Van der Rijt, Jan-Willem (2005) Transitivity, the Sorites Paradox, and similarity-based reasoning. LSE Choice Group working paper series, vol. 1, no. 4. The Centre for Philosophy of Natural and Social Science (CPNSS), London School of Economics, London, UK.
A persistent argument against the transitivity assumption of rational choice theory postulates a repeatable action that generates a signi…cant benefit at the expense of a negligible cost. No matter how many times the action has been taken, it therefore seems reasonable for a decision-maker to take the action one more time. However, matters are so fixed that the costs of taking the action some large number of times outweigh the benefits. In taking the action some large number of times on the grounds that the bene…ts outweigh the costs every time, the decision-maker therefore reveals intransitive preferences, since once she has taken it this large number of times, she would prefer to return to the situation in which she had never taken the action at all. We defend transitivity against two versions of this argument: one in which it is assumed that taking the action one more time never has any perceptible cost, and one in which it is assumed that the cost of taking the action, though (sometimes) perceptible, is so small as to be outweighed at every step by the significant benefit. We argue that the description of the choice situation in the first version involves a contradiction. We also argue that the reasoning used in the second version is a form of similarity-based decision-making. We argue that when the consequences of using similarity-based decision-making are brought to light, rational decision-makers revise their preferences. We also discuss one method that might be used in performing this revision.
|Item Type:||Monograph (Working Paper)|
|Additional Information:||© 2005 The author|
|Library of Congress subject classification:||H Social Sciences > HB Economic Theory|
|Sets:||Research centres and groups > LSE Choice Group
Research centres and groups > Centre for Philosophy of Natural and Social Science (CPNSS)
Collections > Economists Online
|Identification Number:||vol. 1, no. 4|
|Date Deposited:||08 Feb 2010 11:44|
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