The formalizing of self-interest as an economic principle was largely the work of Francis Edgeworth. It is sometimes wrongly traced back to the. It is worth considering how this approach compares with Amartya Sen’s arguments about “commitments” in “Rational Fools” (link). Sen’s essay. PDF | This article presents a critique of Amartya Sen’s article “Rational Fools”.
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Wednesday, March 21, Amartya Sen’s commitments.
The former corresponds to the case in which the concern for others directly affects one’s own welfare. If the knowledge of torture of others makes you sick, it is a case of sympathy; if it does not make you feel personally worse off, but you think it is wrong and you are ready to do something to stop it, it is a case of commitment.
The characteristic of commitment with which I am most concerned here is the fact that it drives a wedge between personal choice and personal welfare, and much of traditional economic theory relies on the identity of the two.
Understanding Society: Amartya Sen’s commitments
Sen thinks that John Harsanyi made an advance on ratinal narrow conception of rationality by introducing discussion of two separate preference orderings that are motivational for real decision-makers: But Sen rightly points out that this construction doesn’t give us a basis for choosing when the two orderings dictate incompatible choices. Sen attempts to formalize the idea of a commitment as a second-order preference ordering: Can one preference ordering do all these things?
A person thus described may be “rational” in the limited sense of revealing no inconsistencies in his choice behavior, but if he has no use for these distinctions between quite different concepts, he must be a bit of a fool. The purely economic man is indeed close to being a social moron.
Economic theory has been much preoccupied with this rational fool decked in the glory of his one all-purpose preference ordering.
Amartya Sen Rational Fools | Oxbridge Notes the United Kingdom
To make room for the different concepts related to his behavior we need a more elaborate structure. And Sen’s point is an important one: I may choose the vegetarian option, not because I prefer it, but because I prefer the world arrangement in which I go for the vegetarian option. Or in other words, one’s principles artional commitments may trump one’s first-order preferences.
This is significant because it focuses attention on a very basic fact: Other economists might object to this formulation on the basis of the fact that second-order preference rankings are more difficult to model; so we don’t get clean, simple mathematical seen of behavior if we introduce this complication. Sen acknowledges this point: Admitting behavior based on commitment would, of course have far- reaching consequences on the nature of many economic models.
I have tried to show why this change is necessary and why the consequences may well be serious.
The Creation of Rational Fools
Many issues remain unresolved, including the empirical importance of commitment as a vools of behavior, which would vary, as I have argued, from field to field. I have also indicated why the empirical evidence for this cannot be sought in the mere observation of actual choices, and must involve other sources of information, including introspection and discussion. There are substantial parts of ordinary human activity that don’t make sense if we think of rationality as egoistic maximization of utility.
Collective action, group mobilization, religious sacrifice, telling the truth, and working to the fullest extent of one’s capabilities are all examples of activity where narrow egoistic rationality would dictate different choices than those ordinary individuals are een to make.
And yet ordinary individuals are not irrational when they behave this way. Rather, they are reflective and deliberative, and they have reasons for their actions.
So the theory of rationality needs to have a way of representing this non-egoistic reasonableness. Foosl isn’t the only way that moral and normative commitments can be incorporated into a theory of rational deliberation; but it is one substantive attempt to do so, and is more satisfactory for me, anyway than the construction offered by Akerlof and Kranton.
I also like the neo-Kantian approach taken by Tom Nagel in The Possibility of Altruism as an effort amsrtya demonstrate that non-egoistic reasoning is rational. Posted by Daniel Little at Newer Post Older Post Home.