In this video, Professor Gilboa explains how theory can be used in decision making, but why it was unable to predict the financial crisis of 2008. Ideally, theory would predict everything numerically and accurately yet the complexity of our world renders this impossible. Despite this, he stresses that it would be a serious mistake to assume that the mathematically based theory of decision-making has nothing to teach us; intuition has its own merits, but we cannot rely on this alone. Gilboa also discusses the uses and limitations of Decision Science, reconciling classical rationality and gut feelings, and gives the definition of a ‘good decision’ - the result of a dialogue between theory and intuition.
His main interest is decision theory, and, more specifically, the theory of decision under uncertainty, focusing on the definition of probability, notions of rationality, non-Bayesian decision models, and related issues.