ABSTRACT
In the literature of rational choice, there are several apparent paradoxes that lose their paradoxical air upon investigation. Two of these, the Voter’s Paradox and the Prisoner’s Dilemma (and its generalization in collective action, n-person Prisoner’s Dilemma), are particularly important in social theory. (The Voter’s Paradox is the problem of cyclical majorities. Majorities of voters may prefer A to B, B to C, and C to A, so that no candidate can defeat every other.) They result from the aggregation of individually rational choices into social choices. Their paradox is this: that by the canons of rationality applied to individual choices, the social choices are irrational. Individual rationality requires that preference orderings be transitive, and that more-preferred alternatives be chosen over less-preferred. The social or group equivalent of the latter requirement is commonly taken to be that collective choice be Pareto-optimal (that is, that no one can be made better off without making someone else worse off). But in the Prisoner’s Dilemma, the collective result of individually rational choices is not Pareto-optimal, and in the Voter’s Paradox it is not transitive.
