Rational choice theory

Rational choice theory

1. AIMS

   • Bring in rigour and predictive power of econ into pol
   • Produce deductive science in pol based on series of simplifying assumptions
   • Mathematically model implications of human rationality for pol

2. ASSUMPTIONS

   • Humans are rational, efficient & utility maximisers who seek to max own personal utility. No consideration of others
   • Individual actors are basic units of analysis
   • All have clear hierarchy of preferences. In any given context, only 1 optimal course of action

3. THEMES

   • Aggregation of individually rational behaviour = Collective irrational outcomes
   • Pursuit of self-interest ensures that officials cannot be trusted to deliver collective welfare
   • Social welfare is compromised by free-riding and collective action problem. Without other incentives, free-riding likely to prevent collective action even when actors share common collective interest
     • Free-riding = Individual benefits from the collective action of others. The rationality of the individual tells them that their individual behaviour will not influence sig. the overall outcome so can reap benefits regardless of own participation.
     • Collective action problem = Conflict between individual's interest and group's interest

4. LIMITATIONS

   • Ignores institutional contexts where rationality is exercised
   • Doesn't clarify on formation of preferences
   • Relies upon theoretical assumptions
   • Confines itself to post hoc (occuring/after event) rationalisation
   • Limited view of humans
   • Cannot explain altruism nor collective rational behaviour
   • Deals poorly with processes of change