Rationality in Economics

The rationality model needs to change to include the economic agent’s inner moral life, as suggested by Martha Nussbaum. In this way, economic rationality stricto sensu, which is ultimately called into play, would have a heavy, first, deliberative, then, normative content. The cognitive nature of emotions would allow these to be included as additional determining factors in the human decision-making process. The concept of self-interest often gets confused with the idea of internal consistency when utility (or self-interest) is defined as the relationship between revealed advantages. Nevertheless, while internal consistency is a category that is too permissive, self-interest, or utility, is too restrictive. In the real world, economic decisions are made under uncertainty, and animal spirits and cognitive biases play a central role. The development of economic models ought to be compatible with the knowledge generated in other branches of the sciences that investigate human behaviour.