Popper's short essay about the rationality principle has been the target of many criticisms which have raised serious doubts about its consistency. How could the well-known promoter of falsificationism suggest that we not reject a principle that he himself describes as false? Nonetheless, the essay can be read in a way that makes it appear much more consistent. Better sense can be made of Popper's own examples, by taking seriously his view that the rationality principle might be "approximately true" and (...) falsified only in very rare cases, while also giving proper attention to his four rather elliptical arguments. (shrink)

Economical questions indisputably occupy a central place in everyday life. In order to clarify these questions, people generally turn to those who are familiar with economics. In answering such legitimate questions, economists propose explanations which rest on a few principles among which the rationality principle is by far the most fundamental. This principle assumes that people are rational, but what is meant by this has to be specified. Rationality and Explanation in Economicsclaims that only a minimal kind of rationality is (...) required to ‘animate’ economic explanations. However, such a conception of rationality faces serious objections: it is closely associated with harshly criticised methodological individualism and it is not easily disentangled from sheer irrationality. The book answers these objections and shows that the economists’ way of mobilising the concepts of maximization or of consistency for defining rationality raises more serious problems. Since the latter have encouraged various attempts to downgrade or even to dispense with the very notion of rationality, the book is largely devoted to countering arguments associated with these attempts and to show why postulating that agents are rational is still the only efficient way to explain economic phenomena as such. The author also proposes original views about the role of rationality, the meaning of methodological individualism, the relevance of the selection argument and the relation between ‘rational’ explanations of economics and explanations in natural sciences. (shrink)

The paper proposes a distinction between ethical problems internal to the practice of a discipline and ethical problems external to it. It argues that ethical problems encountered in architecture are typically of the former kind, in contrast, for example, to bioethical problems. From this point of view, it discusses the state of other arts and surveys various 19th and 20th century positions concerning ethics in architecture. It illustrates that, where architecture is concerned, ethics is closely related to aesthetics and frequently (...) tied to a philosophy of history, a point which is explained with the help of the above-mentioned distinction. (shrink)

This paper aims to show that, throughout the history of economics, an increasingly wide gap has developed between the rationality principle, usually considered as the fundamental principle of economic science, and the notion of rationality that progressively became a standard component of any model of modern microeconomics. This claim is illustrated through an analysis of the various ways in which ?rationality? was understood from classical economics to contemporary debates where axioms such as transitivity and independence, which contemporary economists associate with (...) the notion of rationality, are subjected to a number of devastating critiques. Another claim of this paper is that, while these critiques put the modern notion of rationality seriously into question, they leave the rationality principle undamaged since they were typically made in the name of that principle. It concludes with an argument emphasising the underestimated importance of the rationality principle for economics. (shrink)

This reassessment of the long debate about Friedman's thesis on the pointlessness of testing assumptions in economics shows that Friedman's three famous examples, on which a large part of the credit given to this thesis is based, far from substantiating it, can be used to establish radically opposite conclusions. Furthermore, it is shown that this so-called “instrumentalist” thesis, when applied by Friedman to economics, is of a quite different nature and raises much more serious problems than the standard instrumentalist thesis (...) devised by some methodologists of physics. To disentangle these ambiguities concerning realism and instrumentalism applied to physics or to economics, this paper refers to Van Fraassen's “constructive empiricism”, which is helpful in reformulating, in a more satisfactory way, the essentials of Friedman's considerations about empiricism and anti-realism. (shrink)

Depuis la parution, en 1950, du célèbre article d'Armen Alchian, il est devenu assez fréquent d'invoquer la sélection naturelle pour appuyer certaines conclusions de l'économie néoclassique. Toute sélection n'étant toutefois pas de type « darwinien », il importe de bien distinguer les arguments qui invoquent la sélection naturelle au sens strict et les arguments crypto-téléologiques qui s'apparenteraientplutôt à un évolutionnisme de type lamarckien. A l'aide de quelques exemples fictifs, dont deux sont empruntés à un essai méthodologique de Milton Friedman de (...) 1953, il est soutenu que les économistes doivent choisir entre des explications prétendument fondées sur la sélection naturelle et des explications fondées sur le principe de rationalité. Plus généralement, il est montré en conclusion, à l'aide de deux exemples supplémentaires, que les explications reposant sur des mécanismes impersonnels et celles reposant sur des activités intentionnelles ne peuvent être invoquées concurremment.Since the publication of Alchian's famous article of 1950, it has become relatively common to invoke natural selection as a justification of various conclusions in neoclassical economics. But because selection is not always of a "Darwinian" type, it is important to distinguish clearly between arguments which invoke natural selection in the strict sense of the word from crypto-teleological arguments which are rather more closely related to a Lamarkian evolutionary approach. With the help of fictional examples, two of which have been borrowed from Milton Friedman's 1953 essay on methodology, it is argued that economists mast choose between explanations supposedly based on natural selection and ones that are based on the principle of rationality. More generally, and with the help of two further examples, it is concluded that explanations based on a anonymous mechanism and those based on intentional activities can not be invoked concurrently. (shrink)

Economics has developed into one of the most specialised social sciences. Yet at the same time, it shares its subject matter with other social sciences and humanities and its method of analysis has developed in close correspondence with the natural and life sciences. This book offers an up to date assessment of economics in relation to other disciplines. -/- This edited collection explores fields as diverse as mathematics, physics, biology, medicine, sociology, architecture, and literature, drawing from selected contributions to the (...) 2005 Annual Conference of the European Society for the History of Economic Thought (ESHET). There is currently much discussion at the leading edges of modern economics about openness to other disciplines, such as psychology and sociology. But what we see here is that economics has drawn on (as well as contributed to) other disciplines throughout its history. In this sense, in spite of the increasing specialisation within all disciplines, economics has always been an open discipline and the chapters in this volume provide a vivid illustration for this. -/- Open Economics is a testament to the intellectual vibrancy of historical research in economics. It presents the reader with a historical introduction to the disciplinary context of economics that is the first of its kind, and will appeal to practising economists and students of the discipline alike, as well as to anybody interested in economics and its position in the scientific and social scientific landscape. -/- Table of Contents -/- Introduction: Economics in relation to other disciplines Richard Arena, Sheila Dow and Matthias Klaes Part I. Economics in relation to the humanities and social sciences 1. The social science of economics Brian J. Loasby 2. Economics and literature Bruna Ingrao 3. Happiness: what Kahneman could have learnt from Pietro Verri Pier Luigi Porta Part II. Economics in relation to the life and natural sciences 4. Newtonian physics, experimental moral philosophy and the shaping of political economy Sergio Cremaschi 5. Evolutionary biology and economic behaviour: re-visiting Veblen's instinct of workmanship Mark Harrison 6. Medicine and economics in pre-classical economics Alain Clément and Ludovic Desmedt Part III. Economics and mathematics 7. Mathematics as the role model for neoclassical economics Nicola Giocoli 8. The role of econometric method in economic analysis: A reassessment of the Keynes-Tinbergen debate, 1938-43 Giovanna Garrone and Roberto Marchionatti IV. Economics and architecture 9. Economics and architecture Maurice Lagueux 10. Economic policies and urban development in Latin America Michele Alacevich and Andrea Costa V. Economics and geography 11. ‘Space’ in economic thought Giovanna Vertova 12. Economics, geography and colonialism in the writings of William Petty Hugh Goodacre Part VI. Economics and sociology 13. Economics and sociology: Gustav Schmoller and Werner Sombart on social differentiation Joachim Zweynert 14. Is Homo Oeconomicus a 'bad guy'? Isabelle This Saint-Jean -/- . (shrink)

There is a general consensus among economists that the notion of rationality plays a central role in microeconomics. It is important to note, however, that they are far from agreement on the meaning of this notion. It would be difficult to lay out a set of welldefined concepts of rationality, but it might be useful to distinguish three quite different approaches around which economists tend to situate themselves when characterising this notion. I prefer to refer to three "approaches" rather than (...) to three concepts, as I did in the title of the paper, because the concepts of rationality which correspond to these approaches cannot be isolated easily. Indeed, their unsettled definitions often overlap, and even when they purport to be related to opposing approaches, they are more or less interrelated. In any case, I propose to refer to these three approaches as "rationality-purposefulness", "rationality-efficiency", and "rationality-consistency". According to rationalitypurposefulness, an action is rational if and only if it is oriented towards the satisfaction of the agent's purpose, as most Austrian economists would tend to say. According to rationality-efficiency, an action is rational if and only if it actually maximises a positively valued magnitude such as utility or profit, as many neoclassical economists would say, especially when adopting a traditional approach. By contrast, rationality-consistency states that choices are rational if and only if it they are consistent as a set, which implies in particular that they are transitive. (shrink)

ABSTRACT: This article proposes an interpretation of the chapters of the Nicomachean Ethics concerning exchange and friendship. Rejecting approaches where Aristotle anticipates modern labour or need-based theories of value, the article claims that those notions of labour and need are required for a satisfactory interpretation of the most obscure passages of Book V Finally, Aristotle’s texts on exchange and friendship are related in such a way that the latter, since it is free from any political considerations, allows us to better (...) understand the philosopher’s view on exchange. (shrink)

The paper aims to assess whether the ideas developed by DonRoss in his recent book Economic theory and cognitive science:microexplanation, which relates neoclassical economics to recentdevelopments in cognitive science, might revolutionize the methodologyof economics. Since Ross challenges a conception of economicsassociated with what is pejoratively called “Folk psychology”, the paperdiscusses ideas of the philosopher Daniel Dennett on which thischallenge is largely based. This discussion could not avoid bearing onquestions such as the nature of consciousness, the interpretation ofontological realism, the relations (...) between agency and selfhood, and thenature and scope of economics. The paper attempts to rehabilitate thetwo pieces of the traditional conception of economics that were mostradically contested by Ross, namely methodological individualism andthe foundational role of rationality in economics. A relativelynuanced judgment on Ross’s bold enterprise is proposed in conclusion. (shrink)

It is frequently repeated that the rationality principle is the fundamental principle of economics and it is so much so that the same principle is equivalently designated as the «economic principle»1. However, it is often the doom of fundamental principles that they are so intimately associated with the science itself that those who practice this science rarely take notice of their presence and of their role. Consequently, it is not surprising not to find any entry for "rationality" or for "rationality (...) principle" in virtually any treaties on economy. If rational behaviour is the object of economics like living organism is the object of biology, specific references could hardly be expected in either of these sciences to what is nothing but the affirmation of the very existence of their subject matter. (shrink)

Ronald Coase is usually considered anything but a methodologist. Thus, it is not surprising that, in the introduction to "How Should Economists Choose?", which is the only paper Coase wrote on a methodological topic, he readily confessed his relative ignorance of philosophy of science, candidly observing that "Words like epistemology do not come tripping from my tongue" (HSEC, 6). However, given the importance of this Nobel Prize winner's contribution to the renewal of theoretical thinking in economics, everyone should admit that (...) his infrequent reflections on methodology, however crude they might look to methodologists, undoubtedly merit close consideration. Whatever methodological clarification these reflections might procure, it is surely worthwhile briefly to analyze them, with the hope of understanding a little better some dimensions of Ronald Coase's way of thinking and, more specifically, of emphasizing some implications of the close relationship between his methodological views and his radical conception of the market. With this in mind, I will first illustrate how far these methodological views seem, at first glance, to be dominated by a fundamental commitment to a straightforward realism; I will then show that they are instead subordinated, in a more complex way, to what I have just called Coase's radical conception of the market and, in conclusion, I will point out some questions raised by this situation. (shrink)

It would be very difficult to discuss the question concerning the hypothesis of omniscience in microeconomics without relating this hypothesis to the more fundamental hypothesis of rationality (usually referred to as rationality principle or postulate) which is at the base of the very idea of an economic theory and even social sciences. Indeed omniscience is a quality which was typically attributed to homo oeconomicus whose essential characteristic is to be perfectly "rational". This association between omniscience and rationality goes back to (...) the marginalist revolution which progressively brought economists to model economic agents as rational calculators who make each decision by systematically maximizing their utility through the standard application of more or less sophisticated mathematical methods. But since the very idea of such a maximization has no meaning if all relevant parameters and variables are not carefully taken into account, it became relatively common to associate omniscience (the required knowledge of such parameters and variables) and rationality (the disposition to make decisions which tend to maximize the degree of success in reaching a goal). (shrink)

Vu l’intérêt croissant que l’on porte aux questions éthiques dans le monde contemporain, on ne s’étonne plus de voir se multiplier les travaux qui discutent la façon dont ces questions se posent dans telle ou telle discipline. Or parmi celles-ci, l’architecture occupe une place assez particulière. Dans la mesure où l’on a affaire à l’un des beaux-arts, il ne va pas de soi que l’on puisse attribuer à l’architecture une fonction éthique, tant il est vrai que l’artiste authentique est en (...) droit de revendiquer une sorte de liberté qui se prête mal au respect inconditionnel d’impératifs d’origine morale. Toutefois, comme l’architecture est un art dont le propre est de répondre à un besoin fondamental de l’être humain, soit celui de trouver un abri et un lieu propice à l’habitation, au travail, à l’étude, au recueillement, à la détente ou à quelque autre activité jugée importante, les architectes ont rarement eu beaucoup de. (shrink)

While it is well known that Carl Menger and Stanley Jevons adopted very different views on the role of mathematics in economics1, it is usually admitted that their respective views on the theory of value were relatively close. Indeed, both strongly objected to the classical theory of value which is based on objective costs of production, whether these be labour or capital costs. Moreover, each elaborated, roughly at the same time, an alternative economic theory based on a comparison between the (...) various degrees to which needs are fulfilled thanks to goods whose effect tends progressively to diminish with the fulfilment of these needs. Furthermore, each managed to ground a theory of economic exchange on the fact that people are rational enough to choose which of two goods will provide them with the greatest benefit. In the face of such similarities, it is tempting to conclude that, while using very different terminologies, these two economists developed quite similar analyses whose key element is a subjective theory of value which was opposed to the objective theory of the classical economists. It is true that specialists of Austrian economics have often underscored the originality of Menger's position and its differences with those of the two other fathers of the so-called marginalist revolution, but while they have seriously questioned the.. (shrink)

There is no doubt that Carl Menger and Ludwig von Mises can be considered as two of the most representative and influential members of the Austrian school of economics. However, given the fact that this school is well known for being a methodological school, it might be surprizing to note how far these two prominent economists apparently stand on methodological questions. While Menger frequently insisted that "no essential differences between the ethical and the natural sciences exists, but at most only (...) one of degree"1, Mises emphasizes the alleged gulf between social and natural sciences to the point of adopting what he called a "methodological dualism". As a consequence of this dualism, Mises did not hesitate when it comes to the analysis of human action to refer to laws "derived a priori" that "permit of no exception" because they belong to "an aprioristic and universally valid theory" 2. Such an uncompromising apriorism was so contrary to the empiricist mood of.. (shrink)