Saturday, August 11, 2018

Rationality and Spending

The concept of 'rationality' that is a staple of contemporary Economics is rarely defined, but their Capitalist orientation, a system rooted in British Empiricism/Sentimentalism, suggests that it is most likely Humean, rather than Spinozan, Kantian, or Hegelian.  In other words, Reason is most likely implicitly Instrumental in these works.  Accordingly, the 'rationality' of behavior is independent of any End that it seeks.  Hence, if, as seems to be generally accepted, Profit-Maximization is 'rational', it is so only by virtue of being the goal of some Means, e. g. hard work, investment, deception, etc., i. e. because Selfishness of any variety is an instinct, and, hence, not a Means to an End.  Likewise, any spending is 'rational' simply by virtue of being a means to acquiring a product or a service, independent of the worthiness of them.  In some cases, such worthiness seems patent, e. g. when vital goods are purchased.  But, in others, the classification of 'rational' behavior seems to stretch the concept, e. g. when money is put towards destructive consequences.  Nevertheless, based on the concept of Rationality as Instrumental, spending money on medicine, on porn, and on a hit man, are equally 'rational'.  Thus, for example, even if Marginal Utility explains why someone might pay for diamonds, it has no bearing on the Rationality of the act, which consists entirely in handing over some money as a means to acquiring them.

No comments:

Post a Comment