Rational choice theory

Addiction can be thought of as a specific change in some neural pathways. This approach, important as it is, is silent about whether the addictive behavior can be explained as rational behavior or not. Likewise, the explanatory approaches of rational choice theory are silent about whether our wills are unfree when we are addicted but desperately want to quit. Freedom of the will is not a concept placed within rational choice theory that theory explains free action, actions wherein we do what we want. This leaves room for a different sort of theorist, that is, a philosopher. 

Addicts are not people without willpower or people driven to act with out making choices. The clinical picture is of people who too often make choices that, in the long term, reduce their long-term utility and their total well being and, in addition, often burden both their families and society. These choices are suboptimal to long-term utility and, therefore, in the meaning of rational choice theory, irrational. The core problem is one of impeded rationality, of insufficient choice capacity to integrate present and future consideration in a sufficiently consistent pattern. 

In standard rational choice theory, actors are assumed to have consistent preferences and to act according to their own better judgment. In particular, rational actors are assumed to be dynamically consistent planners If actors prefer an early, small reward A to a later, bigger reward at a certain point in time, they will do so at all times. Hence, rational actors do not suffer from weakness of the will, and they never give in to temptations that they later regret. Addictions are often mentioned as an example of behavior that violates rationality Many addicts seem to act contrary to their own better judgment, as they claim that they would like to stop their self-destructive consumption behavior, but still they continue consuming the substance they are addicted to. 

The main difference between Becker and Murphy s standard rational choice theory and Ainslie s picoeconomic theory is dynamic consistency versus inconsistency. The congenital inconsistency that forms the starting in Ainslie s theory allows Ainsliean addicts to struggle to get out of their addiction, and relapse may be explained within the Ainsliean framework by erosion of personal rules and willpower. Hence, an addiction theory based on Ainslie s theory of motivation can handle the phenomena that are left unexplained by Becker and Murphy s theory of addiction. 

However, even a less radical theory of discounting than the hyperbolic theory can solve the difficulties of Becker and Murphy s addiction theory. It is sufficient to assume that people s rate of discounting typically fluctuate unsystematically over time and that people are therefore not always equally farsighted. The theory of fluctuating discount functions postulate that people discount the future recursively and that they base their judgments on realistic expectations about their own future mental states. Hence, this theory can be seen as a straightforward extension of classical rational choice theory. Still, these consu-... 

Hence, the picoeconomic theory of addiction and the modified version of the rational choice theory of addiction obtained by allowing for fluctuations in discount functions do in fact have a fairly large common core. 

Throughout, we have not addressed the issue of whether self-control problems can lead to behaviors that cannot be explained with time-consistent preferences. In fact, such smoking guns—qualitatiw predictions that are inconsistent with rational choice theory—are difficult to come by in our highly stylized and simplified models. In these models, only a few types of behavior can arise, and most of these behaviors could arise from time-consistent preferences.27 One might ask, then, why it is worthwhile to study a self-control model of addiction. We feel there are a number of reasons. 

Scholars disagree on the relative importance of preferences and opportunities in explaining behavior. Some economists argue that all people have essentially the same preferences and desires only opportunities differ. Although usually staunch defenders of rational-choice theory, they are led, paradoxically, to argue that choice almost doesn t matter because any variations in behavior must be explained by variations in opportunities. Most social scientists, however, believe that people differ in their desires as well as in their opportunities, and this view seems to me so obviously right as not to require further defense. 

Rational-CHOICE theory aims at explaining human behavior. To achieve this, it must, in any given case, proceed in two steps. The first step is to determine what a rational person would do in the circumstances. The second step is to ascertain whether this is what the person actually did. If the person did what the theory predicted he would do, it can add the case to its credit side. Similarly, the theory can fail at each of the two steps. First, it can fail to yield determinate predictions. Second, people can fail to conform to its predictions -they can behave irrationally. 

First, I shall explain how rational-choice theory can fail through indeterminacy. In general, there are two forms of indeterminacy. There may be several actions that are equally and optimally good. Or there may be no action that is at least as good as all others. 

This poses a puzzle for rational-choice theory. Suppose 1 prefer sute x. in which your desires are frustrated, to state y, in which they are satisfied. If offered an occasion to frustrate your desires, I should take it, even at some cost to myself. If 1 don t, am I irrational Or am I coping rationally with an irrational desire, by refusing to act on it ... 

An important sub-variety of rational action is strategic behaviour, that is choices that take account of the conjectured or anticipated choices of other agents. The incorporation of the strategic aspect into rational-choice theory allows one to formulate three sets of interdependencies that pervade social life, (i) The reward of each depends on the rewards of all, by envy, altruism or solidarity. (ii) The reward of each depends on the choices of all, by general social causality. (Hi) The choice of each depends on the choices of all, by strategic reasoning. The third objection above can Chen be restated as follows rational-choice theory is not able to take into account that (tv) the preferences of each depend on the actions of all. ... 

Many of the discussions in chapter 1 apply immediately to Marx s economic theory, such as the analysis of rational-choice theory (t. 2. t) and the comments on the methodology of unintended consequences (1.3.2). Some additional problems also arise, however, that are more specifically related to his economic writings. In 3.1.1 1 first consider the appropriateness of talking about Marx s economic "models", in the modern sense of that term. Under this heading I also discuss Marx s use of "tendency laws" to explain economic relations. In 3.1.2 I comment on Marx s attempt to apply the Hegelian distinction between essence and appearance to economic life, notably to the relation between values and prices. I argue that while this particular application fails, others hold out more promise. This discussion is closely related to the analysis of fetishism (2.3.2) and of ideology (notably 8.2.3). 

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