If Interdependent Preferences May Depend on Cognition
نویسنده
چکیده
Economists tend to assume preferences as given (Becker and Stigler, 1977). They are the ultimate exogenous variable the basic and stable block on which economic models are built -. The exogeneity principle has been betrayed at times. Nevertheless, it is still the gate-keeper in support for the principle of parsimony of explanation, which economists have taken from Milton Friedman (1953) as their methodological Bible in justification of rational choice notwithstanding any contrary evidence on bounded rationality -. This is why, in principle, preferences cannot be consented to depend on cognitive factors, for this would make something else at least as fundamental as preferences are. Unfortunately, there are various cases in which the assumption that preferences do not depend on cognition seems, at best, a convenient simplification and, at worst, a deeply misleading one. I shall argue that it is time for economists to start taking cognitive psychology seriously.
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