I replace the assumption of individual optimization, common in economic literature, by an assumption that an individual executes a computational algorithm directed at finding the choice that is good at the time the choice is made. The general properties of such algorithm are studied

This paper develops a theoretical framework for analyzing incentive schemes under bounded rationality. It starts from a standard principal-agent model and then superimposes an assumption of boundedly rational behavior on the part of the agent. Boundedly rational behavior is modeled as an...