Rational Choice Theory Quotes

Sunk costs? We pay too much attention to them.

Why should anyone steal a watch when he could steal a bicycle?

Economists are economical, among other things, of ideas; most make those of their graduate days do for a lifetime.

The British system denied any role for human creativity, and instead argued, that if man merely followed his hedonistic desires, pursuing pleasure and avoiding pain, objective laws would naturally guide society to achieve the best allocation of wealth.

How could economics not be behavioral? If it isn't behavioral, what the hell is it?

Traditional economics is based on imaginary creatures sometimes referred to as 'Homo economicus.' I call them Econs for short. Econs are amazingly smart and are free of emotion, distraction or self-control problems. Think Mr. Spock from 'Star Trek.'

Economics is everywhere, and understanding economics can help you make better decisions and lead a happier life.

Early in my doctoral training at Cornell University, I became immersed in the behavioral decision theory paradigm.

I think Veblen had an interest in logic.

Neoclassical economics ... has uncovered important truths about the nature of money and markets because its fundamental model of rational self-interested human behavior is correct about 80% of the time.

Put simply, behavioural economics argues that human beings' decision-taking is guided by the evolutionary baggage which we bring with us to the present day. Evolution has made us rational to a point, but not perfectly so. It has given us emotions, for example, which programme us to override our rational brain and act more instinctively.

As an economist, I'm aware that life is full of trade offs.

About the only useful thing my economics degree taught me was that, in all decisions in life, you have to do a cost-benefit analysis.

Economics is counterintuitive. It just is.

Conventional economics is a form of brain damage.

Whereas economic man maximises, selects the best alternative from among all those available to him, his cousin, administrative man, satisfices, looks for a course of action that is satisfactory or 'good enough'.

The economist rarely examines the presuppositions of the models with which he works. The economist simply commences with individuals as evaluating, choosing, and acting units. This starting point for analysis necessarily draws attention to the choice or decision environment for the individuals who must make selections from among the alternatives.

It's always interesting for me that people vote against their interests.

When you teach your students that it's "economically rational" to commit crimes where the fines for misconduct are lower than the expected return on the crime, you instill a professional ethic that has no room for morals.

The tradition of Chicago price theory is a good one, and it is a low-tech methodology that tries to apply simple economic theory to the world.

Positivism eliminates any kind of natural law principle - for example, that there are economic laws which can be transgressed only at your peril. With positivism, there is a tendency to leap into ad hoc economic theory.

The individualism of current economic theory is manifest in the purely self-interested behaviour it generally assumes. It has no real place for fairness, malevolence, and benevolence, nor for the preservation of human life or any other moral concern.

There is much evidence that people are not rational, in the economist’s sense; nor do they take into account expectation, in the precise interpretation of that word. As a result, economic theory often does not correspond with what happens in the market. Some would argue that we need descriptive economics. I would argue that all should be taught about probability, utility, and MEU (maximization of expected utility) and act accordingly.

So many of the great thought leaders that have shaped economics - Gary Becker, Milton Friedman - what an unbelievable success story they've had in their field.

Capitalism does not require us to hold a particular set of cognitive beliefs; it only requires that we act as if certain beliefs (about money, commodities etc) are true. The rituals are the beliefs, beliefs which, at the level of subjective self-description, may well be disavowed.