Ihor Kendiukhov

It is a well-developed position in decision theory, and it comes in, at least, two flavors.

Edward MacLennan developed the theory of resolute choice in his 1990 book Rationality and Dynamic Choice.

The idea is straightforward.

An agent evaluates the entire decision tree before any uncertainty is resolved, selects the plan that is globally optimal over the full trajectory, commits to it, and then executes it step by step without re-evaluating at intermediate nodes.

The cost is giving up consequentialism.

At some intermediate node, the resolute chooser may be executing an action that looks suboptimal if you consider only what's still possible from that node forward.

They are choosing it because it was part of the globally optimal plan and the globally optimal plan was evaluated over the entire tree, including branches that, at this point, have already been resolved.

Is this irrational?

I don't think so.

It is the same thing that anyone does when they follow through on a commitment that has become locally costly but was globally optimal at the time it was made.

subheading sophisticated choice there is a second alternative which goes in a different direction a sophisticated chooser accepts that their preferences at future nodes will differ from their current global evaluation and instead of committing to override those future preferences they predict them and plan around them they do backward induction

Starting from the last decision node, they figure out what they would actually choose there given their local preferences at that node, then step back one node and choose optimally given what they know they will do later, and so on back to the first node.

The sophisticated chooser is also immune to money pumps because they never form a plan that they will later deviate from.

Instead, they form a plan that already accounts for their future deviations.

The cost is different from resolute choice.

Instead of sticking to a globally optimal plan despite local temptation, the sophisticated chooser settles for a plan that may be dominated from the ex-ante perspective but is at least self-consistent in the sense that they will actually follow through on it.

Sophisticated choice is less elegant than resolute choice, and for our purposes less interesting, but it is worth mentioning because it demonstrates the same structural point.

Money pump immunity does not require independence.

Subheading.

Ogedicity economics as a naturally resolute framework.