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The rationality principle as a universal grammar of economic explanations

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  • Cheng LI

    (Institute of Economics, Chinese Academy of Social Sciences, Beijing (China))

Abstract

A universal grammar of economic explanations is characterized by the means-end rationality principle, which can be understood by drawing a conceptual distinction between its two facets: theoretical abstraction and empirical content. The former serves as a pure form of economic way of thinking and thus delimits the capacities of economists to perceive and understand the manifold human behaviour. The latter provides economists with objects of thought and renders the discipline empirically relevant. Given the implications of the two facets of rationality, the main task of economics as a descriptive science is to incorporate appropriate empirical content into the pure rational framework with the aim of better explaining and predicting human behaviour. As a prescriptive science, economic inquiry should draw on the persuasion and communication skills of its practitioners, thereby influencing the state of the economy through changing the means and ends of the decision makers in question.

Suggested Citation

  • Cheng LI, 2020. "The rationality principle as a universal grammar of economic explanations," The Journal of Philosophical Economics, Bucharest Academy of Economic Studies, The Journal of Philosophical Economics, vol. 13(2), pages 58-80, November.
    • Handle: RePEc:bus:jphile:v:13:y:2020:i:2:n:2
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    References listed on IDEAS

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    More about this item

    Keywords

    rationality; constrained maximization framework; epistemology;
    All these keywords.

    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology

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