The Development of Rationality in Economics

Abstract

The concept of rationality first originated from philosophy and later evolved into rationality in economics, and then rationality has been the basic assumption of mainstream economics. With the development of economics and the integration of multiple disciplines, the concept of rationality in economics has been expanded and evolved, and different economic schools have put forward their own concepts of rationality. Classical and neoclassical economics advocate the complete rationality based on the hypothesis of "economic man"; later, behavioral economics and other schools have questioned the complete rationality, and they have proposed bounded rationality or irrationality; in fact, some other scholars have also proposed some other concepts of rationality, such as “evolutionary rationality”, “reasoned scrutiny  rationality”, “cognitive rationality” and so on, which have made the concept of rationality in economics develop continuously. This paper briefly reviews the sources of the concept of rationality, the concept of rationality in traditional economics, the theory of bounded rationality and the other theories of rationality, in order to clarify the abstract concept of rationality.