This paper will be concerned with hard choices—that is, choice situations where an agent cannot make a rationally justified choice. Specifically, this paper asks: if an agent cannot optimize in a given situation, are they facing a hard choice? A pair of claims are defended in light of this question. First, situations where an agent cannot optimize because of incompleteness of the binary preference or value relation constitute a hard choice. Second, situations where (...) agents cannot optimize because the binary preference or value relation violates acyclicity do not constitute a hard choice. (shrink)

This paper presents an argument against the widespread view that ‘hard choices’ are hard because of the incomparability of the alternatives. The argument has two parts. First, I argue that any plausible theory of practical reason must be ‘comparativist’ in form, that is, it must hold that a comparative relation between the alternatives with respect to what matters in the choice determines a justified choice in that situation. If comparativist views of practical reason are correct, however, (...) the incomparabilist view of hard choices should be rejected. Incomparabilism about hard choices leads us to an implausible error theory about the phenomenology of hard choices, threatens an unattractive view of human agency, and leaves us in perplexity about what we are doing when we choose in hard choices. The second part of the argument explores the main competitor to comparativist views of practical reason, noncomparativist view, according tow which a choice is justified so long as it is not worse than any of the alternatives. This view is often assumed by rational choice theorists but has its best philosophical defense in work by Joseph Raz. On Raz’s view, incomparabilism about hard choices avoids the problems faced if comparativism is correct, but it faces different difficulties. I argue that Raz’s noncomparativist view mistakenly assimilates practical reason to more restricted normative domains such as the law. (shrink)

How should you evaluate your choices when you’re unsure what their outcomes will be? One popular answer is to rank your options in terms of their expected utilities. But what should you do when you think that the value of their respective outcomes might be incommensurable? In the face of incommensurable values, it no longer makes sense to speak of ranking your options according to expected utility. Are there any general principles to guide us when facing decisions of this kind? (...) If only! This chapter develops an impossibility result: it holds that there are a handful of independently plausible constraints that no such decision theory can jointly satisfy. The result, while depressing, can be used to helpfully classify extant approaches based on which of the constraints they violate. (shrink)

What makes a choice hard? I discuss and criticize three common answers and then make a proposal of my own. Paradigmatic hard choices are not hard because of our ignorance, the incommensurability of values, or the incomparability of the alternatives. They are hard because the alternatives are on a par; they are comparable, but one is not better than the other, and yet nor are they equally good. So understood, hard choices open up a (...) new way of thinking about what it is to be a rational agent. (shrink)

This paper examines social choice theory with the strong Pareto principle. The notion of conditional decisiveness is introduced to clarify the underlying power structure behind strongly Paretian aggregation rules satisfying binary independence. We discuss the various degrees of social rationality: transitivity, semi-transitivity, the interval-order property, quasi-transitivity, and acyclicity.

The purpose of this paper is to investigate the relationship between collective rationality and permissible collective choice rules using a unified approach inspired by Bossert and Suzumura (J Econ Theory 138:311–320, 2008). We consider collective choice rules satisfying four axioms: unrestricted domain, strong Pareto, anonymity, and neutrality. A number of new classes of collective choice rules as well as the Pareto and Pareto extension rules are characterized under various concepts of collective rationality: acyclicity, transitivity, quasi-transitivity, semi-transitivity, (...) and the interval order property. Further, new concepts of collective rationality, K-term acyclicity and K-term consistency, are proposed and the corresponding characterizations are provided. (shrink)

This article provides a systematic analysis of social choice theory without the Pareto principle, by revisiting the method of Murakami Yasusuke. This article consists of two parts. The first part investigates the relationship between rationality of social preference and the axioms that make a collective choice rule either Paretian or anti-Paretian. In the second part, the results in the first part are applied to obtain impossibility results under various rationality requirements of social preference, such as S-consistency, quasi-transitivity, semi-transitivity, (...) the interval-order property, and acyclicity. (shrink)

I propose a novel view on hard choices. It broadens the concept to include not only ‘classic’ hard choices but also transformative and aspirational choices. I argue that a choice is hard when an individual does not have an all-things-considered reason to choose one option over another and the objects of choice are ultimate ends. Construing hard choices in this way supports and explains the widely held assumption that, when faced with hard choices, (...) it is impermissible to choose arbitrarily. More specifically, it shows that it is impermissible to choose arbitrarily by plumping, and yet legitimate to do so by picking. Understanding hard choices in the way I propose sheds light on the fact that there are moral and agential constraints that limit the space of permissible decision-making procedures when confronted with ‘classic’ hard, transformative, and aspirational choices. Delineating these constraints, in turn, can provide guidance to critically appraise current theories of practical rationality. (shrink)

According to a widely held view, rationality demands that the preferences of a person be transitive. The transitivity assumption is an axiom in standard theories of rational choice. It is also prima facie very plausible. I argue here that transitivity is not a necessary condition of rationality; it is a constraint only in some cases. The argument presented here is based on the non-linearity of differential utility functions. This paper has four parts. First, I present an argument against (...) the transitivity assumption (I, II). Second, I discuss some objections; this will also bring out some features of the view defended here, like the essentially comparative nature of choice (III). Then, I discuss certain proposals that promise to avoid my conclusion (IV). Finally, I go into some implications concerning the nature of rational decision making (V). To accept some intransitivities as rational does not make our life easier; it can even lead to hard choices. However, it does not lead to skepticism about rational choice. (shrink)

This paper analyzes the main features of rational choice theory and evaluates it with respect to the conceptions of Lakatos' research program and Laudan's research tradition. The analysis reveals that the thin rationality assumption, the axiomatic method and the reduction to the micro level are the only features shared by all rational choice models. On these grounds, it is argued that rational choice theory cannot be characterized as a research program. This is due to (...) the fact that the thin rationality assumption cannot be understood as a hard core in Lakatos' terms. It is argued that Laudan's conception of a research tradition better characterizes rational choice theory. On the basis of this conclusion, certain important criticisms of rational choice theory are answered. First, the criticisms concerning the core assumptions of rational choice theory are countered. It is argued that this critique is based on a misunderstanding of rational choice theory as a unified set of models, such as Lakatos' research program. Second, Green and Shapiro's rational choice 'pathologies' - inconsistent predictions, post hoc theory development and arbitrary domain restrictions - are evaluated. Contrary to Green and Shapiro, it is argued that post hoc theory development is a more preferable strategy for developing RCT than domain restrictions based on ex ante rules. (shrink)

This paper aims to contribute to the development of a “third-generation” rational choice theory by introducing a Multiple Player Approach for analysing collective action problems. Drawing on the foundational first and second generation works of Olson (The logic of collective action, Cambridge University Press, Cambridge, 1965) and Ostrom (Scand Polit Stud 23(1):3–16), we introduce five player types that we believe capture essential empirical features of many real world collective action problems: Blind Riders, Tough Riders, Hard Riders, Easy (...) Riders, and Low Riders. We consider the complex interaction and dynamics that unfold among them. The main novelty of the analysis is to draw attention to the need for active societal support to effectively empower and reward hard riders for resolving collective action problems, particularly when facing external shocks such as the Covid-19 pandemic, Brexit, and financial crises. (shrink)

This article discusses the possibility of a rationally justified choice between two options neither of which is better than the other while they are not equally good either (‘3NT’). Joseph Raz regards such options as incomparable and argues that reason cannot guide the choice between them. Ruth Chang, by contrast, tries to show that many cases of putative incomparability are instead cases of parity—a fourth value relation of comparability, in addition to the three standard value relations ‘better than’, (...) ‘worse than’ and ‘equally good as’. It follows, she argues, that many choice situations in which rationally justified choice seems precluded are in fact situations within the reach of practical reason. This article has three aims: (1) it challenges Chang’s argument for the possibility of parity; (2) it demonstrates that, even if parity would exist, its problematic implications for practical reason would not differ from those of Raz’s incomparability; (3) it discusses the underlying cause of hard cases of comparison: the fact that none of the three standard value relations applies (‘3NT’). It will be shown that the problematic implications for the rational justification of the choice are due to 3NT itself, irrespective of whether 3NT is explained as incomparability or parity. (shrink)

Transitive proxy voting (or "liquid democracy") is a novel form of collective decision making, often framed as an attractive hybrid of direct and representative democracy. Although the ideas behind liquid democracy have garnered widespread support, there have been relatively few attempts to model it formally. This paper makes three main contributions. First, it proposes a new social choice-theoretic model of liquid democracy, which is distinguished by taking a richer formal perspective on the process by which a voter chooses a (...) proxy. Second, it examines the model from an axiomatic perspective, proving (a) a proxy vote analogue of May's Theorem and (b) an impossibility result concerning monotonicity properties in a proxy vote setting. Third, it explores the topic of manipulation in transitive proxy votes. Two forms of manipulation specific to the proxy vote setting are defined, and it is shown that manipulation occurs in strictly more cases in proxy votes than in classical votes. (shrink)

Individuals make decisions under uncertainty every day based on incomplete information concerning the potential outcome of the choice or chance levels. The choices individuals make often deviate from the rational or mathematically objective solution. Accordingly, the dynamics of human decision-making are difficult to capture using conventional, linear mathematical models. Here, we present data from a two-choice task with variable risk between sure loss and risky loss to illustrate how a simple nonlinear dynamical system can be employed to (...) capture the dynamics of human decision-making under uncertainty (i.e., multi-stability, bifurcations). We test the feasibility of this model quantitatively and demonstrate how the model can account for up to 86% of the observed choice behavior. The implications of using dynamical models for explaining the nonlinear complexities of human decision-making are discussed, as well as the degree to which nonlinear dynamical systems theory might offer an alternative framework for understanding human decision-making processes. (shrink)

There is a very plausible principle of the transitivity of justifying reasons. It says that if "p" is better justified than "q" (all things considered) and "q" better than "r", then "p" is better justified than "r" (all things considered). There is a corresponding principle of rational theory choice. Call one theory "a better theory than" another theory if all criteria of theory choice considered (explanatory power, simplicity, empirical adequacy, etc.), the first theory meets the criteria better (...) than the second theory. The corresponding transitivity principle says that if theory A is a better theory than theory B and if theory B is a better theory than theory C, then A is a better theory than theory C. I argue against this principle. It turns out that whenever there are 2 or more relevant and independent criteria of theory evaluation, and whenever at least of one the criteria is "non-linear" in a certain sense, there may be violations of transitivity which do not violate any standards of rationality (of theory choice). This shows, again, that theory choice cannot be seen as merely the application of given rules of rational theory choice. (shrink)

This paper contributes to a theory of rational choice for decision-makers with incomplete preferences due to partial ignorance, whose beliefs are representable as sets of acceptable priors. We focus on the limiting case of `Complete Ignorance' which can be viewed as reduced form of the general case of partial ignorance. Rationality is conceptualized in terms of a `Principle of Preference-Basedness', according to which rational choice should be isomorphic to asserted preference. The main result characterizes axiomatically a (...) new choice-rule called `Simultaneous Expected Utility Maximization'. It can be interpreted as agreement in a bargaining game (Kalai-Smorodinsky solution) whose players correspond to the (extremal) `acceptable priors' among which the decision maker has suspended judgment. An essential but non-standard feature of Simultaneous Expected Utility choices is their dependence on the entire choice set. This is justified by the conception of optimality as compromise rather than as superiority in pairwise comparisons. (shrink)

This paper proposes and axiomatically characterizes a model of choice that builds on the criterion of partial dominance and allows for two types of avoidant behavior: choice deferral and status quo bias. These phenomena are explained in a unified way that allows for a clear theoretical distinction between them to be made. The model also explains the strengthening of the attraction effect that has been observed when deferral is permissible. Unlike other models of status quo biased behavior, the (...) one analyzed in this paper builds on a unique, reference-independent preference relation that is acyclic and generally incomplete. When this relation is complete, the model reduces to rational choice. (shrink)

This article traces a normative turn between the middle of the 1940s and the early 1950s reflected in the reformulation, interpretation, and use of rational choice theories at the Cowles Commission for Research in Economics. This turn is paralleled by a transition from Jacob Marschak’s to Tjalling Koopmans’s research program. While rational choice theories initially raised high hopes that they would serve as empirical accounts to inform testable hypotheses about economic regularities, they became increasingly modified and (...) interpreted as normative approaches offering behavioral recommendations for individual agents, organizations, government, and teams. The predefined elements constitutive of these accounts, inspired by simple rules of logic, were now meant to represent the basic demands of rationality and theories of rational decision making specified rules of conduct that were meant to shape rather than explain behavior. (shrink)

In Arrovian social choice theory assuming the independence of irrelevant alternatives, Murakami (1968) proved two theorems about complete and transitive collective choice rules that satisfy strict non-imposition (citizens’ sovereignty), one being a dichotomy theorem about Paretian or anti-Paretian rules and the other a dictator-or-inverse-dictator impossibility theorem without the Pareto principle. It has been claimed in the later literature that a theorem of Malawski and Zhou (1994) is a generalization of Murakami’s dichotomy theorem and that Wilson’s (1972) impossibility theorem (...) is stronger than Murakami’s impossibility theorem, both by virtue of replacing Murakami’s assumption of strict non-imposition with the assumptions of non-imposition and non-nullness. In this note, we first point out that these claims are incorrect: non-imposition and non-nullness are together equivalent to strict non-imposition for all transitive collective choice rules. We then generalize Murakami’s dichotomy and impossibility theorems to the setting of incomplete social preference. We prove that if one drops completeness from Murakami’s assumptions, his remaining assumptions imply (i) that a collective choice rule is either Paretian, anti-Paretian, or dis-Paretian (unanimous individual preference implies noncomparability) and (ii) that adding proposed constraints on noncomparability, such as the regularity axiom of Eliaz and Ok (2006), restores Murakami’s dictator-or-inverse-dictator result. (shrink)

Critics fault rational choice theory for dubious assumptions and limited explanatory power. The aims of rational choice are, however, as much normative as explanatory, and I argue that an abiding concern of political thought—the wrong of exploitation—gives moral weight to some of the more substantive assumptions underlying many rational choice prescriptions.

This article has both substantive and methodological goals. Methodologically, it shows that rational choice theory is an especially important tool for guiding research in contexts in which agents appear to be acting against their best interests. The Neolithic transition is one such case, and the article develops a substantive conception of that transition, illustrating the heuristic power of behavioral ecology.

In decision-making based on multiple criteria, situations may arise where agents find their options to be neither better than, worse than nor equal to each other with respect to the relevant criteria. How, if at all, can a justified choice be made between such options? Are the options incomparable? This article explores a hypothetical case that illustrates how such a situation can arise in an environmental context; more specifically, it considers the deliberations of an imagined ‘ethics committee’ as it (...) struggles to decide whether or not a deep-sea mining project should be allowed to proceed. I argue that the case is best understood as involving options that are comparable in the sense of being ‘on a par’. Working out from a discussion of Ruth Chang's ‘self-governance’ theory of choice in cases of parity, I suggest that, in the environmental context, the idea of choices expressing a moral identity may lead us in the direction of a plausible solution to these particularly challenging cases. (shrink)

This paper will be concerned with hard choices—that is, choice situations where an agent cannot make a rationally justified choice. Specifically, this paper asks: if an agent cannot optimize in a given situation, are they facing a hard choice? A pair of claims are defended in light of this question. First, situations where an agent cannot optimize because of incompleteness of the binary preference or value relation constitute a hard choice. Second, situations where (...) agents cannot optimize because the binary preference or value relation violates acyclicity do not constitute a hard choice. (shrink)

The rational choice approach focuses on explaining macrosocial phenomena or relationships by applying a theory about the behavior of individual actors. This paper addresses James S. Coleman’s account of micro-macro transitions involved in rational choice explanations. The starting point of this account is a macro-relationship. Its independent variable has a causal effect on the independent variable of a micro-relationship. The dependent variable of this relationship in turn influences the dependent variable of the macro-relationship (see Figure 1 (...) of this paper). The paper extends this account by delineating other types of micro-macro explanations and discusses some of its problems. (shrink)

According to one prominent view of rationality, for the choice of alternative to be justified, it must be at least as good as other alternatives. Michael Jensen has recently invoked this view to argue that managers should act exclusively to maximize the long-run market value of economic enterprises. According to Jensen, alternative accounts of managerial responsibility, such as stakeholder theory, are to be rejected because they lack a single measure to compare alternatives as better or worse. Against Jensen’s account, (...) this paper argues that choosing the alternative that is at least as good as other alternatives need not preclude managers from respecting considerations in addition to long-run market value. The paper argues that such considerations may be incorporated into managerial decision-making by introducing constraints and priorities into the process of maximizing long-run market value and by allowing for “clumpy” values. (shrink)

The “ultimate objective” of this book, says David Schmidtz, “is to examine the degree to which being moral is co-extensive with being rational”. For Schmidtz, an “end” gives us a reason for action provided that its pursuit is not undercut by some other end. Morality has a two-part structure. A person’s goal is “moral” if “pursuing it helps [her] to develop in a reflectively rational way,” provided its pursuit does not violate “interpersonal moral constraints”. Interpersonal constraints are imposed (...) by “collectively rational” social institutions, institutions that “make people in general better off by nonexploitative means”. Schmidtz’s view is a form of “actualism.” Our reasons are given by our actual goals, subject to the qualification mentioned above, and moral constraints are given by actually existing collectively rational institutions. Schmidtz concedes that this framework cannot guarantee that it is rational for every agent to be moral, and he concedes that his moral theory might be incomplete. Nevertheless, he argues, “morality and rationality make room for each other in a variety of ways”. (shrink)

A notorious problem that has recently received increased attention in axiology, normative theory and population ethics is the apparent ubiquity of what can be generally called nondeterminacy. This paper illustrates how nondeterminacy can spawn cyclical rankings. So, accepting that practical reasons can admit of nondeterminacy challenges the widely held idea that ‘better than’ is transitive. As a result, standard approaches to rational choice under nondeterminacy fail to be action-guiding, since in some situations all options are dominated, that is, (...) impermissible according to standard rational choice criteria. (shrink)

James Coleman attempted to reconcile rational choice theory with the classical sociological concerns: the relationship between the individual and society, and the historical and normative status of rationality. He identifies limits to the rational choice model, and suggests some promising but ultimately unconvincing ways around them. His project does, however, offer an important critique of Weber's theory of bureaucracy, which is of value in analyzing relationships between corporate actors and particular persons.

The descriptive viewpoint in rational choice has generated an important Standard Rational Choice Theory revision. This viewpoint has meant the introduction of relevant psychological considerations that Rational Choice Theory tied to the neoclassical economics is unable to heed In this paper I suggest a way to expand the descriptive viewpoint by theorizing how some factors, coming from the social and cultural environment, operate within rational choice. That troublesome issue concerning the overall validity (...) of economic laws is also a question here; specifically, if these descriptive proposals expand the explanation of the disturbing causes of economic laws, or if they actually call into question their fundamental principles, encouraging consideration of some economic issues in a quite new, different manner. (shrink)

The critics of rational choice theory (RCT) frequently build on the contrast between so-called thick and thin applications of RCT to argue that thin RCT lacks the potential to explain the choices of real-world agents. In this paper, I draw on often-cited RCT applications in several decision sciences to demonstrate that despite this prominent critique there are at least two different senses in which thin RCT can explain real-world agents’ choices. I then defend this thesis against the most (...) influential objections put forward by the critics of RCT. In doing so, I explicate the implications of my thesis for the ongoing philosophical debate concerning the explanatory potential of RCT and the comparative merits of widely endorsed accounts of explanation. (shrink)

In a recent article, Okasha challenges Kuhn’s claim that there is no ‘neutral’ algorithm for theory choice. He argues using Arrow’s ‘impossibility’ theorem that — except under certain favourable conditions concerning the measurability and comparability of theoretical values — there are no theory choice algorithms at all, neutral or otherwise. But Okasha’s argument does not apply to important theory choice problems, among them the case of Copernican and Ptolemaic astronomy that much occupied Kuhn. The reason is that (...) Kuhn’s choice criteria can rank rival theories in only a few ways, which makes the analogue of Arrow’s domain assumption inappropriate. It is hard to see any consequences for Kuhn’s claim, or threat to the rationality of science. (shrink)

What, normatively speaking, are the grounds of rational choice? This paper defends ‘comparativism’, the view that a comparative fact grounds rational choice. It examines three of the most serious challenges to comparativism: 1) that sometimes what grounds rational choice is an exclusionary-type relation among alternatives; 2) that an absolute fact such as that it’s your duty or conforms to the Categorial Imperative grounds rational choice; and 3) that rational choice between (...) incomparables is possible, and in particular, all that is needed for the possibility of rational choice is that one alternative is not worse than the others. Each challenge is questioned. If comparativism is correct, then no matter what normative theory you favor, your answer to the question, ‘What makes my choice rational?’ must be comparative in form. In this way, comparativism provides a framework for normative theorizing. (shrink)

Describes and evaluates a number of existing criticisms of the formal theory of rationality and subjective expected utility theory. The author argues that rationality is not a behavioural entity, but rather has to do with the relation between an agent's preferences and his or her behaviour.

Although rational choice theory has enjoyed only modest predictive success, it provides a powerful explanatory mechanism for social processes involving strategic interaction among individuals and it stimulates interesting empirical inquiries. Rather than present competing theories to compare against rational choice, Don Green and Ian Shapiro have merely alluded to alternative explanatory variables such as culture, institutions, and social norms, without showing either how these factors can be incorporated into a more powerful theory, or how they are (...) inconsistent with rational choice theory. It is likely that any eventual theory of the origin and maintenance of social institutions, norms, and values will have to reserve a central place for rational action. (shrink)

Gödel’s first incompleteness result from 1931 states that there are true assertions about the natural numbers which do not follow from the Peano axioms. Since 1931 many researchers have been looking for natural examples of such assertions and breakthroughs were obtained in the seventies by Jeff Paris [Some independence results for Peano arithmetic. J. Symbolic Logic 43 725–731] , Handbook of Mathematical Logic, North-Holland, Amsterdam, 1977] and Laurie Kirby [L. Kirby, Jeff Paris, Accessible independence results for Peano Arithmetic, Bull. of (...) the LMS 14 285–293]) and Harvey Friedman [S.G. Simpson, Non-provability of certain combinatorial properties of finite trees, in: Harvey Friedman’s Research on the Foundations of Mathematics, North-Holland, Amsterdam, 1985, pp. 87–117; R. Smith, The consistency strength of some finite forms of the Higman and Kruskal theorems, in: Harvey Friedman’s Research on the Foundations of Mathematics, North-Holland, Amsterdam, 1985, pp. 119–136] who produced the first mathematically interesting independence results in Ramsey theory and well-order and well-quasi-order theory .In this article we investigate Friedman-style principles of combinatorial well-foundedness for the ordinals below ε0. These principles state that there is a uniform bound on the length of decreasing sequences of ordinals which satisfy an elementary recursive growth rate condition with respect to their Gödel numbers.For these independence principles we classify their phase transitions, i.e. we classify exactly the bounding conditions which lead from provability to unprovability in the induced combinatorial well-foundedness principles.As Gödel numbering for ordinals we choose the one which is induced naturally from Gödel’s coding of finite sequences from his classical 1931 paper on his incompleteness results.This choice makes the investigation highly non-trivial but rewarding and we succeed in our objectives by using an intricate and surprising interplay between analytic combinatorics and the theory of descent recursive functions. For obtaining the required bounds on count functions for ordinals we use a classical 1961 Tauberian theorem of Parameswaran which apparently is far remote from Gödel’s theorem. (shrink)

A fundamental philosophical question that arises in connection with evolutionary theory is whether the fittest patterns of behavior are always the most rational. Are fitness and rationality fully compatible? When behavioral rationality is characterized formally as in classical decision theory, the question becomes mathematically meaningful and can be explored systematically by investigating whether the optimally fit behavior predicted by evolutionary process models is decision-theoretically coherent. Upon investigation, it appears that in nontrivial evolutionary models the expected behavior is not always (...) in accord with the norms of the standard theory of decision as ordinarily applied. Many classically irrational acts, e.g. betting on the occurrence of one event in the knowledge that the probabilities favor another, can under certain circumstances constitute adaptive behavior.One interesting interpretation of this clash is that the criterion of rationality offered by classical decision theory is simply incorrect (or at least incomplete) as it stands, and that evolutionary theory should be called upon to provide a more generally applicable theory of rationality. Such a program, should it prove feasible, would amount to the logical reduction of the theory of rational choice to evolutionary theory. (shrink)

If one rejects choice theory, one still faces the challenge of explaining what one should do in a self-torture case if one is fully rational, and why. In addition, one faces the more fundamental challenge of explaining what rationality is, if it is not choice theory. Responding to these challenges in a systematic way is one of several key contributions of Andreou’s insightful book Choosing Well, and is my focus here as well. My goal is to highlight (...) questions that arise for Andreou’s view, especially from the perspective of those who are sympathetic to choice theory. (shrink)

We address the oft-repeated criticism that the demands which the rational choice approach makes on the knowledge and cognition of a decision-maker are way beyond the capabilities of typical human intelligence. Our key finding is that it may be possible to arrive at this ideal of rationality by means of cognitively less demanding, heuristic-based ecological reasoning that draws on information about others’ choices in the DM’s environment. Formally, we propose a choice procedure under which, in any (...) class='Hi'>choice problem, the DM, first, uses this information to shortlist a set of alternatives. The DM does this shortlisting by a mental process of categorization, whereby she draws similarities with certain societal members—the ingroup—and distinctions from others—the outgroup—and considers those alternatives that are similar to ingroup members’ choices. Then, she chooses from this shortlisted set by applying her preferences, which may be incomplete owing to limitations of knowledge. We show that, if a certain homophily condition connecting the DM’s preferences with her ingroup–outgroup categorization holds, then the procedure never leads the DM to making bad choices. If, in addition, a certain shortlisting consistency condition holds vis-a-vis non-comparable alternatives under the DM’s preferences, then the procedure results in rational choices. (shrink)

Although the theory of greatest-element rationalizability and maximalelement rationalizability on general domains and without full transitivity of rationalizing relations is well-developed in the literature, these standard notions of rational choice are often considered to be too demanding. An alternative definition of rationality of choice is that of non-deteriorating choice, which requires that the chosen alternatives must be judged at least as good as a reference alternative. In game theory, this definition is well-known under the name of (...) individual rationality when the reference alternative is construed to be the status quo. This alternative form of rationality of individual and social choice is characterized in this paper on general domains and without full transitivity of rationalizing relations. (shrink)

The first goal of this study was to validate the Rational-Experiential Inventory (REI) and the Cognitive Reflection Test (CRT) through checking their relation to the transitivity axiom. The second goal was to test the relation between decision strategies and cognitive style as well as the relation between decision strategies and the transitivity of preferences. The following characteristics of strategies were investigated: requirements for trade-offs, maximization vs. satisficing and option-wise vs. attribute-wise information processing. Respondents were given choices between two multi-attribute (...) options. The options were designed so that the choice indicated which strategy was applied. Both the REI-R and the CRT were found to be good predictors of the transitivity of preferences. Respondents who applied compensatory strategies and the maximization criterion scored highly on the REI-R and in the CRT, whereas those who applied the satisficing rule scored highly on the REI-R but not in the CRT. Attribute-wise information processing was related to low scores in both measurements. Option-wise information processing led to a high transitivity of preferences. (shrink)

Decision-makers frequently struggle to base their choices on an exhaustive evaluation of all options at stake. This is particularly so when the choice problem at hand is complex, because the available alternatives are hard to compare. Rather than striving to choose the most valuable alternative, in such situations decision-makers often settle for the choice of an alternative which is not inferior to any other available alternative instead. In this paper, we extend two established models of boundedly (...) class='Hi'>rational choice, the categorize then choose heuristic and the rational shortlist method, to incorporate this kind of “indecisive” choice behavior. We study some properties of these extensions and provide full behavioral characterizations. (shrink)

The much-discussed ‘Argument from Small Improvement’ has been advanced both as a reason to reject (tripartite) Completeness, one of the standard axioms of decision theory, and to accept the possibility of rationally incomparable choices. But this form of argument cannot be an effective basis for either of these conclusions, unless one already has some prior, independent reason to prefer Transitivity to Completeness as a constraint on rational preferences (or rational values). In particular, I show how a reverse argument (...) from small improvement can be constructed, starting from the assumption of tripartite Completeness, to the conclusion that Transitivity fails. I conclude that this form of argument as it has been standardly presented in the literature is a kind of ‘red herring’. We can only make progress here by evaluating the reasons independent of either such argument to prefer one or other of Transitivity or Completeness. (shrink)

Standard decision theory, or rational choice theory, is often interpreted to be a theory of instrumental rationality. This dissertation argues, however, that the core requirements of orthodox decision theory cannot be defended as general requirements of instrumental rationality. Instead, I argue that these requirements can only be instrumentally justified to agents who have a desire to have choice dispositions that are stable over time and across different choice contexts. Past attempts at making instrumentalist arguments for the (...) core requirements of decision theory fail due to a pervasive assumption in decision theory, namely the assumption that the agent’s preferences over the objects of choice – be it outcomes or uncertain prospects – form the standard of instrumental rationality against which the agent’s actions are evaluated. I argue that we should instead take more basic desires to be the standard of instrumental rationality. But unless agents have a desire to have stable choice dispositions, according to this standard, instrumental rationality turns out to be more permissive than orthodox decision theory. (shrink)