ABSTRACT
Economic theory has always had difficulty dealing with children, because children cannot be assumed to behave as rational economic agents. All legislative systems have a notion of an age of majority before which children cannot be expected to behave as full citizens. Below such an age (frequently, in practice, there are a whole series of such ages covering different aspects of life), children are not considered mature enough to make decisions and somebody else, whether an individual parent, a guardian or the state, has to make choices for them. Similarly, in economic theory, children cannot be expected to know what is best for themselves and to act consistently in their own best interests; their interests are therefore usually subsumed under those of others. For neo-classical economics, with its commitment to methodological individualism based on rational choice, the failure of children to behave ‘rationally’ is a major theoretical difficulty, which it tends to sidestep by ignoring the separate interests of children and of those who behave equally irrationally in caring for them.
