Becker Random Behavior and the As-If Defense of Rational Choice Theory in Demand Analysis
Bocconi University - Department of Economics
University of Greenwich; CNRS
June 15, 2011
Journal of Economic Methodology, Vol. 18, No. 2, pp. 107–128, June 2011
In discussing rational choice theory (RCT) as an explanation of demand behavior, Becker (1962, Journal of Political Economy, 70, 1–13) proposed a model of random choice in which consumers pick a bundle on their budget line according to a uniform distribution. This model has then been used in various ways to assess the validity of RCT and to support as-if arguments in defense of it. This paper makes both historical and methodological contributions. Historically, it investigates how the interpretation of Becker random behavior evolved between the original 1962 article and the modern experimental literature on individual demand, and surveys six experiments in which it has been used as an alternative hypothesis to RCT. Methodologically, this paper conducts an assessment of the as-if defense of RCT from the standpoint of Becker’s model. It argues that this defense is ‘weak’ in a number of senses, and that it has negatively influenced the design of experiments about RCT.
Keywords: rational choice, random choice, as-if defense of scientific theories
JEL Classification: B41, C14, D11, D12Accepted Paper Series
Date posted: July 18, 2011
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