Satisficing

Definition

Satisficing refers to making a decision with the goal of satisfying or fulfilling some acceptable minimum requirement (instead of choosing the best option). Decision makers who adopt a satisficing strategy do not evaluate all the available alternatives. Instead, they accept the first “good enough” option that they encounter. Satisficing is thought to be a useful decision-making strategy given that people live with limited information-processing capacity in a world of complicated and difficult choices. The cost of expending the resources required to evaluate every available option is thought to be greater than the additional value that will be gained by selecting the best option instead of the good enough option. Satisficing is typically discussed as an alternative to maximizing (maximizing the value of a decision by comparing the value of all options and selecting the best one).

Background and History

Historically, rational choice theory has strongly influenced how people study and think about decision making. When John von Neumann and Oskar [Page 777]Morgenstern published Theory of Games and Economic Behavior in 1944, they introduced several different elements of rational decision making to the field of economics. Expected utility theory specifies that decision makers can assign an expected value to every alternative course of action. After an expected utility is assigned to every option, the alternative with the highest expected value will be selected.

However, although von Neumann and Morganstern's work played a key role in the field of economics, psychologists began to demonstrate key ways in which actual decision makers systematically deviate from rational choice models. In the 1950s, Nobel Prize winner Herbert Simon (economist and psychologist) published a series of papers in which he suggested that it is more useful to approach the study of decision making by acknowledging that actual decision makers have to approach complicated choices with limited information and limited cognitive resources available to them. Rational choice theory requires that all options can be thoroughly evaluated, which is not the case in the real world. Simon was the first to coin the term satisficing when he suggested that decision makers conserve resources by choosing to fulfill some minimum requirement instead of maximizing expected value. In more recent years, psychologist Barry Schwartz borrowed Simon's term and discovered that individual people differ in the degree to which they tend to approach decisions with the goal of satisficing.

Individual Differences

Schwartz divided the world into “satisficers” versus “maximizers” when he identified existing individual differences in people's tendencies to approach decisions with the goal of satisficing versus maximizing. He measured these differences through a maximization scale that he developed and administered to several thousand participants. Following are some examples of items found on the maximization scale:

Participants rated each statement on a 1 to 7 scale (ranging from completely disagree to completely agree). Schwartz did not define a strict cutoff that identifies maximizers versus satisficers, but he generally calls people maximizers if their average score is higher than 4 for all the items. Satisficers generally have an average score of less than 4. The distribution of scores for his participants was relatively symmetrical about the midpoint of the scale. About one third received an average score of more than 4.75 and one third scored under 3.25. The final third scored closer to the middle, somewhere between 3.25 and 4.75. In addition, approximately 1 of every 10 participants had an average score of more than 5.5 (extreme maximizers), and similarly, about 1 of every 10 had an average score of less than 2.5 (extreme satisficers).

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