Rational Choice Theory (and Rational Choice Marxism)

Abstract

Rational choice theory (RCT) is the name given to an approach that seeks to explain human affairs by making certain simplifying assumptions about what motivates individual action. The assumption is that individuals have preferences toward things in the world (preferring apples to oranges or being altruistic to being selfish) and that they act in a consistent way, that is, they act as though they are trying to get the most of the things they prefer. Acting consistently in this way is known as being rational. Acting in ways inconsistent with preferences means acting less than rationally, or indeed if inconsistent enough, irrationally. These assumptions have been applied to behavior in market situations and also increasingly to socially interdependent decision making (through game theory). Based on a number of simple assumptions rational choice attempts to explain human behavior in terms of peoples’ tastes (preferences), beliefs (expectations of the success of different actions), and constraints upon their choice, including the choices made by other people. Rational choice (or analytical) Marxism uses these simplifying assumptions about individual human behavior to test and explain some of the key arguments of Marxist theory – including exploitation, class relations, and historical change. Rational choice Marxism argues that ‘some’ of the key features of Marxist analysis can be supported by logical reasoning or explained from the point of view of individual rational behavior (subject to constraints) rather than relying on structural analysis or dialectics.