In this article, we present a contextually embedded choice theory. Using concepts and tools of poset mathematics, we show how to include in rational choice theory cultural and social effects. Specifically, we define some choice superstructures, seen as choice set transformations imposed by cultural and social norms. As we shall argue, these transformations can be of help to explain choice behavior within different contexts. Moreover, we show that, once choice superstructures are taken into account, some well-known results about maximizing and (...) optimizing behavior are easily confirmed and some insights on intransitive choices may be phased out. (shrink)

This paper examines preferences among uncertain prospects when the decision maker is uneasy about his assignment of subjective probabilities. It proposes a two-stage lottery framework for the analysis of such prospects, where the first stage represents an assessment of the vagueness (ambiguity) in defining the problem's randomness and the second stage represents an assessment of the problem for each hypothesized randomness condition. Standard axioms of rationality are prescribed for each stage, including weak ordering, continuity, and strong independence. The ‘Reduction of (...) Compound Lotteries' axiom is weakened, however, so that the two lottery stages have consistent, but not collapsible, preference structures. The paper derives a representation theorem from the primitive preference axioms, and the theorem asserts that preference-consistent decisions are made as if the decision maker is maximizing a modified expected utility functional. This representation and its implications are compared to alternative decision models. Criteria for assigning the relative empirical power of the alternative models are suggested. (shrink)

The most common argument against the use of rational choice models outside economics is that they make unrealistic assumptions about individual behavior. We argue that whether the falsity of assumptions matters in a given model depends on which factors are explanatorily relevant. Since the explanatory factors may vary from application to application, effective criticism of economic model building should be based on model-specific arguments showing how the result really depends on the false assumptions. However, some modeling results in imperialistic applications (...) are relatively robust with respect to unrealistic assumptions. Key Words: unrealistic assumptions • economics imperialism • rational choice • as if • robustness. (shrink)

What behavior is rational? It’s rational to act ethically, some think. Others endorse instrumentalism — it is rational to pursue one’s goals. Still others say that acting rationally always involves promoting one’s self-interest. Many philosophers have given each of these answers. But these answers don’t really conflict; they aren’t vying to describe some shared concept or to solve some mutually acknowledged problem. In so far as this is debated, it is a pseudo-debate. The different uses of ‘rational action’ differ merely (...) in meaning. I shall defend the following claims: ‘rational behavior’ is used in ethical, prudential, and instrumental ways (section 1); these uses of ‘rational behavior’ are distinct (section 2); they do not represent competing theories of rational behavior (section 3); we should stop using ‘rational behavior’ ethically and prudentially, but we may continue its instrumental use (section 4). (shrink)

Political science and economic science . . . make use of the same language, the same mode of abstraction, the same instruments of thought and the same method of reasoning. (Black 1998, 354) Proponents as well as opponents of economics imperialism agree that imperialism is a matter of unification; providing a unified framework for social scientific analysis. Uskali Mäki distinguishes between derivational and ontological unification and argues that the latter should serve as a constraint for the former. We explore whether, (...) in the case of rational-choice political science, self-interested behavior can be seen as a common causal element and solution concepts as the common derivational element, and whether the former constraints the use of the latter. We find that this is not the case. Instead, what is common to economics and rational-choice political science is a set of research heuristics and a focus on institutions with similar structures and forms of organization. (shrink)

There are, broadly speaking, two ways to think about rationality, as defined in the following passage: ‘Reason’ for a long time meant the activity of understanding and assimilating the eternal ideas which were to function as goals for men. Today, on the contrary, it is not only the business but the essential work of reason to find means for the goals one adopts at any given time. To use what Horkheimer called objective reason, and what others have called expressive or (...) non–instrumental reason, is to reflect on one's goals, to attempt to determine what preferences one ought to hold. On the other hand, to use what Horkheimer called subjective reason is to ‘be concerned with means and ends, with the adequacy of procedures for purposes more or less taken for granted’, that is, to be instrumentally rational. This contrast between non-instrumental and instrumental reason is at the heart of many contemporary social and philosophical disputes. 1. (shrink)

Laboratory experimentation was once considered impossible or irrelevant in economics. Recently, however, economic science has gone through a real ‘laboratory revolution’, and experimental economics is now a most lively subfield of the discipline. The methodological advantages and disadvantages of controlled experimentation constitute the main subject of this thesis. After a survey of the literature on experiments in philosophy and economics, the problem of testing normative theories of rationality is tackled. This philosophical issue was at the centre of a famous controversy (...) in decision theory, during which a methodology of normative falsification was first articulated and used to assess experimental results. In the third chapter, the methodological advantages of controlled experimentation are illustrated and discussed with examples taken from the experiments on the so-called ‘preference reversal’ phenomenon. Laboratory testing allows to establish with a high degree of certainty that certain phenomena lie behind the experimental data, by means of independent testing, elimination of alternative hypotheses, and the use of different instruments of observation. The fourth chapter is devoted to a conceptual analysis of the problem of ‘parallelism’. This is the problem of inferring from the occurrence of a phenomenon in the laboratory, to its instantiation also in non-laboratory environments. Experimental economists have discussed parallelism at length, and their views are presented and criticised. Eventually, it is argued that parallelism is a factual matter and as such can only be established on empirical grounds. The fifth chapter provides an example of how one can argue for parallelism, focusing on the case of experimentation on the ‘winner’s curse’ phenomenon. The role of experiments as ‘mediators’ between theoretical models and their target domain of application is illustrated, and the structure of parallelism arguments analysed in detail. Finally, in the last chapter, economic experiments are compared to simulations, in order to highlight their specific characteristics. (shrink)

John Rawls argues that it is possible to describe a suitably defined initial situation from which to form reliable judgements about justice. In this initial situation, rational persons are deprived of information that is . It is rational, Rawls argues, for persons choosing principles of justice from this standpoint to be guided by the maximin rule. Critics, however, argue that (i) the maximin rule is not the appropriate decision rule for Rawls's choice position; (ii) the maximin argument relies upon an (...) imprecise account of the satisfactory minimum to be secured under the maximin rule; or that (iii) Rawls relies upon unrealistic assumptions about diminishing marginal value. These critics, I will suggest, argue from a number of assumptions that are confused or false. The satisfactory minimum that choosers in the original position seek to achieve is not a minimum level of primary goods, nor is the satisfactory minimum sought under the maximin rule supplied by the difference principle. I will argue that the maximin argument is more robust than has generally been recognized and that this argument performs a number of important functions in clarifying the nature and implications of Rawls's argument for justice as fairness. (shrink)

A generalized theory of revealed preference is formulated for choice situations where the consequences of choices from given menus are uncertain. In a nonprobabilistic framework, rational choice behavior can be defined by requiring the existence of a preference relation on the set of possible consequences and an extension rule for this relation to the power set of the set of consequences such that the chosen sets of possible outcomes are the best elements in the feasible set according to this extension (...) rule. Rational choice is characterized under various assumptions on these relations. (shrink)

Over the last fifty years, traditional farming has been replaced by industrial farming. Unlike traditional farming, industrial farming is abhorrently cruel to animals, environmentally destructive, awful for rural America, and wretched for human health. In this essay, I document those facts, explain why the industrial system has become dominant, and argue that we should boycott industrially produced meat. Also, I argue that we should not even kill animals humanely for food, given our uncertainty about which creatures possess a right to (...) life. In practice, then, we should be vegetarians. To underscore the importance of these issues, I use statistics to show that industrial farming has caused more pain and suffering than the Holocaust. (shrink)

Expected-utility theory has been a popular and influential theory in philosophy, law, and the social sciences. While its original developers, von Neumann and Morgenstern, presented it as a purely predictive theory useful to the practitioners of economic science, many subsequent theorists, particularly those outside of economics, have come to endorse EU theory as providing us with a representation of reason. But precisely in what sense does EU theory portray reason? And does it do so successfully? There are two strikingly different (...) answers to these questions in the literature. On the one hand, there is the view of people such as David Gauthier that EU theory is an implementation of the idea that reason's only role is instrumental. On the other hand, there is the view suggested by Leonard Savage that the theory is a “formal” and noninstrumental characterization of our reasoning process. (shrink)