How do moral philosophers understand and deploy the theory of rational choice as a normative theory? How do economists understand and deploy the theory of rational choice as a positive theory? In what ways do positive economists assess the success or failure of a theory of rational choice? Would these same sorts of considerations determine the success or failure of a normative theory of rational choice?
Instrumental rationality is an explicit form of Rational Choice Theory which basically deals with the cost-benefit analysis to maximize benefit to a defined end. In doing so, it is clear that instrumental rationality is a question of how rather than why about an act. It provides a blueprint of actions within societies which consider the choices actors in the society while comparing the cost-benefit structure of an action. If we look at economics in perspective of rationality, it is all connected. Economics is a product of rational choice and its outcome in a restricted environment because economics as a part of social science prevails over all others. It is no surprise that instrumental theory of rationality as developed by Thomas Hobbes and advanced by later British behaviorists, lies at the core of economic model. There are many differing views on this model. Followers of Hume belive that rational choice aims at enhancing satisfaction, while others consider terms of preference in attaining satisfaction which only causes more confusion.
However, in the sphere of economics, it has turned out to be a positive theory in the sense that while the complete exposition of “Homo Economicus”, simply put, economic man, should permit for instrumental rationality along with consumptive rationality, the basic root originates from instrumental clarification. This is elaborated by the fact that members of the society with varied aims, all find themselves in some kind of an economic activity as they feel that this activity would lead them to attain their varied objectives. It is no secret, thus, that homo economicus chooses rationality as a better option for fulfilling his economic desires. Nobel laureate Amartya Sen says that the rationality pays attention to the relation between aims and the choices one makes from among the given alternatives: considering your goals, which are already defined, what is the best and most rational course of action to be taken which will generate the maximum returns.
In the philosophical sense, Rational instrumentality is a contradiction as its scope is too limited in certain areas while unlimited in certain others. Rational instrumentality considers any action that sets back our aims as not rational. This means that a person who takes action on someone else’s advice which later turns out to not be in his own best interests, is not rational. Instrumental rationality is a product of an individual’s cognitive faculties and choices in determining what they want to do or not. SO, oversimplification of its nature in such a way is actually quite irrational. For instance, if John sees the weather forecast on television, which predicts bright sunshine and a clear day and decides against carrying an umbrella, finds rain half way to his friend’s house and gets drenched, it is considered irrational. However, if a psychic tells John that it will rain and he carries an umbrella and remains dry, it is considered rational according to this theory. The theory considers all social and moral interactions as absolutely similar to economics and assumes that humans behave in a certain way according to their calculations on rationality, their actions are guided by rationality and their only goal is only maximization of benefits and cutting costs. Moral, ethical and emotional factors have been completely discredited hence making it a limited theory with limited scope.