Normative vs. Descriptive Models

Normative models prescribe how decisions or behaviors *should* be made based on principles of rationality and optimality. They serve as ideal standards or best practices for making choices. Descriptive models, on the other hand, explain how people *actually* behave in real-world situations, often highlighting patterns, biases, and deviations from rationality. While normative models are about ideal decision-making, descriptive models focus on observed behaviors. Both are valuable: normative models guide ideal choices, and descriptive models help us understand actual human behavior.