Research Article Open Access

Irrationality in the Neoclassical Definition of Rationality

Steve Keen1
  • 1 ,
American Journal of Applied Sciences
Volume 2 No. 13, 2005, 61-68

DOI: https://doi.org/10.3844/ajassp.2005.61.68

Published On: 18 December 2005

How to Cite: Keen, S. (2005). Irrationality in the Neoclassical Definition of Rationality. American Journal of Applied Sciences, 2(13), 61-68. https://doi.org/10.3844/ajassp.2005.61.68

Abstract

In this study we are not arguing that competition as it actually occurs in practice is not socially beneficial. Our criticism is directed instead at the false belief that rational profit-maximizing behavior and competition as defined by neoclassical economic theory will lead to a welfare-maximizing outcome-again, as defined by neoclassical theory.

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Keywords

  • Marshall
  • Cournot-Nash style competitive behavior
  • game theory
  • irrationality
  • complex behavior/dynamics