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(1998) Rationality in economics, Dordrecht, Springer.
If we perform the pedantic exercise of explaining the word "rational" according to its roots, we would see that it means "according to rule". And from some points of view, rational behavior is behavior according to rule. Simon, Newell, and their followers in cognitive science, for example, see rationality in this light; and Nozick observes that rules can have certain advantages which lead us to think of them as "rational", such as coherence, consistency with precedents, and testable consistency with common principles. However, the common concept of rationality in neoclassical economics is quite different. Neoclassical economics holds that it is rational to maximize some sort of utility function or preference ranking. It may be possible to state rules that are necessary and perhaps sufficient for this maximization to be realized, but these rules are derivative, and if it should turn out that there are no rules that express the maximization (for example if the maximum problem has no analytic solution), then so much the worse for rules.
Publication details
DOI: 10.1007/978-94-011-4862-7_4
Full citation:
McCain, R. A. (1998)., The logic of rationality: modal and defeasible, in K. Dennis (ed.), Rationality in economics, Dordrecht, Springer, pp. 33-53.
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