The Weak Rationality Principle in Economics
Series
CESifo Working Papers
Type
discussion paper
Date Issued
2005-02-01
Author(s)
Abstract
The weak rationality principle is not an empirical statement but a heuristic rule of how to proceed in social sciences. It is a necessary ingredient of any ‘understanding' social science in the Weberian sense. In this paper, first this principle and its role in economic theorizing is discussed. It is also explained why it makes sense to use a micro-foundation and, therefore, employ the rationality assumption in economic models. Then, with reference to the ‘bounded rationality' approach, the informational assumptions are discussed. Third, we address the assumption of self-interest which is often seen as a part of the rationality assumption. We conclude with some remarks on handling the problems of ‘free will' as well as ‘weakness of the will' within the economic approach.
Language
English
Keywords
rationality
self interest
micro-foundation
bounded rationality
HSG Classification
contribution to scientific community
Refereed
No
Number
1410
Start page
25
Subject(s)
Eprints ID
31423
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CESifowp1410.pdf
Size
230.1 KB
Format
Adobe PDF
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