Using this cost-benefit model, subsequent work expanded the range of
application for rational choice theory, synthesizing the political cost-benefit
concept with the cost-benefit analysis of participation in movements that
Olson pioneered. This produced a more comprehensive rational-choice theory,
which Hirschman (1977, 1972) used to explain that, among other things, the
rise of capitalism was, in essence, preordained, as it represents the ultimate
expression of rational choice. Downs (1997) for example argues that capital-
ism and democracy are in essence, the same thing. However, capitalist soci-
ety never seems to function in the rationally perfect, meritocratic manner its
many proponents predict. Clearly, simple cost-benefit explanations focused
solely on political-economy could not explain all aspects of human life.
Thus, rational-choice theorists directed attention to matters other than
politics and economics – towards culture – yet still with the same economic
rational-choice model in mind. Francis Fukuyama, one of the foremost the-
orists in this area, argues that trust, more than any other factor, constitutes
the basis of modern social order. Following Talcott Parsons ([1951] 1991)
Fukuyama (1996) and Barbara Misztal (1996) define trust as the expectation
that people in general share a common set of values which serve as the basis
for routine interaction. Although this involves a degree of risk, since the
assumption of commonly shared values may be wrong, it is the only way a
complex and diverse society can function. We must be willing to assume the
risk (which investments, whether moral or material, always entail), in order
to reap the benefits. Thus, trust in the face of risk constitutes the foundational
element of rational choice-making.
Quite in vogue today, rational choice theorists view the value of trust, and
its associated risk, as the foundation of modern capitalism and democracy.
They oppose such things as governmental regulation and affirmative action,
which inherently violate the principle of trust. Since all formal systems are
inherently imperfect, they contend that bureaucratization limits the dynamic
potential of social beings (Cook, et al. 2003; Ostrom and Walker 2003; Seligman
2000) because ever greater bureaucratization means simultaneously ever
greater imperfection. Presently, rational-choice theorists believe that not only
does cost-benefit of trust and risk motivate nearly all human decision-making
in society today, but Fukuyama (1996) goes so far as to argue that rational
choice as a cost (risk) versus benefit calculation constitutes the natural essence
of the human species. Trust guarantees nothing, but rather expands our pos-
sibilities and inherently leads to progress because it transgresses the limits
of codified procedure or tradition.
226 • George Lundskow