198 8: Rational Choice Th eory and Irrational Behavior
choosing “more rather than less” of their preferences. (2) Only individuals, not
collectives, make decisions. Th is is known as methodological individualism, and
it presumes that collective decisions are aggregations of individual choices, not a
unique property of the group. In laying down the foundations of rational choice
theory, Buchanan and Tullock clearly stated the importance of methodological
individualism to their project: “We start from the presumption that only the indi-
vidual chooses, and that rational behavior . . . can only be discussed meaningfully
in terms of individual action” (32).
From these simple premises, rational choice scholars have deductively con-
structed entire theories of individual and organizational behavior, and extended
the implications deep into the administrative arrangements of government and
the intellectual development of public administration. Indeed, it is diffi cult to
underestimate the impact of rational choice on the applied and scholarly sides of
public administration. Th is impact has been felt in three primary areas. (1) Or-
ganizational behavior: Rational choice theory off ers a comprehensive framework
to answer the question of why bureaucracies and bureaucrats do what they do.
(2) Public service delivery: Rational choice theory off ers an explanation of how
public goods are produced and consumed, and from these insights favors a series
of public-sector reforms that turn traditional public administration presumptions
and prescriptions on their heads. (3) A claim for a new theoretical orthodoxy:
Advocates of rational choice theory have argued that it is the natural successor to
the Wilsonian/Weberian ideas that have dominated a century’s worth of intellec-
tual development in rational choice. Rational choice, some suggest, is not just a
positive theory (an explanation of how the world does work), but also a normative
theory (an explanation of how the world should work). As a normative theory, ra-
tional choice has been argued to be a way to fuse the economic theory formulated
by Smith and the democratic theory formulated by James Madison and Alexan-
der Hamilton. It thus has staked a claim to meet the challenges of Dwight Waldo
and John Gaus, public administration scholars who argued the discipline could
move forward only when administrative theory developed into political theory.
Yet despite the grandiose claims of early rational choice scholars, recent de-
cades have seen a plethora of essays, articles, and books challenging the basic as-
sumptions of rational choice theory. Th e basic premise behind this movement is
that the individual acting as a self-interested utility maximizer is not easily defi ned
in terms of costs and benefi ts. Rather, there are sharp deviations from what would
be considered utility-maximizing behavior, and these deviations tend to follow
a predictable pattern. Emerging research indicates utility maximization includes
some sense of fairness where literally less may be preferred to more (Smith 2006).
At the very least, this new group of scholars argues that utility is quite malleable
and context-dependent. Th ese arguments may have put a mortal wound in the
tenets of rational choice theory, made all the more damaging by the fact that many
of these scholars hail from economics (the discipline directly responsible for ratio-
nal choice theory), notably behavioral and experimental economics.