Looking for a psychology for the inner rational agent

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Abstract

Research in psychology and behavioural economics shows that individuals’ choices often depend on ‘irrelevant’ contextual factors. This presents problems for normative economics, which has traditionally used preference-satisfaction as its criterion. A common response is to claim that individuals have context-independent latent preferences which are ‘distorted’ by psychological factors, and that latent preferences should be respected. This response implicitly uses a model of human action in which each human being has an ‘inner rational agent’. I argue that this model is psychologically ungrounded. Although references to latent preferences appear in psychologically-based explanations of context-dependent choice, latent preferences serve no explanatory purpose.
Original languageEnglish
Pages (from-to)579-598
JournalSocial Theory and Practice
Volume41
Issue number4
DOIs
Publication statusPublished - Oct 2015

Keywords

  • inner rational agent
  • behavioural welfare economics
  • preference purification
  • attention
  • true self

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