Preface

In this book, I undertake a reexamination of rationality, or rational behavior, in the history of economic thought, review strands of scholarly criticisms of rationality, and develop defenses for the continued use of rationality in economic analysis. The emphasis will be on how economists have employed the rationality premise in the post-World War II era, during which time the premise became widely recognized for being at the core of fully formed neoclassical economics and during which time the premise has come under ever more serious attacks that, in no small way, have undermined the credibility of economics as a scientific endeavor (at least according to many behavioral psychologists and behavioral economists whose work will be reviewed later in this book). Economists are a diverse group, which means my reexamination of rationality must be confined. I have chosen to adopt the perspective on rationality that is generally represented by mainstream or (what I equate with) neoclassical economics, widely adopted in modern intermediate microeconomic theory textbooks. I give special attention to two methodological perspectives on rationality that have emanated from the modern Chicago school identified by history of thought economist Steven Medema (2008): The first Chicago perspective is best represented in Milton Friedman’s classic methodological essay (1953) and his textbook (1962), with Friedman focusing on the motivational force of rationality, or just self-interest, within market settings. The other perspective is best represented by George Stigler’s and Gary Becker’s textbooks written separately (Stigler 1952, last published in 1987 with significant evolved changes in the treatment of rationality; and Becker 1971a) and their joint methodological essay (1977), with Stigler and Becker accepting much of Friedman’s methodology but untying the rational behavior premise from narrowly confined market analysis and using the premise as the founding motivational force undergirding a method of thinking, with the application of the method no longer contained by subject matter (for example, business or markets outcomes). In giving shape to mainstream, neoclassical economics for purposes of this volume, I remain fully aware that any school of thought has boundaries that are fuzzy and changing, with adherents within the loosely defined school of thought differing significantly on many details of analysis (which is especially true of