Allison Reading

(Ctools) Allison, Graham, “The Rational Actor,” pp. 28-35, Essence of Decision, 1971.

Essence of Decision – Explaining the Cuban Missile Crisis Allison

• Speaking about international events-notice we slip into the rational actor framework (actions are implicitly intentionally rational
• Game theory-people make optimal choices in narrowly constrained, defined situations
• Act rationally in economics = choose the most efficient alternative
• Concepts of rational action model:
  • Goals and objectives – value or utility of alternative sets of consequences
  • Alternatives – Set of options that are sufficiently different
  • Consequences – Based on choice of alternative
  • Choice – alternative whose consequences rank highest in the decision maker’s payoff function
• Call a decision rational means that the behavior can be fully explained in terms of the goal the actor was trying to achieve
• Comprehensive rationality vs. limited rationality (more common, don’t know everything)

Princen comments

• Removes reality to get at the essence of the issue
• May be assumptions that help explain behavior, i.e. government subsidizing fossil fuels even though we should lessen our dependence