15 Pages

Rationality in reproduction models

Rationality claims, in the original classics, primarily concerned what they regarded as the reasonable, responsible use of the surplus in the accumulation of capital. These claims were made in the French or English of their period, calling upon the rich resources of such natural languages for characterizing, and advocating, what was reasonable, wise and (emphatically!) natural. Neoclassical theory, on the contrary, developed a formal characterization of ‘rationality’ as a choice or action that satisfied an axiom set. Rationality claims were (naively) asserted to be ‘value-free’. Despite loudly proclaimed ‘rigour’, a number of distinguishable versions of what counted as ‘rationality’ were used, some of which were incon ­ sistent with others. Thus neoclassical theorists kept several sets of books. During the Augustan age of Arrow-Debreu models (roughly 1950-75), this formalized analysis greatly impressed the less mathematical social sciences and spread widely. However, with the Balkanization of general equilibrium theory, an increas ­ ingly severe critique of the neoclassical axioms for ‘rationality’ has been growing, even from within the neoclassical economic and decision-theory establishment.