Rational Choice Theory - Apfelbaum, Inc.

One of the major underpinnings of modern economic and political understanding is a broad paradigm of human behavior called rational choice theory. Different economists and social scientists apply it differently, but it essentially means that left to their own devices people will make decisions that maximize their spending power when they are buying and try to maximize their happiness when they are making other social decisions. Rational choice theory is so much of a core assumption of most social science that it is rarely addressed. And yet people so often make choices that seem to optimize their unhappiness and waste their money that one would think that the theory itself would get more critical evaluation. Take our hobby for example. How many people pick a specialty with any degree of forethought as to their greatest happiness? And mounting and storage? Every dealer has unending stories of collectors who kept stamps in such bad conditions as to ruin most of their value and thus their owner’s investment. And many collectors are foolish buyers and sellers. Most dealers would tell you that when it comes to collecting some philatelists are rational and most are not. And this is probably true of most people’s non-philatelic choices as well.

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