Rational Choice Theory at the Origin? Forms and Social Factors of “Irrational Choice”

Abstract

The paper addresses the ‘rational choice only’ reconstruction, characterization, and interpretation of classical and neoclassical economics. It argues that such a reconstruction is inaccurate failing to do justice to the dual theoretical character of classical/neoclassical economics. The paper instead proposes and shows that the latter involves not only elements of ‘rational choice theory’ but also those of an alternative conception. It identifies various and important ideas, observations, and implications of irrational choice and action within classical/neoclassical economics. One class of such ingredients involves forms, expressions, and cases—i.e. specification and classification—of irrational choices in the economy. Another class comprises the social and other factors—i.e. economic sociology or social economics—of irrational choices in the economy. The paper’s intended contribution is to help identify and clarify the extant sources and alternatives of rational choice theory in conventional economics. Generally, it aims to contribute to identifying and better understanding sociological implications in economics.