Bounded Rationality Dominates Decision Making
Consensual knowledge is certainly not an essential ingredient in the introduction of innovations in policy or institutional design. The kind of knowledge that is the property of actors who do not subject their beliefs to systematic verification tests—ideology, in short—undoubtedly is often a sufficient explanation for change. Some guidance from an ideology is required even for minor changes of the means of action. Programmatic innovation that dispenses with consensual knowledge is common. It is perfectly consistent with adaptive behavior, nationally and internationally. As such, it will concern us later in our exploration.
Innovation due to the emergence of consensual knowledge entails a
major questioning of prior cause-effect schemata.[11]
One variant of innovation results from a revolutionary upheaval; another is based on a major cognitive development in how adherents of clashing ideologies come to see the world. When a revolution sweeps away a rival view of the world and the revolutionaries succeed in imposing their unified view on the rest of the population, a new kind of knowledge certainly inspires ensuing innovations. But it is not the kind of knowledge that emerges from a confrontation and testing of rival explanations. Since political revolutions do not occur in international politics, this variant is not relevant to my enterprise.
Few such cognitive breakthroughs are on record in the histories of international organizations. The field of public health perhaps comes closest. Even the Keynesian consensus that inspired twenty years of international trade and monetary programs came to an end. Most programmatic innovations feature an unstable mixture of slowly changing political interests (rooted in values and ideologies) and bits and pieces of consensual knowledge. That knowledge is specific to professional disciplines and to discrete issues on the political agenda such as the creation of wealth and its diffusion, the interplay of wealth creation and the diffusion of technology, the link between food production and environmental protection, and the protection of population groups thought to be especially vulnerable. Consensual knowledge is not total wisdom to guide the world to eternal bliss.The questioning of prior cause-effect beliefs, in short, is not a "rational" process if judged by strict standards of rational choice. Matters proceed in a much sloppier way. Thought about environmental protection and resource conservation exemplifies the sloppiness. Here, a change in the urgency for choice made politicians seek out bodies of knowledge thought likely to advance their instrumental cause. The creators of that knowledge may also seek out friendly politicians as likely allies. Before the claims to knowledge become truly consensual, the interplay will take the form of an ideological debate, as happened in the early days of the international environmental movement when the interests of the developed and the developing worlds were at loggerheads. Because of the phenomenon of "embedded liberalism," Keynesian macroeconomics provided the consensual knowledge of the Bretton Woods system even though, ten years earlier, that same body of thought still had the trappings of an ideology in the United States.[12]
John Gerard Ruggie, "International Regimes, Transactions and Change," International Organization 36 (Spring 1982): 379-416.
Since I am unable to predict when the interplay of interest and knowledge becomes stable, I can claim only that learning has an elective affinity with the more fundamental changes in scientific and technical understanding, though not in the form of rational choice Weber termed "technical" and Herbert Simon calls "substantive.""If we accept values as given and consistent," says Simon,
if we postulate an objective description of the world as it really is, and if we assume that the decisionmaker's computational powers are unlimited, then two important consequences follow. First, we do not need
to distinguish between the real world and the decisionmaker's perception of it; he or she perceives the world as it really is. Second, we can predict the choices that will be made by a rational decisionmaker entirely from our knowledge of the real world and without a knowledge of the decisionmaker's perceptions or modes of calculation. (We do, of course, have to know his or her utility function.)[13]
Herbert A. Simon, "Rationality in Psychology and Economics," in Rational Choice, ed. Robin M. Hogarth and Melvin W. Reder (Chicago: University of Chicago Press, 1986), 26-27. Also see Simon's Reason in Human Affairs (Stanford, Calif.: Stanford University Press, 1983), chap. 2, and "Human Nature in Politics," American Political Science Review 79 (June 1985) 293-304. Learning, then, consists of recognizing a different process of decision making, not the realization of specific values. The values will differ with the issue or problem in question and with the coalition undertaking the revaluation. They cannot be prespecified in principle. Can this conception of learning take hold in real organizations without overcoming the forces that make for motivated errors in decision making? We will consider this question below.
This situation represents substantive rationality. It is not encountered in the world of international organizations.
International organizations choose "under ambiguity." Decision making "under ambiguity" differs fundamentally from what is normally considered to be rational behavior by individuals seeking to optimize or maximize. Problems of ambiguity arise under the following conditions: Determined or even probable outcomes are rarely associated with a decision-making routine. Choice is often constrained by a condition of strategic interdependence in which the opposing choosers find themselves, a condition of which they are fully aware. Preferences are often not clear, or not clearly ordered, because the decision is not being made by a single individual, but by a bureaucratic entity. There may also be a mismatch between the assumed causal links constituting the problem the organization is called upon to resolve and the causal theory underlying the internal arrangements of units, plans, and programs designed to solve the problem. Decision-making models that are supposed to draw on the lessons of history, that are predicated on the assumption that actors deliberately learn from prior mistakes, are badly flawed because the lessons of history are rarely unambiguous: different actors certainly offer varying and equally plausible interpretations of past events that often mar decision making in the present. Learning, under such circumstances, consists of recognizing the desirability of a different process of decision making, a process that copes a little "better" with ambiguity. Learning explicitly avoids specifying what, substantively speaking, ought to be learned. Under procedural rationality, learning means designing and mastering an alternative process.[14]
James G. March, Decisions and Organizations (London: Basil Blackwell, 1988), 12-14. March mentions a final ambiguity—"decision-making is a highly contextual, sacred activity, surrounded by myth and ritual, and as much concerned with the interpretive order as with the specifics of particular choices" (ibid., 14)—which strikes me as being more applicable to the study of the World Council of Churches than to the United Nations and its agencies.
It follows that, given these constraints on substantive rationality, a decision cannot be rational normatively as well as descriptively. Decision making designed to seek optimal outcomes is normatively rational; any account of why such decisions fail to attain optimum outcomes is
both descriptive of a process and evaluative about its consequence. Decision making conceded to be less than substantively rational can only be described accurately, not evaluated normatively. Decisions made "under ambiguity" remain rational because the choosers do the best they can under the circumstances. They do not act randomly. They attempt to think about trade-offs even though they are unable to rank-order their preferences. In short, they "satisfice." Nothing that is capable of being described systematically is truly irrational even if the rational content cannot be stated normatively.[15]
Amos Tversky and Daniel Kahneman suggest that decisions constrained by all of the unmotivated cognitive errors to which people are subject are still rational according to the canons of bounded rationality. See their "Rational Choice and the Framing of Decisions," in Rational Choice, 67-94.
Hence the notion of "error" and "error correction" becomes problematic.