Thinking and decision making

This chapter develops a pragmatist-enactive account of thinking and decision-making, challenging the dominant view that deliberative and decision processes are primarily internal, "in-the-head" cognitive operations. Standard approaches — from normative decision theory (Subjective Expected Utility) to Herbert Simon's bounded rationality — construe decision-making either as optimization within idealized information structures or as internal computation over a pre-given problem space. Both framings, the authors argue, remain caught within a cognitivist paradigm that treats habit as mere automatic routine and the environment as an external constraint on individual inference. Drawing on the pragmatist philosophy of Charles Sanders Peirce and William James, and on the institutional economics of Thorstein Veblen, the contribution rehabilitates habit as the enabling condition of rational deliberation rather than its suspension. On this account, habits of thought are not compressed inference but evolved and revisable modes of sensorimotor and affective engagement with the world, through which agents constitute — rather than merely navigate — the space of possible actions. Institutions, in turn, are understood as sedimented habits writ large, simultaneously enabling and constraining individual action through what Hodgson calls "reconstitutive downward causation." This pragmatist foundation is then brought to bear on Simon's notion of problem solving. While Simon's ant-on-a-beach parable anticipates an environmentally distributed view of cognition, his framework ultimately retreats to an information-processing model that presupposes a problem space it cannot itself explain. Against this, the paper proposes an enactive reframing in which the problem space is not represented in internal memory but enacted through the agent's habitual coupling with an affordance-rich environment. Enactive problem solving, as developed here, incorporates embodied action, social and communicative interaction, affective appraisal, and institutional scaffolding as constitutive — not merely contextual — dimensions of decision-making. The paper concludes that decision-making is an irreducibly distributed, social, and normatively embedded process in which habit, deliberation, emotion, and institutional structure continuously co-constitute one another.