Satisficing and (un)bounded rationality—A formal definition and its experimental validity

Based on exogenously given or idiosyncratically expected scenarios satisficing is formally defined and shown to include rationality as an unlikely border case. Our approach suggests new ways of defining risk attitudes and has been applied to risky choice problems and (stochastic) market games. Contrary to revealed preferences where one infers goals from observed choices, the experimental tests do not only elicit choice behavior but also aspirations and, if necessary, idiosyncratic expectations.