Itzhak Gilboa argues that economic theory has provided a set of powerful models and introduction to some of thefundamental insights of rational choice theory. Itzhak Gilboa’s book aims at introducing rational choice theory to a readership without prior knowledge of the field. It presents the fundamental. Rational Choice has 29 ratings and 1 review. This text offers a rigorous, concise, and nontechnical introduction to some of the fundamental insights of r.
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A nontechnical, concise, and rigorous raational to the rational choice paradigm, focusing on basic insights applicable in fields ranging from economics to philosophy.
This book offers a rigorous, concise, and nontechnical introduction to some of the fundamental insights of rational choice theory. It draws on formal theories of microeconomics, decision making, games, and social choice, and on ideas developed in philosophy, psychology, and sociology.
Itzhak Gilboa argues that economic theory has provided a set of powerful models and broad insights that have changed the way we think about everyday life. Gilboa explains the main concepts in language accessible to the nonspecialist, offering a nonmathematical guide to some of the main ideas developed in economic theory in the second half of the twentieth century.
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Chapters cover feasibility and desirability, utility maximization, constrained optimization, expected utility, probability and statistics, aggregation of preferences, games and equilibria, free markets, and rationality and emotions. Online gibloa offer additional material, including a survey of relevant mathematical concepts.
Gilboa’s Rational Choice is a clear, comprehensive, and clever introduction to economic theory. The focus is on the concepts, not the mathematics. It introduces the reader to the tenets of the field, while incorporating insights from philosophy, psychology, and sociology.
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Customers who bought this item also bought. Page 1 of 1 Start over Page 1 of 1. Decision Theory in Practice. Game Theory for Applied Economists. A Very Short Introduction. Review Gilboa’s Rational Choice is a clear, comprehensive, and clever introduction to economic theory. Try the Kindle edition and experience these great reading features: Share your thoughts with other customers. Write a customer review. Showing of 7 reviews. Top Reviews Most recent Top Reviews.
There was a problem filtering reviews right now. Please try again later. Professor Gilboa says in the Introduction, “The purpose of this book is to introduce readers to some of the fundamental insights of rational choice theory, drawing upon the formal theories of microeconomics, decision, games, and social choice as well as upon ideas developed in philosophy, psychology, and sociology.
I believe that economic theory and its fellow rationql have provided a remarkable collection of powerful models and general insights, which change the way we think about everyday life. At the same time, economics has been justifiably criticized on several grounds. First economics is a mathematically oriented field that in many situations fails to provide accurate numerical predictions as do the exact sciences. Second, the basic assumptions of economics have come under attack and have been shown to falsifiable in experimental studies.
Finally, economics is often criticized for failing to deal with important and deep issues such as happiness and well-being, justice and fairness. Moreover, the scientific or pseudo-scientific approach to economics has been argued to be serving the rhetoric of capitalism in a way that may itzhqk detrimental to well-being and to justice.
Rational Choice by Itzhak Gilboa
The focus of this book is on some basic insights that survive these critiques. Feasibility and Desirability, 2. Probability and Statistics III. Aggregation of Preferences, 7. Games and Equilibria, 8. Evolutionary View of Emotions, Utility and Well-Being I came to this book after having read many books in the inter-related areas of logic, economics, game theory, decision making, consciousness, etc.
Predictably Irrational, Revised and Expanded Edition: Finding Modern Truth in Ancient Wisdom. I really enjoyed this book for several reasons, but primarily because of Professor Gilboa’s definition of “rationality. According to this definition, a mode of behavior is rational for a given person if this person feels comfortable with it, and is not embarrassed by it, even when it is analyzed for him The reason I like this peculiar definition of rationality is that I find it useful.
An irrational mode of behavior is one that I can hope to change by talking to the decision maker, by explaining the theory to him, and so forth. A rational mode of behavior is one that is likely to remain in the data despite my teaching and preaching. I prefer to think of rationality as a notion of stability, or coherence of the decision with the decision maker’s personal standards, rather than as a medal of honor bestowed upon certain decision makers by decision theorists.
Furthermore, I found the inclusion of the section entitled, “Rationality and Emotions” very helpful. Here Gilboa says, “To conclude, we do not seem to have good measures of happiness.
Moreover, it is far from obvious that “we know it when we see it. One possible conclusion, in line with the position of John Rawls, is that social policies should focus on the minimization of misery rather than on the maximization of happiness.
Throughout this book we have encountered questions that arise in the social sciences and that lead us to traditional questions in philosophy. Problems that range from the definition of probability to the meaning of happiness, from the notion of rationality to essence of justice, belong to the realm of philosophy, but they pop up in practical guises in questions of the social sciences.
Most of these philosophical questions do not have objective or scientific answers. Correspondingly, many practical problems in the social sciences cannot be settled based on scientific enquiry alone, and therefore they cannot be relegated to experts. Rather, these questions should be tackled by each and every individual.
I believe that the rational choice paradigm can be a powerful aid in thinking about such problems. Itzhak Gilboa is one of my favorite economists. Cambridge University Press, is path breaking in amending the traditional Savage “small world” model of rational choice to be more realistic and useful. Rational Choice aims to present rational choice theory for newcomers without social scientific, philosophical, or mathematical expertise. Despite is diminutive size, the book ends up as a broadly accurate description of the current state of rational choice theory.
Gilboa is well aware of the limitations of standard the rational actor model, and makes no attempt in this book to go beyond this model despite his own brilliant work on “case-based choice theory”. Rather, he considers the model as a “paradigm” rather than a “theory. Gilboa urges the reader to add rational choice theory to his repertoire of tools used to assess social policy. Rational Choice claims to be a “rigorous, concise, and nontechnical introduction to some of the fundamental insights of rational choice theory.
The book appears to be directed to the layman with innate but inchoate prejudices against rational choice theory, but I doubt that such an individual will find this volume convincing. Most opposition to rational choice theory that I have encountered, even when offered by professional behavioral scientists, is in fact couched in vague often even and ignorant terms. But there is a real critique of the theory. Gilboa simply doesn’t locate it. For instance, Chapter 8 on Free Markets presents a very realistic objection to free markets and globalization in which the defender of market equilibrium, using the First Welfare Theorem, is completely incapable of even making a dent in the critics’ arguments, and storms off in an angry huff.
Gilboa’s problem is twofold. First, the only plausible argument for free markets is dynamic and based on the innovative implications of competition and not on the First Welfare Theorem.
In fact, as Arnold Harberger showed many years ago, the welfare losses of protection are generally quite small. Second, this issue has nothing to do with rational choice. Free markets have some desirable static allocational properties if agents make choices that are consistent with their welfare. Rational choice, as has been evident at least since Gary Becker’s study of addiction and contemporary models of obesity, has no clear connection to making choices consonant with personal welfare.
Gilboa offers an indefensible definition of rationality. Spurning the traditional consistency definition of Savage and others, Gilboa offers the following: If we add some ancillary assumptions, such as “a person will be embarrassed to find that his choices are inconsistent,” then we restore the traditional definition of rationality. Why then this roundabout definition, couched in terms of the persuasive power of the author and presuming a high level of cognitive functioning of the rational agent?
Gilboa argues that “An irrational mode of behavior is one that I can hope to change by talking to the decision maker, by explaining the theory to him, and so forth. In the rest of the book, Gilboa does stick to the traditional definition of rationality, but he never explains why.
In Chapter 2, Gilboa tries to explain why a young lady, Ann, ignorant of rational choice ratiknal, could improve her ability to solve her problem of choosing among boyfriends by applying rational choice theory. He quite fails to convince. Indeed, I cannot imagine why knowledge of rational choice theory could help Ann make such a decision.
Gilboa also treats very breezily some issues that merit lengthy argumentation and many ratilnal. For instance, he treats base rate bias and conditional probabilities with a single example and biased samples with another single simple giboa. There is little chance a novice with appreciate the importance of these issues.
They are choicd explained with simple arithmentic and elementary probability theory. Perhaps the most egregious failure of this book is to deal in any consistent way with empirical studies of human behavior in the context of strategic interaction. Instead, Gilboa gives off-hand observations about daily life that insult the critical faculties of the reader.
Indeed, Gilboa’s mode of argumentation makes understanding empirical studies conceptually impossible. For instance, it is well known that many individuals prefer to cooperate in a prisoner’s dilemma, provided that they have some assurance that their partners will cooperate as well.
Indeed, this finding is one of the more striking regularities in behavioral game theory.