A New Definition of and Role for Preferences in Positive Economics

Research output: Contribution to journalArticleScientificpeer-review

Abstract

Positive economic models aim to provide truthful explanations of significant (aspects of) economic phenomena. While the notion of ‘preferences’ figures prominently in micro-economic models, it suffers from a remarkable lack of conceptual clarity and rigor. After distinguishing narrow homo economicus models (self-interest maximization) from broader ones (preference satisfaction) and rehearsing the criticisms both have met, I go into the most promising attempt to date at addressing them, developed by Hausman. However, his definition of preferences as ‘total comparative evaluations’, I argue, plays into the general disregard that economists have for human psychology. My alternative definition of preferences as ‘overall comparative evaluations’ – and hence as one of the many factors that influence people’s behavior – allows for more adequate causal explanations of people’s dutiful, committed, and norm-guided actions. Against Hausman but in agreement with Sen, it also allows for (motivated) counterpreferential choice.
Original languageEnglish
Pages (from-to)254-273
JournalJournal of Economic Methodology
Volume24
Issue number3
Early online date2017
DOIs
Publication statusPublished - 2017

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Evaluation
Economics
Influence factors
Psychology
Criticism
Microeconomics
Homo economicus
Economists

Cite this

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title = "A New Definition of and Role for Preferences in Positive Economics",
abstract = "Positive economic models aim to provide truthful explanations of significant (aspects of) economic phenomena. While the notion of ‘preferences’ figures prominently in micro-economic models, it suffers from a remarkable lack of conceptual clarity and rigor. After distinguishing narrow homo economicus models (self-interest maximization) from broader ones (preference satisfaction) and rehearsing the criticisms both have met, I go into the most promising attempt to date at addressing them, developed by Hausman. However, his definition of preferences as ‘total comparative evaluations’, I argue, plays into the general disregard that economists have for human psychology. My alternative definition of preferences as ‘overall comparative evaluations’ – and hence as one of the many factors that influence people’s behavior – allows for more adequate causal explanations of people’s dutiful, committed, and norm-guided actions. Against Hausman but in agreement with Sen, it also allows for (motivated) counterpreferential choice.",
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A New Definition of and Role for Preferences in Positive Economics. / Engelen, Bart.

In: Journal of Economic Methodology, Vol. 24, No. 3, 2017, p. 254-273.

Research output: Contribution to journalArticleScientificpeer-review

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