The locality and globality of instrumental rationality: the normative significance of preference reversals

Abstract When we ask a decision maker to express her preferences, it is typically assumedWhen we ask a decision maker to express her preferences, it is typically assumed that we are eliciting a pre-existing set of preferences. However, empirical research has suggested that our preferences are often constructed on the fly for the decision problem at hand. This paper explores the ramifications of this empirical research for our understanding of instrumental rationality. First, I argue that these results pose serious challenges for the traditional decisiontheoretic view of instrumental rationality, which demands global coherence amongst all of one’s beliefs and desires. To address these challenges, I first develop a minimal notion of instrumental rationality that issues in localized, goal-relative demands of coherence. This minimal conception of instrumental rationality is then used to offer a more sophisticated account of the global aspects of instrumental rationality. The resulting view abandons all-or-nothing assessments of rationality and allows us to evaluate decision makers as being rational to varying degrees. My aim is to propose a theory that is both psychologically and normatively plausible. Decision theory offers a familiar view of deliberation and instrumental rationality. It depicts human agents as possessing a set of standing beliefs and desires that are expressed when they make choices and act. For when an agent deliberates, her beliefs and desires are used to evaluate the available choices, and she acts in the way that she believes will result in the most desirable consequences. Instrumental rationality then demands that decision makers (henceforth DMs) possess a coherent set of preferences for any given deliberative context. And since these preferences are determined by beliefs and desires, instrumental rationality demands that DMs possess a coherent set of beliefs and desires, which means that these beliefs and desires ought to be representable respectively as probabilities and utilities. Let’s call this decision-theoretic demand, Deliberative Coherence. To fully articulate the nature of this demand, we must survey some familiar and unfamiliar details of the decision-theoretic view of deliberation. What is familiar is that DMs face decision problems that are defined by a set of acts that the DM is choosing between along with the consequences that these acts will produce when one of a mutually exclusive and exhaustive set of states obtains. Consequences are propositions that describe what might result from the DM’s actions. States are propositions that describe the ways the world might be independent of the DM’s actions. The DM’s preferences between acts are then determined by her beliefs and desires about, respectively, the states and consequences. ∗For their thoughtful comments and objections, I would like to thank Achille Varzi, Anubav Vasudevan, Dana Howard, Don Hubin, Glenn Ross, Guillermo Del Pinal, John Brunero, John Collins, Katie Gasdaglis, Mark Alfano, Sigrun Svavasdottir, and two anonymous referees for Synthese. I also thank the audiences at Kansas State, Columbia University, the Decisions, Games & Logic Workshop, and the Canadian Society for Epistemology for their comments on earlier versions of the paper. 1While it will not affect my discussion, I will for the sake of concreteness take for granted the standard set of structural requirements on preferences articulated in (Savage 1972). See Part I of (Anand, Pattanaik, and Puppe 2009) for a survey of alternative requirements. I will also be adopting the realistic as opposed to formalistic interpretation of decision theory on which an expected utility function is a measure of beliefs and desires rather than an indicator function that offers a “definitional reformulation” of the DM’s preferences (See pp. 144-146 in Hansson 1988). Of course, the DM may possess “brute” preferences that are inconsistent with those entailed by her beliefs and desires. However, to avoid confusion between these two ways of talking about preferences, I will avoid talk of such brute preferences. 2I will be assuming the separability of belief and desire. See (Levi 1999) and (Jeffrey 1965) for opposing sides of this debate.