THE EVOLUTION OF RESEARCH OF RATIONAL ECONOMIC BEHAVIOR
Journal Title: Економіка розвитку - Year 2012, Vol 62, Issue 2
Abstract
The analysis of people’s rational economic behavior within various market economy systems is very important as forecasts or different consequences resulted from certain relations as well as economic policy measures are available provided people behave rationally. In practice, the choice is realized in terms of risk and uncertainty, with one of the alternatives in preference.Sometimes decisions are made without thinking, automatically according to conventional behaviour created through many years of practice. There are decisions to which individuals do not attach importance, however, there are decisions requiring long-term thinking due to the unique character of choice. It is the uniqueness of the situation in which the choice is made, vague consequences of the decisions taken and as well as a set of heterogeneous influence factors that should be taken into account. The problem of economic agent rationality is one of the most contentious questions in modern economic theory. Within multi-decade mainstream dominance of neo-classical theory the assumption on rationality has been one of its central categories. However, incomplete information and limited mental capacity are supposed to define the transaction costs that doesn’t correspond to the assumption of complete rationality. That’s why the new institutional economics has focused on the above postulate as well as the concept of incomplete or limited rationality. This paper selectively analyzes the parts of the respective discussion on the human nature, as a new psychological and genetic basis for understanding the economic behavior of people. The above discussions supplement the neo-classical, new-institutional and other research related to rational economic behavior. The scientific importance and practical timeliness of cognitive and psychological analyses of rational economic behavior comprise formalized research modeling, which have undergone experimental and empirical verification in certain and various situations in economic realities. Its hypothesis is that people and their psyche are characterized, apart from the theoretical epithets which is being attached to them by particular economic theories ("economic" and "institutional" man), by a smaller or greater degree of "natural irrationality" associated with the individual-social contradictions, which is immanent in humans.
Authors and Affiliations
Jelena Stjepcevic
Keywords
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