THE RATIONAL CHOICE THEORY



The Rational Choice Theory



The Rational Choice Theory

The notions of rationality, rational choice, and rational beliefs have a central place in many of the social sciences. Although originally deployed mainly in economics, they are increasingly being incorporated into sociology and political science. (They have not gained the same importance in social anthropology.) Some scholars argue that by virtue of its simplicity, universality and explanatory power the theory of rational choice is, or should be, the unifying framework for all the social sciences. As an explanatory theory it harbors formal and empirical problems that suggest a need for alternative approaches. At the same time, whatever its explanatory flaws, the notion of rationality retains a normative privilege, because we want to be rational (Føllesdal 1982). Rational choice theory is primarily prescriptive: it tells agents what to do to achieve their ends as well as possible. Social scientists may then try to explain their behavior by assuming that they do what the theory tells them to do.

The Development of Rational Choice Theory

The modern notion of rationality did not emerge until this century. Earlier references to rationality were to ratio, or 'reason,' understood as the faculty of calm and deliberative choice, as opposed to emotion. In the words of David Hume (1960, p.415), 'Reason is, and ought only to be, the slave of the passions.' Some writers opposed reason both to interest and emotion: 'Nothing is easier for passion than to overcome reason; its greatest triumph is to conquer interest' (De La Bruyère 1990, IV.77). In this tradition, reason implies not only a dispassionate but also a disinterested and impartial attitude.

The Economic Meaning of Rationality

The modern concept of rationally as, essentially, means-end efficiency owes much to the marginalist revolution in economics in the last third of the nineteenth century. By conceptualizing the consumer's choice and the producer's choice as involving trade-offs among different consumption goods or different factors of production, the marginalists made it possible to think more systematically about the optimal choice of means for a given end. A profit-maximizing employer, for instance, would react to a wage increase by using more nonlabor inputs and less labor.

Max Weber

In Economy and Society, Weber (1968, p.24) offered an influential definition of instrumentally rational (zweckrational) action: it is 'determined by expectations as to the behavior of objects in the environment and of other human beings; these expectations are used as “conditions” or “means” for the attainment of the actor's own rationally pursued and calculated ends.' Although Weber's professed aim was to offer a purely subjective notion of rationality as coherence among action, ends, and beliefs, some of his analyses point to a more objective definition in terms of successful adaptation to the environment (Elster 2000). The closing pages of the Protestant Ethic (Weber 1958) suggest that he was influenced by the fact that market competition generates objectively successful behavior by eliminating those who fail.

The Emergence of Game Theory

Weber (1968) writes that 'in attempting to explain the campaign of 1866, it is ...