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Rationality, external norms, and the epistemic value of menus

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  • Walter Bossert
  • Kotaro Suzumura

Abstract

Ever since Sen’s (1993; 1997) criticism on the notion of internal consistency or menu independence of choice, there exists a widespread perception that the standard revealed preference approach to the theory of rational choice has difficulties in coping with the existence of external norms, or the information a menu of choice might convey to a decision-maker, viz., the epistemic value of a menu. This paper provides a brief survey of possible responses to these criticisms of traditional rational choice theory. It is shown that a novel concept of norm-conditional rationalizability can neatly accommodate external norms within the standard framework of rationalizability theory. Furthermore, we illustrate that there are several ways of incorporating considerations regarding the epistemic value of opportunity sets into a generalized model of rational choice theory.
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  • Walter Bossert & Kotaro Suzumura, 2011. "Rationality, external norms, and the epistemic value of menus," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 37(4), pages 729-741, October.
    • Handle: RePEc:spr:sochwe:v:37:y:2011:i:4:p:729-741
    DOI: 10.1007/s00355-011-0568-8
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    Cited by:

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    2. Dan Qin, 2015. "On justifiable choice functions over opportunity sets," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 45(2), pages 269-285, September.
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    4. Shintaro Tamate, 2015. "External Norms and Systematically Observed Norms," The Japanese Economic Review, Japanese Economic Association, vol. 66(2), pages 247-259, June.

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    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations

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