Rationale Based Choice Theory

Yesterday in my philosophy class, my lecturer Mr. Roby Muhamad, Phd explained to us about this theory. So far, this is one of my best lesson in this philosophy class and I do kind of love this theory. Mas Roby also said that this theory in one of economist and political scientist best efforts to “divorce” with psychology. What a cute expression that thing, hehe.

Well you can say that one big issue about Psychology in that time and maybe also this time, is the justification about ‘is psychology a science? Natural science or social science? In what matter?”. Well because this is philosphy of science class, we learned about criteria to differentiate science and common sense. And up to this time (in this class, I mean), we still questioning about this matter. About criteria, about social science in his position to natural science and about psychology position in this long standing argument.

Back to this theory, economist try to find a ‘general law’ that happened to everyone so you can explain the behavior and predict what will happened in some situation. In this theory, they said that every human is rational in a way to fullfil his needs. In common expression, every human are selfish. Human (or in this theory they call it agent) have this utility need or you can say a satisfaction derive from everything in their environment (CMIIW, hihihi). Every agent could derive a certain amount of utility or satisfaction from any amount of any commodity.

Furthermore, subject to the limitations on available resources and information, each agent acquired the bundle of commodities that maximized the agent’s utility. Thus, rationality was defined as the maximization of available utility and all agents were assumed to rational. (up to this point, you still with me, right? ;p). In effect, utility theory is a way of ordering desires. It enables us to dispense with the ceteris paribus (all thing same in all situation) clauses. They also assumed that agents have full information about the world or in other say, they have true belief about all the facts that relevant to their circumstances. With this assumtion too, we can derive action from desire if we can hold relevant believe constant.

In an example, if a person knows what kind of foods are available in canteen and we know which one that person will gets the most utility from, then we can predictly sure which one she will choose. All down to the choice of agents. So, this paradigm is also called theory of choice. Quite interesting, eh?

Then what this theory implicated in our everyday lives? Yes, capitalism. In what way? I think I will explained in another post, hehhehe. Well, it’s quite hard to explain all this things in english actually. My english sucks, hahaha. So it think, another post about capitalism will come in bahasa Indonesia :p

Well in a short way, I think this theory is quite true somehow. Everything can down to simple things called choice (and later, price). But you can’t forget other things too beside this, like the person beliefs, background, desire, etc before they choosing something (I am a psychology student, afterall :p). there also many critics about this theory, like the rational things. When you assumed that everyone are rational (selfish), so where’s altruism position? If you said maybe the intention from altruis people is also selfish (like she do that because she selfishly wants God to love her back, ehhehe), then it cant be falsified. Even though one of the criteria about science is it can be falsified. Back to square one, hehe. But it is a great effort to explain about human behavior in a way that resembles explanation in natural science. If you want to know more about this, you can read it in Alexander Rosenberg’s books called “philosophy of social science” chapter 6.

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