4
$\begingroup$

I am looking for the first economists arguing that maximizing utility function is the iff condition of rational behavior.

I've learned that neoclassical economics is founded on this argument. Is this still the mainstream - Do people still believe that rationality is utility maximization and utility maximization is rational?

Linked question: Who is the first one to equate "rational" with "complete and transitive preference"?

Improve this question
$\endgroup$
4
  • 2
    $\begingroup$ Although behavioral economics gained some prominence in recent years since we do not have any general theory of irrationality - rationality and utility maximizing behavior is still mainstream. I would even dare to say that majority of research still relies on rational choice theory (RCT). However, note that a person can be irrational (due to hyperbolic discounting (i.e. having dynamically inconsistent preferences) and still maximize utility conditional on that or there are also evolutionary models that are not strictly speaking based on RCT $\endgroup$
    – 1muflon1 ♦
    Commented Nov 18, 2020 at 1:29
  • $\begingroup$ @1muflon1 Is time-inconsistency necessarily considered irrational? (Reference...? Perhaps I am missing the definition.) An agent with time-inconsistent preferences who maximizes his expected utility by anticipating his own time-inconsistency (therefore in a SPNE with all his future selves) seems pretty rational. $\endgroup$
    – Michael
    Commented Nov 19, 2020 at 8:20
  • $\begingroup$ @Michael as far as I understand some time inconsistent preferences would violate transitivity so the choice would not be considered rational, I will try to find some sources to back it up $\endgroup$
    – 1muflon1 ♦
    Commented Nov 19, 2020 at 10:01
  • $\begingroup$ @1muflon1 Well, by "behavioral economics" I guess you are talking about intransitive preference like regret theory? In this case, people still maximize a menu-dependent utility. In evolutionary theories, agents are often assumed to maximize a long-term utility, in my limited understandings. $\endgroup$
    – High GPA
    Commented Nov 20, 2020 at 9:15

0

Reset to default

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service and acknowledge you have read our privacy policy.