Does optimization imply rationality?
AbstractThe relations between rationality and optimization have been widely discussed in the wake of Herbert Simon's work, with the common conclusion that the rationality concept does not imply the optimization principle. The paper is partly concerned with adding evidence for this view, but its main, more challenging objective is to question the converse implication from optimization to rationality, which is accepted even by bounded rationality theorists. We discuss three topics in succession: (1) rationally defensible cyclical choices, (2) therevealed preference theory of optimization, and (3) the infinite regress of optimization. We conclude that (1) and (2) provide evidence only for the weak thesis that rationality does not imply optimization. But (3) is seen to deliver a significant argument for the strong thesis that optimization does not imply rationality.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 37740.
Date of creation: 1998
Date of revision:
Optimization; Rational Choice; Bounded Rationality; Transitivity; Revealed Preference; Infinite Regress;
Other versions of this item:
- P. Mongin, 1998. "Does optimization imply rationality ?," THEMA Working Papers 98-17, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
- Mongin, P., 1998. "Does Optimization Imply Rationality?," Papers 9817, Paris X - Nanterre, U.F.R. de Sc. Ec. Gest. Maths Infor..
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
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