Does optimization imply rationality?

Mongin, Philippe (2000): Does optimization imply rationality? Published in: Synthese No. 124 (2000): pp. 73-111.

Abstract

The 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.

• Item Type: MPRA Paper
• Language: English
• Keywords: Optimization, Rational Choice, Bounded Rationality, Transitivity, Revealed Preference, Infinite Regress
• Subjects: D - Microeconomics > D2 - Production and Organizations > D21 - Firm Behavior: Theory; D - Microeconomics > D1 - Household Behavior and Family Economics > D11 - Consumer Economics: Theory; B - History of Economic Thought, Methodology, and Heterodox Approaches > B4 - Economic Methodology > B41 - Economic Methodology

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