From Bounded Rationality to Behavioral Economics
Journal Title: STORIA DEL PENSIERO ECONOMICO
Author/s: Massimo Egidi
Year: 2006 Issue: 1 Language: Italian
FullText PDF: 111 KB
The paper examines the way traditional theory of rationality has been revised following new approaches based upon behaviourism and experimental economics. Particular attention is given to the early experimental methods of Maurice Allais with which he criticised the descriptive and predictive powers of the orthodox theory of choice and specifically Friedman’s methodology. The paper then focuses on Herbert Simon’s research project which also gave ample scope to the cognitive characteristics of the choice processes ultimately providing inspiration to the behavioural approach of Kahneman and Tversky. With their contribution the major shortcoming of Allais’ early experimental economics were overcome and a new course of interaction between psychology and economics was established.
Massimo Egidi, in "STORIA DEL PENSIERO ECONOMICO" 1/2006, pp. , DOI: