MarketRationality
Company Profile

Rationality

Rationality is the quality of being guided by or based on reason. In this regard, a person acts rationally if they have a good reason for what they do, or a belief is rational if it is based on strong evidence. This quality can apply to an ability, as in a rational animal, to a psychological process, like reasoning, to mental states, such as beliefs and intentions, or to persons who possess these other forms of rationality. A thing that lacks rationality is either arational, if it is outside the domain of rational evaluation, or irrational, if it belongs to this domain but does not fulfill its standards.

Definition and semantic field
In its most common sense, rationality is the quality of being guided by reasons or being reasonable. For example, a person who acts rationally has good reasons for what they do. This usually implies that they reflected on the possible consequences of their action and the goal it is supposed to realize. In the case of beliefs, it is rational to believe something if the agent has good evidence for it and it is coherent with the agent's other beliefs. The meaning of the terms "rational" and "irrational" in academic discourse often differs from how they are used in everyday language. Examples of behaviors considered irrational in ordinary discourse are giving into temptations, going out late even though one has to get up early in the morning, smoking despite being aware of the health risks, or believing in astrology. In the academic discourse, on the other hand, rationality is usually identified with being guided by reasons or following norms of internal coherence. Some of the earlier examples may qualify as rational in the academic sense depending on the circumstances. Examples of irrationality in this sense include cognitive biases and violating the laws of probability theory when assessing the likelihood of future events. This process aims at improving mental states. Reasoning tries to ensure that the norms of rationality obtain. It differs from rationality nonetheless since other psychological processes besides reasoning may have the same effect. Rationality derives etymologically from the Latin term ''''. ==Disputes about the concept of rationality==
Disputes about the concept of rationality
There are many disputes about the essential characteristics of rationality. It is often understood in relational terms: something, like a belief or an intention, is rational because of how it is related to something else. According to the egoist perspective, rationality implies looking out for one's own happiness. This contrasts with the utilitarian point of view, which states that rationality entails trying to contribute to everyone's well-being or to the greatest general good. For perfectionism, a certain ideal of perfection, either moral or non-moral, is the goal of rationality. According to the intuitionist perspective, something is rational "if and only if [it] conforms to self-evident truths, intuited by reason". Externalists have responded to this objection by distinguishing between motivational and normative reasons. The problem of rationality is primarily concerned with normative reasons. This is especially true for various contemporary philosophers who hold that rationality can be reduced to normative reasons. According to Robert Audi, this can be explained in terms of experience: what is rational depends on the agent's experience. Since different people make different experiences, there are differences in what is rational for them. But there are also thought experiments in favor of the normativity of rationality. One, due to Frank Jackson, involves a doctor who receives a patient with a mild condition and has to prescribe one out of three drugs: drug A resulting in a partial cure, drug B resulting in a complete cure, or drug C resulting in the patient's death. The doctor's problem is that they cannot tell which of the drugs B and C results in a complete cure and which one in the patient's death. The objectively best case would be for the patient to get drug B, but it would be highly irresponsible for the doctor to prescribe it given the uncertainty about its effects. So the doctor ought to prescribe the less effective drug A, which is also the rational choice. This thought experiment indicates that rationality and normativity coincide since what is rational and what one ought to do depends on the agent's mind after all. The opposite can also be the case: bad luck may result in failure despite a responsible, competent performance. This explains how rationality and normativity can come apart despite our practice of criticizing irrationality. Normative and descriptive theories The concept of normativity can also be used to distinguish different theories of rationality. Normative theories explore the normative nature of rationality. They are concerned with rules and ideals that govern how the mind should work. Descriptive theories, on the other hand, investigate how the mind actually works. This includes issues like under which circumstances the ideal rules are followed as well as studying the underlying psychological processes responsible for rational thought. Descriptive theories are often investigated in empirical psychology while philosophy tends to focus more on normative issues. This division also reflects how different these two types are investigated. An important question in this field concerns the relation between descriptive and normative approaches to rationality. So just because a certain heuristic or cognitive bias is present in a specific case, it should not be inferred that it should be present. One approach to these problems is to hold that descriptive and normative theories talk about different types of rationality. This way, there is no contradiction between the two and both can be correct in their own field. Similar problems are discussed in so-called naturalized epistemology. Conservatism and foundationalism Rationality is usually understood as conservative in the sense that rational agents do not start from zero but already possess many beliefs and intentions. Reasoning takes place on the background of these pre-existing mental states and tries to improve them. This way, the original beliefs and intentions are privileged: one keeps them unless a reason to doubt them is encountered. Some forms of epistemic foundationalism reject this approach. According to them, the whole system of beliefs is to be justified by self-evident beliefs. Examples of such self-evident beliefs may include immediate experiences as well as simple logical and mathematical axioms. An important difference between conservatism and foundationalism concerns their differing conceptions of the burden of proof. According to conservativism, the burden of proof is always in favor of already established belief: in the absence of new evidence, it is rational to keep the mental states one already has. According to foundationalism, the burden of proof is always in favor of suspending mental states. For example, the agent reflects on their pre-existing belief that the Taj Mahal is in Agra but is unable to access any reason for or against this belief. In this case, conservatives think it is rational to keep this belief while foundationalists reject it as irrational due to the lack of reasons. In this regard, conservatism is much closer to the ordinary conception of rationality. One problem for foundationalism is that very few beliefs, if any, would remain if this approach was carried out meticulously. Another is that enormous mental resources would be required to constantly keep track of all the justificatory relations connecting non-fundamental beliefs to fundamental ones. == Types ==
Types
Rationality is discussed in a great variety of fields, often in very different terms. While some theorists try to provide a unifying conception expressing the features shared by all forms of rationality, the more common approach is to articulate the different aspects of the individual forms of rationality. The most common distinction is between theoretical and practical rationality. Other classifications include categories for ideal and bounded rationality as well as for individual and social rationality. In both cases, believing in the premises of an argument makes it rational to also believe in its conclusion. The difference between the two is given by how the premises support the conclusion. For deductive reasoning, the premises offer the strongest possible support: it is impossible for the conclusion to be false if the premises are true. The premises of non-deductive arguments also offer support for their conclusion. But this support is not absolute: the truth of the premises does not guarantee the truth of the conclusion. Instead, the premises make it more likely that the conclusion is true. In this case, it is usually demanded that the non-deductive support is sufficiently strong if the belief in the conclusion is to be rational. Practical All forms of practical rationality are concerned with how we act. It pertains both to actions directly as well as to mental states and events preceding actions, like intentions and decisions. There are various aspects of practical rationality, such as how to pick a goal to follow and how to choose the means for reaching this goal. Other issues include the coherence between different intentions as well as between beliefs and intentions. For various other practical phenomena, there is no clear consensus on whether they belong to this domain or not. For example, concerning the rationality of desires, two important theories are proceduralism and substantivism. According to proceduralism, there is an important distinction between instrumental and noninstrumental desires. A desire is instrumental if its fulfillment serves as a means to the fulfillment of another desire. On this view, theoretical rationality is about how the mind corresponds to the world by representing it. Practical rationality, on the other hand, is about how the world corresponds to the ideal set up by the mind and how it should be changed. But on the theoretical level, one does not have to form a belief about which route was taken upon hearing that someone reached the goal. In this case, the arbitrary choice for one belief rather than the other would be theoretically irrational. Instead, the agent should suspend their belief either way if they lack sufficient reasons. Another difference is that practical rationality is guided by specific goals and desires, in contrast to theoretical rationality. So it is practically rational to take medicine if one has the desire to cure a sickness. But it is theoretically irrational to adopt the belief that one is healthy just because one desires this. This is a form of wishful thinking. A similar idea is defended by Jesús Mosterín. He argues that the proper object of rationality is not belief but acceptance. He understands acceptance as a voluntary and context-dependent decision to affirm a proposition. Ideal and bounded Various theories of rationality assume some form of ideal rationality, for example, by demanding that rational agents obey all the laws and implications of logic. This can include the requirement that if the agent believes a proposition, they should also believe in everything that logically follows from this proposition. However, many theorists reject this form of logical omniscience as a requirement for rationality. They argue that, since the human mind is limited, rationality has to be defined accordingly to account for how actual finite humans possess some form of resource-limited rationality. And just like in the individual case, it is possible to study these phenomena as well as the processes and structures that are responsible for them. On the social level, there are various forms of cooperation to reach a shared goal. In theoretical cases, a group of jurors may first discuss and then vote to determine whether the defendant is guilty. Or in the practical case, politicians may cooperate to implement new regulations to combat climate change. These forms of cooperation can be judged on their social rationality depending on how they are implemented and on the quality of the results they bear. Some theorists try to reduce social rationality to individual rationality by holding that the group processes are rational to the extent that the individuals participating in them are rational. But such a reduction is frequently rejected. However, this is not always the case and sometimes groups perform worse due to conformity or unwillingness to bring up controversial issues. Others Many other classifications are discussed in the academic literature. One important distinction is between approaches to rationality based on the output or on the process. Process-oriented theories of rationality are common in cognitive psychology and study how cognitive systems process inputs to generate outputs. Output-oriented approaches are more common in philosophy and investigate the rationality of the resulting states. Another distinction is between relative and categorical judgments of rationality. In the relative case, rationality is judged based on limited information or evidence while categorical judgments take all the evidence into account and are thus judgments all things considered. For example, believing that one's investments will multiply can be rational in a relative sense because it is based on one's astrological horoscope. But this belief is irrational in a categorical sense if the belief in astrology is itself irrational. == Importance ==
Importance
Rationality is central to solving many problems, both on the local and the global scale. This is often based on the idea that rationality is necessary to act efficiently and to reach all kinds of goals. This includes goals from diverse fields, such as ethical goals, humanist goals, scientific goals, and even religious goals. The study of rationality is very old and has occupied many of the greatest minds since ancient Greek. This interest is often motivated by discovering the potentials and limitations of our minds. Various theorists even see rationality as the essence of being human, often in an attempt to distinguish humans from other animals. However, this strong affirmation has been subjected to many criticisms, for example, that humans are not rational all the time and that non-human animals also show diverse forms of intelligence. The topic of rationality is relevant to a variety of disciplines. It plays a central role in philosophy, psychology, Bayesianism, decision theory, and game theory. But it is also covered in other disciplines, such as artificial intelligence, behavioral economics, microeconomics, and neuroscience. Some forms of research restrict themselves to one specific domain while others investigate the topic in an interdisciplinary manner by drawing insights from different fields. == Paradoxes of rationality ==
Paradoxes of rationality
The term paradox of rationality has a variety of meanings. It is often used for puzzles or unsolved problems of rationality. Some are just situations where it is not clear what the rational person should do. Others involve apparent faults within rationality itself, for example, where rationality seems to recommend a suboptimal course of action. ==History==
History
Max Weber scholar Max Weber notably articulated a theory of rationality that divided human capacity to think through things in four ways. The German scholar Max Weber proposed an interpretation of social action that distinguished between four different idealized types of rationality. and also from a feminist perspective (Eagleton, 2003) whereby Weber's rationality constructs are viewed as imbued with masculine values and oriented toward the maintenance of male power. An alternative position on rationality (which includes both bounded rationality, as well as the affective and value-based arguments of Weber) can be found in the critique of Etzioni (1988), who reframes thought on decision-making to argue for a reversal of the position put forward by Weber. Etzioni illustrates how purposive/instrumental reasoning is subordinated by normative considerations (ideas on how people 'ought' to behave) and affective considerations (as a support system for the development of human relationships). Richard Brandt Richard Brandt proposed a "reforming definition" of rationality, arguing someone is rational if their notions survive a form of cognitive-psychotherapy. Robert Audi Robert Audi developed a comprehensive account of rationality that covers both the theoretical and the practical side of rationality. This account centers on the notion of a ground: a mental state is rational if it is "well-grounded" in a source of justification. Audi asserts that all the basic sources providing justification for the foundational mental states come from experience. As for beliefs, there are four types of experience that act as sources: perception, memory, introspection, and rational intuition. The main basic source of the rationality of desires, on the other hand, comes in the form of hedonic experience: the experience of pleasure and pain. So, for example, a desire to eat ice-cream is rational if it is based on experiences in which the agent enjoyed the taste of ice-cream, and irrational if it lacks such a support. Because of its dependence on experience, rationality can be defined as a kind of responsiveness to experience. Actions, in contrast to beliefs and desires, do not have a source of justification of their own. Their rationality is grounded in the rationality of other states instead: in the rationality of beliefs and desires. Desires motivate actions. Beliefs are needed here, as in the case of instrumental desires, to bridge a gap and link two elements. Audi distinguishes the focal rationality of individual mental states from the global rationality of persons. Global rationality has a derivative status: it depends on the focal rationality. Or more precisely: "Global rationality is reached when a person has a sufficiently integrated system of sufficiently well-grounded propositional attitudes, emotions, and actions". Rationality is relative in the sense that it depends on the experience of the person in question. Since different people undergo different experiences, what is rational to believe for one person may be irrational to believe for another person. That a belief is rational does not entail that it is true. ==In various fields==
In various fields
Ethics and morality The problem of rationality is relevant to various issues in ethics and morality. The principle of universality has been suggested as a basic principle both for morality and for rationality. An important psychological area of study focuses on cognitive biases. Cognitive biases are systematic tendencies to engage in erroneous or irrational forms of thinking, judging, and acting. Examples include the confirmation bias, the self-serving bias, the hindsight bias, and the Dunning–Kruger effect. Some empirical findings suggest that metacognition is an important aspect of rationality. The idea behind this claim is that reasoning is carried out more efficiently and reliably if the responsible thought processes are properly controlled and monitored. However, it has been argued that many standard tests of reasoning, such as those on the conjunction fallacy, on the Wason selection task, or the base rate fallacy suffer from methodological and conceptual problems. This has led to disputes in psychology over whether researchers should (only) use standard rules of logic, probability theory and statistics, or rational choice theory as norms of good reasoning. Opponents of this view, such as Gerd Gigerenzer, favor a conception of bounded rationality, especially for tasks under high uncertainty. The concept of rationality continues to be debated by psychologists, economists and cognitive scientists. The psychologist Jean Piaget gave an influential account of how the stages in human development from childhood to adulthood can be understood in terms of the increase of rational and logical abilities. He identifies four stages associated with rough age groups: the sensorimotor stage below the age of two, the preoperational state until the age of seven, the concrete operational stage until the age of eleven, and the formal operational stage afterward. Rational or logical reasoning only takes place in the last stage and is related to abstract thinking, concept formation, reasoning, planning, and problem-solving. Certain findings in cognitive science and neuroscience show that no human has ever satisfied this criterion, except perhaps a person with no affective feelings, for example, an individual with a massively damaged amygdala or severe psychopathy. Thus, such an idealized form of rationality is best exemplified by computers, and not people. However, scholars may productively appeal to the idealization as a point of reference. In his book, The Edge of Reason: A Rational Skeptic in an Irrational World, British philosopher Julian Baggini sets out to debunk myths about reason (e.g., that it is "purely objective and requires no subjective judgment"). Cognitive and behavioral sciences Cognitive and behavioral sciences try to describe, explain, and predict how people think and act. Their models are often based on the assumption that people are rational. For example, classical economics is based on the assumption that people are rational agents that maximize expected utility. However, people often depart from the ideal standards of rationality in various ways. For example, they may only look for confirming evidence and ignore disconfirming evidence. Another factor studied in this regard are the limitations of human intellectual capacities. Many discrepancies from rationality are caused by limited time, memory, or attention. Often heuristics and rules of thumb are used to mitigate these limitations, but they may lead to new forms of irrationality. This often results in a Nash equilibrium, which constitutes a set of strategies, one for each player, where no player can improve their outcome by unilaterally changing their strategy. For example, it would be irrational to have a credence of 0.9 that it will rain tomorrow together with another credence of 0.9 that it will not rain tomorrow. This account of rationality can also be extended to the practical domain by requiring that agents maximize their subjective expected utility. This way, Bayesianism can provide a unified account of both theoretical and practical rationality. Firstly, there is the concept of instrumentality—basically the idea that people and organisations are instrumentally rational—that is, adopt the best actions to achieve their goals. Secondly, there is an axiomatic concept that rationality is a matter of being logically consistent within your preferences and beliefs. Thirdly, people have focused on the accuracy of beliefs and full use of information—in this view, a person who is not rational has beliefs that do not fully use the information they have. Debates within economic sociology also arise as to whether or not people or organizations are "really" rational, as well as whether it makes sense to model them as such in formal models. Some have argued that a kind of bounded rationality makes more sense for such models. Others think that any kind of rationality along the lines of rational choice theory is a useless concept for understanding human behavior; the term homo economicus (economic man: the imaginary man being assumed in economic models who is logically consistent but amoral) was coined largely in honor of this view. Behavioral economics aims to account for economic actors as they actually are, allowing for psychological biases, rather than assuming idealized instrumental rationality. Artificial intelligence The field of artificial intelligence is concerned, among other things, with how problems of rationality can be implemented and solved by computers. International relations There is an ongoing debate over the merits of using "rationality" in the study of international relations (IR). Some scholars hold it indispensable. Others are more critical. Still, the pervasive and persistent usage of "rationality" in political science and IR is beyond dispute. "Rationality" remains ubiquitous in this field. Abulof finds that Some 40% of all scholarly references to "foreign policy" allude to "rationality"—and this ratio goes up to more than half of pertinent academic publications in the 2000s. He further argues that when it comes to concrete security and foreign policies, IR employment of rationality borders on "malpractice": rationality-based descriptions are largely either false or unfalsifiable; many observers fail to explicate the meaning of "rationality" they employ; and the concept is frequently used politically to distinguish between "us and them." ==Criticism==
Criticism
The concept of rationality has been subject to criticism by various philosophers who question its universality and capacity to provide a comprehensive understanding of reality and human existence. Friedrich Nietzsche, in his work "Beyond Good and Evil" (1886), criticized the overemphasis on rationality and argued that it neglects the irrational and instinctual aspects of human nature. Nietzsche advocated for a reevaluation of values based on individual perspectives and the will to power, stating, "There are no facts, only interpretations." Martin Heidegger, in "Being and Time" (1927), offered a critique of the instrumental and calculative view of reason, emphasizing the primacy of our everyday practical engagement with the world. Heidegger challenged the notion that rationality alone is the sole arbiter of truth and understanding. Max Horkheimer and Theodor Adorno, in their seminal work "Dialectic of Enlightenment" (1947), questioned the Enlightenment's rationality. They argued that the dominance of instrumental reason in modern society leads to the domination of nature and the dehumanization of individuals. Horkheimer and Adorno highlighted how rationality narrows the scope of human experience and hinders critical thinking. Michel Foucault, in "Discipline and Punish" (1975) and "The Birth of Biopolitics" (1978), critiqued the notion of rationality as a neutral and objective force. Foucault emphasized the intertwining of rationality with power structures and its role in social control. He famously stated, "Power is not an institution, and not a structure; neither is it a certain strength we are endowed with; it is the name that one attributes to a complex strategic situation in a particular society." These philosophers' critiques of rationality shed light on its limitations, assumptions, and potential dangers. Their ideas challenge the universal application of rationality as the sole framework for understanding the complexities of human existence and the world. ==See also==
tickerdossier.comtickerdossier.substack.com