Bounded Decision Rationality and the Logic of Appropriateness 183
consequences and the decision logic of appropriateness, rationality is bounded,
but it is diff erently bounded. And in the decision logic of consequences and the
decision logic of appropriateness there are patterns of analysis, systematic reason-
ing, and complicated choices. It is an error to assume that, because much of the
decision-theoretic work using the logic of consequences is formal and mathemat-
ical, it deals with complexity, and that decision-theoretic work using the logic of
appropriateness explains simple or less complex decision choices. Both patterns
of reasoning can account for or explain simple or complex patterns of decision-
making (Zey 1992).
Rules and identities are the stuff of formal organizations. “Most people in an
organization execute their tasks most of the time by following a set of well-specifi ed
rules that they accept as part of their identity. Th is is true of doctors in hospitals,
workers on assembly lines, sales representatives in the fi eld, teachers in a class-
room, and police offi cers on a beat. It is also true for those people in organizations
whose tasks primarily involve making decisions. Organizational rules defi ne what
it means to be a decision maker” (March 1994, 60). Th ere are rules of process and
procedure that channel decision processes. Th ere are rules regarding the factors
to be considered in making decisions. Th ere are rules limiting choices (who can
be hired or promoted) and rules allowing choices. Th ere are criteria for evaluat-
ing performance. Th ere are formal and informal rules. Rules are not independent
of the identities of those who work in organizations. Rules frame their identities,
and their identities infl uence organizational rules.
Organizations select individuals who already have identities and tend to be-
have according to rules associated with those identities: professors, doctors, truck
drivers, cops. And organizations socialize individuals to their unique rules. Th is
is because organizations also have identities. Organizational identities are socially
constructed on the understanding of how particular kinds of institutions should
or ought to behave to have legitimacy and standing. Organizational identities can
be highly defi ned—consider the US Marines—or mildly defi ned, such as a small
business.
As can be seen by this description, decision theory following the logic of ap-
propriateness is deeply contextual. Contexts can be highly complex and decision-
making heavily informed by contextual rules and identities fi lled with ambiguity,
uncertainty, risk, imperfect information, and limited attention. Organizations
guide individual action by providing the content of identities and rules and cues
about when and how to make rational decisions. Th ese are the decision rules of
appropriateness. Decisionmaking behavior studied from the vantage of appro-
priateness describes rational action and the processes that guide rational action
quite diff erently from descriptions of the formal analysis of noncontextual deci-
sion experiments.
Because of the relative stability, order, and predictability of formal organi-
zations, one might think that a perspective on rational decisionmaking so em-
bedded in context might tend toward static descriptions of order. Th is is not so.