How robust is rational choice?

Abstract

Neoclassic economic choice theory assumes that decision-makers make choices as if they were rational agents. This assumption has been critically challenged over the last decades, yet systematic aggregation of evidence beyond single experiments is still surprisingly sparse. Here, we asked how robust choice-consistency, as a proxy for rationality, is to endogenous and exogeneous factors. To this end, we conducted a systematic quantitative literature research, reviewing 5327 articles, identifying 44 as relevant that contained hypothesis tests on possible influence factors of choice-consistency. To assess the evidential value of any effect of such influence factors on choice- consistency, we conducted a robust p-curve analysis. Our results indicate that choice-consistency is affected by endogenous or exogeneous factors. This result holds for multiple testing procedures and a robustness check. However, due to the breadth of the contemporary research agenda, the lack of replications and the unavailability of original data in the field of choice-consistency, it is currently not possible to draw meaningful conclusions regarding specific influence factors. Despite this lack of specificity, our results implicate that people’s decisions might be a noisier and more biased indicator of their underlying preferences than previously thought. Hence, we provide systematic evidence for the wide-spread belief that rationality cannot be assumed unconditionally.

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