start of the match? If
we have heard of Roddick but not of Robredo, then this available
information in memory restricts the strategy choice set to the recog-
nition heuristic alone (which in this case may well lead to a correct
prediction—the two contestants have played each other many times,
with Roddick usually winning); if we have heard of both players but
know nothing except their names, this restricts the choice to the flu-
ency heuristic (see chapter 6); and if we have heard of both and
know some additional facts about them, then we can choose between
the fluency heuristic and take-the-best. If neither player’s name is in
our memory, then none of these three heuristics applies. This does
not mean that we have to guess—we can check the current odds and
then imitate the majority, betting on the player whom most others
also favor (Table 1-1). Thus, the information available in the deci-
sion maker’s memory constrains the choice set of heuristics
(Marewski & Schooler, 2011), creating a first heuristic selection
principle.
22 THE RESEARCH AGENDA

Learning by Feedback The available information in memory limits what

heuristics can be used. But if there are still multiple alternative
heuristics to choose from, feedback from past experience can
guide their selection. Strategy selection theory (Rieskamp & Otto,
2006) provides a quantitative model that can be understood in
terms of reinforcement learning, where the unit of reinforcement
is not a behavior, but a heuristic. This model makes predictions
about the probability that a person selects one strategy within
a defined set of strategies (e.g., the set that remains after memory
constraints).

Ecological Rationality The third selection principle relies on the struc-

ture of the environment, as described by the study of ecological
rationality. For instance, the recognition heuristic is likely to lead
to accurate (and fast) judgments if the validity of recognition infor-
mation is high; that is, if a strong correlation between recognition
and the criterion exists, as is the case for professional tennis play-
ers and the probability that they will win a match. There is experi-
mental evidence that people tend to rely on this heuristic if the
recognition validity is high, but less so if it is low or at chance level
(see chapter 5). For instance, Pohl (2006) reported that 89% of par-
ticipants relied on the recognition heuristic in judgments of the
population of Swiss cities, where their recognition validity was
high, but only 54% in judgments of distance of those cities to the
center of Switzerland, where recognition validity was near chance.
Thus, the participants changed their reliance on the recognition
heuristic in an ecologically rational way when judging the same
cities, depending on the correlation between recognition and the
criterion.
This suggests that choosing to use the recognition heuristic
involves two processes: first, assessing recognition to see whether
the heuristic can be applied—the application of the memory con-
straints mentioned above; and second, evaluation to judge whether
it should be applied—the assessment of the ecological rationality
of the heuristic in the current situation. This is further supported
by fMRI results (Volz et al., 2006) indicating specific neural activity
corresponding to these two processes. Whether a similar combina-
tion of processes applies to the selection of other heuristics must
still be explored.

Are There Individual Differences in the Use of Heuristics?

If individuals all used the same heuristics when facing the
same situations, they would exhibit the same degree of ecological
 WHAT IS ECOLOGICAL RATIONALITY? 23

rationality. But while a majority typically rely on the same particu-

lar heuristic in experimental situations, others vary in the decision
mechanisms they employ, both between individuals and intra-
individually over time. Why would such individual variation exist?
Part of the answer lies in differences in experience that lead people
to have different strategies in their adaptive toolbox or to select
among the tools they have in different ways. But some researchers
have also sought personality traits and attitudes as the roots of these
differences in use of decision strategies that can lead some people
to be more rational (ecologically or logically) than others (e.g.,
Stanovich & West, 2000; see chapter 9).
Individual differences in heuristic use may not, however, indicate
differences in ecological rationality. There are at least two ecologi-
cally rational reasons for inter- and intra-individual strategy varia-
tion: exploratory behavior and flat performance maxima. Exploratory
behavior can be useful to learn about the choice alternatives and
cues available and their relative importance (or even about what
heuristics may be applicable in the current situation). It often takes
the form of trial-and-error learning and leads to individual differ-
ences and to what looks like intra-individual inconsistency in the
use of heuristics, but exploratory behavior can also often result in
better performance over the longer term. On the other hand, an envi-
ronment shows flat maxima when two or more heuristics lead to
roughly equal performance. In such a setting, different individuals
may settle on using one or another essentially equivalent strategy (or
even switch between them on different occasions) and show no dif-
ference in performance or hence, ecological rationality.
With sufficient appropriate experience, performance differences
can appear, coupled with differences in use of decision strategies.
In general, experts know where to look and tend to rely on limited
search more often than laypeople do (Camerer & Johnson, 1991).
This is illustrated by a study on burglary in which graduate stu-
dents were given pairs of residential properties described by eight
binary cues, such as apartment versus house, mailbox empty versus
stuffed with letters, and burglar alarm system present versus lack-
ing (Garcia-Retamero & Dhami, 2009). The students were asked
which property was more likely to be burgled. Two models of
cognitive processes were tested: weighting and adding of multi-
ple pieces of information and the take-the-best heuristic, which
bases its decision on only the most important discriminating
cue. The result was that 95% and 2.5% of the students were classi-
fied as relying on weighting-and-adding and take-the-best, respec-
tively. Normally, psychology experiments stop here. But the
authors then went on to study experts, in this case burglars from an
English prison who reported having committed burglary, on average,
24 THE RESEARCH AGENDA

57 times. The burglars’ decisions were based on different cognitive

processes; 85% of the men were classified as relying on take-the-
best and only 7.5% on weighting-and-adding. A second expert
group, police officers who had investigated residential burglaries,
showed the same predominance of take-the-best. The weighting-
and-adding process among students may largely reflect exploratory
behavior. These findings are consistent with other studies conclud-
ing that experts tend to rely on simple heuristics, often on only one
cue, whereas novices sometimes combine more of the available
information (Dhami, 2003; Dhami & Ayton, 2001; Ettenson,
Shanteau, & Krogstad, 1987; Shanteau, 1992).

Why Not Use a General-Purpose Optimizing Strategy Instead of an

Adaptive Toolbox?
Ecological rationality focuses on the fit between different decision
strategies applied by minds in different environmental circum-
stances. If there is only ever one decision mechanism to be applied,
then the question of ecological rationality does not even come up.
Thus, for those scientists who still yearn for Leibniz’s dream of a
universal calculus that could solve all problems or a single general-
purpose optimizing approach to make every decision, the fit
between the mind and the world is irrelevant. Logic, Bayesian sta-
tistics, and expected utility maximization are among the systems
that have been proposed as general-purpose problem-solving
machines. But they cannot do all that the mind can. Logic can solve
neither the investment problem nor the ball-catching task; Bayesian
statistics can solve the first but, as we have seen, not as well as a
simple heuristic, and the expected utility calculus has similar
limits. Still, why not strive for finding a better, more general opti-
mizing method?
In general, an optimization model works by defining a problem
in terms of a number of mathematically convenient assump-
tions that allow an optimal solution to be found and then proving
the existence of a strategy that optimizes the criterion of interest in
this simplified situation. For instance, the mean–variance portfolio
is an optimization model for the investment problem, given some
constraints. But it is important to remember, as the investment
case illustrates, that an optimization model for a tractable setting
does not imply optimal behavior in the unsimplified real world.
One of the main reasons why optimization methods can fall
behind simple heuristics in real-world applications is that they
often do not generalize well to new situations—that is, they are
not as robust as simpler mechanisms. In general, optimization
can only lead to optimal outcomes if it can estimate parameters
with no or minimal error, which requires environments with
 WHAT IS ECOLOGICAL RATIONALITY? 25

low uncertainty and large sample size, among other factors. We

deal extensively with this foundational issue of robustness and
why simple heuristics can lead to more accurate inferences than
sophisticated statistical methods in the next chapter, covering two
important types of uncertainty in prediction. The first is out-of-
sample prediction, where one knows a sample of events in a popu-
lation and has to make predictions about another sample from the
same population. This corresponds to the investment problem,
where the performance of funds up to some time is known, and
predictions are made about the performance in the next month,
assuming the market is stable. As we saw with the investment prob-
lem, simple heuristics like the 1/N rule that avoid parameter esti-
mation can be more robust than optimization methods in the face of
this kind of uncertainty. The second type of uncertainty appears in
out-of-population prediction, where one has information about a
particular population and then predicts outcomes for another pop-
ulation that differs in unknown ways. For instance, when a diag-
nostic system for predicting heart attacks is validated on a sample
of patients in Boston and then applied to patients in Michigan, it
confronts out-of-population uncertainty. Here again, robustness is
vital, and it can be achieved by radically simplifying the decision
mechanism, such as by replacing a logistic regression diagnostic
system with a fast and frugal tree for predicting heart disease
(see chapter 14). (A third type of uncertainty can also occur, related
to novelty and surprise. In this case, whole new choice alternatives
or consequences can appear—for instance, new prey species moving
into a territory due to climate change. To be prepared for such sur-
prises, coarse behavior that appears rigid and inflexible may be
superior to behavior fine-tuned and optimized to a past environment
that was assumed to be stable—see Bookstaber & Langsam, 1985.)
To summarize, despite the widespread use of optimization in
theory (as opposed to actual practice in business or medicine), there
are several good reasons not to rely routinely on this technique as a
strategy for understanding human behavior (Gigerenzer, 2004b;
Selten, 2001). In contrast, the study of the ecological rationality of
a heuristic is more general and does not require replacing the prob-
lem in question with a mathematically convenient small-world
problem (Savage, 1972) that can be optimized. Because it asks in
what environments particular heuristics perform well (and better
than other strategies), ecological rationality focuses on what is good
enough or better, not necessarily what is best.

Why Not Use More Complex Decision Strategies?

Although optimization is unrealistic as a general method for making
decisions, people and other animals could still use strategies that
26 THE RESEARCH AGENDA

are more complex than simple heuristics. Why should decision

makers ever rely on simple mechanisms that ignore information
and forego sophisticated processing? The classical justification is
that people save effort with heuristics, but at the cost of accuracy
(Payne et al., 1993; Shah & Oppenheimer, 2008). This interpreta-
tion of the reason for heuristics is known as the effort–accuracy
trade-off:

Humans and other animals rely on heuristics because infor-

mation search and computation cost time and effort; thus,
they trade off some loss in accuracy for faster and more frugal
cognition.

This view starts from the dictum that more is always better, as
described at the beginning of this chapter—more information and
computation would result in greater accuracy. But since in the real
world, so the argument goes, information is not free and computa-
tion takes time that could be spent on other things (Todd, 2001),
there is a point where the costs of further search exceed the
benefits. This assumed trade-off underlies optimization-under-
constraints theories of decision making, in which information
search in the external world (e.g., Stigler, 1961) or in memory (e.g.,
Anderson, 1990) is terminated when the expected costs exceed its
benefits. Similarly, the seminal analysis of the adaptive decision
maker (Payne et al., 1993) is built around the assumption that heu-
ristics achieve a beneficial trade-off between accuracy and effort,
where effort is a function of the amount of information and compu-
tation consumed. And indeed, as has been shown by Payne et al.’s
research and much since, heuristics can save effort.
The major discovery, however, is that saving effort does not nec-
essarily lead to a loss in accuracy. The trade-off is unnecessary.
Heuristics can be faster and more accurate than strategies that use
more information and more computation, including optimization
techniques. Our analysis of the ecological rationality of heuristics
goes beyond the incorrect universal assumption of effort–accuracy
trade-offs to ask empirically where less information and computa-
tion leads to more accurate judgments—that is, where less effortful
heuristics are more accurate than more costly methods.
These less-is-more effects have been popping up in a variety of
domains for years, but have been routinely ignored, as documented
in chapter 3. Now, though, a critical mass of instances is being
assembled, as shown throughout this book. For instance, in an age
in which companies maintain databases of their customers, com-
plete with historical purchase data, a key question becomes pre-
dicting which customers are likely to purchase again in a given
timeframe and which will be inactive. Wübben and Wangenheim
 WHAT IS ECOLOGICAL RATIONALITY? 27

(2008) found that managers in airline and apparel industries rely

on a simple hiatus heuristic: If a customer has not purchased within
the past 9 months (the “hiatus”), the customer is classified as inac-
tive; otherwise, the customer is considered active. The researchers
compared this hiatus heuristic with a more complex Pareto/nega-
tive binomial distribution (NBD) model, which assumes that pur-
chases follow a Poisson process with a purchase rate parameter λ,
customer lifetimes follow an exponential distribution with a drop-
out rate parameter μ, and across customers, purchase and dropout
rates follow a gamma distribution. For both industries, the simple,
less effortful heuristic correctly classified more customers than the
more computationally costly Pareto/NBD model. Similarly, in library
searches for appropriate references, a one-reason decision heuristic
produced better orders of titles than a Bayesian model and PsychInfo
(Lee, Loughlin, & Lundberg, 2002). Thus, for many decision prob-
lems in the real world, there is an inverse-U-shaped relation between
amount of information, computation, and time on the one hand and
predictive accuracy on the other. There is not always a trade-off
to be made between accuracy and effort—the mind can have it both
ways. The study of ecological rationality tells us when.

Methodology

Progress in science comes through finding good questions, not just

answers. Finding the right answer to the wrong question (some-
times known as a Type III error) is a waste of effort. We believe
the traditional perspective of logical rationality has been posing
the wrong questions—and with the study of ecological rationality,
researchers ask different ones. Consider the question, “Do people’s
intuitive judgments follow Bayes’s rule?” Before 1970, the answer
was yes, people are Bayesians, albeit conservative ones (Edwards,
1968). After 1970, the answer was changed to no: “In his evaluation
of evidence, man is apparently not a conservative Bayesian: he is
not Bayesian at all” (Kahneman & Tversky, 1982, p. 46). Recently,
the answer has swung back toward yes in research on the “Bayesian
brain” (Doya, Ishii, Pouget, & Rao, 2007) and new Bayesian models
of reasoning (Tenenbaum, Griffiths, & Kemp, 2006). This inconsis-
tency over time indicates that this yes/no question is probably the
wrong one, whatever the answers are. From the perspective of
the adaptive toolbox, the mind has several tools, not just Bayesian
probability updating, and the better question is, “In what envi-
ronments do people use particular strategies?” The follow-up ques-
tion is, “When (and why) are particular strategies ecologically
rational?”
28 THE RESEARCH AGENDA

There are three essential components in these better questions:

heuristics and other decision strategies (in the plural), environment
structures (in the plural), and statements about ecological rational-
ity. Thus, to answer these questions, we need a research program
consisting of several steps that get at each of these components,
including the following:

1. Design computational models of heuristics and specify

structures of environments.
2. Use analysis and computer simulation to study the ecologi-
cal rationality of each heuristic, given various environment
structures, using accuracy or some other criterion.
3. Empirically test whether people’s (a) behavior and (b) cog-
nitive processes can be predicted by particular heuristics
fit to a given environment.
4. Use the results to construct a systematic theory of the
adaptive toolbox and its ecological rationality.

All of these steps can be applied to understand the ecological ratio-

nality of other species besides humans. For humans in particular,
we can also add another step to apply the research program to fur-
ther real-world problems (see chapters 16 and 17):

5. Use the results to design environments and expert systems

to improve decisions.

Note that computational models of heuristics are specific models

of cognitive processes (termed proximal mechanisms in biology),
including the building blocks for information search, stopping
search, and decision. As indicated in step 3, they can predict both
an individual’s (or group’s) decision process and the resulting
behavior, and they should be tested against both. For instance,
consider two competing hypotheses about how outfielders catch a
ball: relying on the gaze heuristic or computing the ball’s trajectory.
Each assumes different cognitive processes that lead to different
measurable behavior. Trajectory computation predicts that players
first estimate the point where the ball will come down, then run as
fast as they can to this point and wait for the ball. In contrast, the
gaze heuristic predicts that players catch the ball while running,
because they constantly have to adjust their angle of gaze. The heu-
ristic makes further predictions that the trajectory computation
theory does not make, including the pattern of players’ changes in
speed while running and that in certain situations players will
run in a slight arc rather than in a straight line. These predicted
behaviors have been observed and documented, supporting the use
 WHAT IS ECOLOGICAL RATIONALITY? 29

of the gaze heuristic and its variants (Saxberg, 1987; Shaffer &
McBeath, 2005 Todd, 1981). Furthermore, the predicted process of
trajectory computation implies that players will calculate where a
ball will land, whereas the gaze heuristic makes no such predic-
tion. Comparing these process-level predictions can help explain
an apparent fallacy on the part of expert players—that they are
not able to say where a ball will come down (e.g., Saxberg, 1987).
When using the gaze heuristic, players would not have this ability,
because they would not need it to catch the ball. Such an analysis
of heuristics and their ecological rationality can thus help research-
ers to avoid misjudging adaptive behavior as fallacies (Gigerenzer,
2000).
There are a number of useful methodological considerations that
are prompted by the study of ecological rationality. First, research
should proceed by means of testing multiple models of heuristics
(or other strategies) comparatively, determining which perform best
in a particular environment and which best predict behavior
observed in that environment. This enables finding better models
than those that already exist, not just assessing only one model in
isolation and then proclaiming that it fits the data or not. Second,
given the evidence discussed earlier for individual differences in
the use of heuristics, the tests of predictive accuracy should be
done at the level of each individual’s behavior, not in terms of
sample averages that may represent few or none of the individuals.
Finally, because individuals may vary in their own use of heuristics
as they explore a new problem, experiments should leave individu-
als sufficient time to learn about the alternatives and cues, and
researchers should not confuse trial and error exploration at the
beginning of an experiment as evidence for weighting and adding
of all information.
Several studies of heuristics exemplify these methodological
criteria. For instance, Bergert and Nosofsky (2007) formulated a
stochastic version of take-the-best and tested it against an additive-
weighting model at the individual level. They concluded that the
“vast majority of subjects” (p. 107) adopted the take-the-best strat-
egy. Another study by Nosofsky and Bergert (2007) compared take-
the-best with both additive-weighting and exemplar models of
categorization and concluded that “most did not use an exemplar-
based strategy” but followed the response time predictions of take-
the-best. There are also examples where not following some of these
criteria has led to results that are difficult to interpret. For instance,
if a study on how people learn about and use cues does not provide
enough trials for subjects to explore and distinguish those cues,
then lack of learning cannot be used as evidence of inability to learn
or failure to use a particular heuristic (e.g., Gigerenzer, Hertwig, &
 30 THE RESEARCH AGENDA

Pachur, 2011). This shows another benefit of comparative testing:

If there are such flaws in the experimental design, they will hurt all
models tested equally, not just one.
In sum, studying ecological rationality requires computational
models of heuristics (and other strategies) that are tested at the level
of individual behavior, in a range of appropriate environments,
and in a comparative way. Progress relies on analytical proof, com-
puter simulation, and empirical studies in the field and in the lab,
and on developing a conceptual language for the structures of heu-
ristics and environments and the fit between the two.

The Rational and the Psychological

The message of this book is to study mind and environment in

tandem. Intelligence is in the mind but also in the world, inherent
in the structures in our physical, biological, social, and cultural
surroundings. The traditional view of heuristics as lazy mental
shortcuts, falling short of some idealized vision of general rational-
ity, relegates the study of heuristics to merely a descriptive role. It
draws a strict line between how behavior is and how it should be,
with psychology answering the first question but silent on the
second, the territory of logic and probability theory. The study of
ecological rationality overthrows this separation of the psychologi-
cal and the rational and creates a descriptive and prescriptive role
for heuristics. In the right environment, a heuristic can be better
than optimization or other complex strategies. Rationality and psy-
chology both emerge from the meeting of the two blades of Herbert
Simon’s scissors, the mental and the environmental.