ABSTRACT
When examining the first branch, that of individual economic planning, the standard model – which is the only relevant model in neoclassical trade theory – we find that this model assumes that individuals (or households or firms) behave rationally and therefore seek to maximize their utility, or their profit, respectively. In addition, the model assumes that individuals will include in this optimization the computation of all available data and all subjective perceptions of their environment that may be relevant to the decision making process. This environment entails – in addition to the individual’s own resources and capabilities – on the one hand, the given circumstances in the marketplace, especially the supply and demand situations, and on the other hand, circumstances external to the market, such as technical production coefficients, legal circumstances, climate conditions, and the like. The former may be termed market data, the latter non-market data.
