economic man


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Homo Economicus

A person that desires to maximize his/her needs or desires. Homo economicus is used most of the time to refer to the rational economic actor, who desires wealth, does not desire to work if it can be avoided, and is able to find ways achieve those ends. This assumption is accepted by many economists, especially those who follow rational choice theory, but it remains controversial. The concept of homo economicus was developed by utilitarian thinkers, and contrasts with the constructs of behavioral economics.
Economic manclick for a larger image
Fig. 53 Economic man. The graph demonstrates why, if the assumption of rational consumer behaviour holds, a consumer's INDIFFERENCE CURVES cannot cross. Indifference curves II and I1 I1, show a consumer's preference between two products, X and Y. Point A on indifference curve II represents a higher level of satisfaction to the consumer than point B on indifference curve I1 I1 because point A represents more of both products than point B. Yet point C lies on both curves. This suggest that the consumer, having preferred the combination of goods indicated by point A to the combination represented by point B, now regards them as equal at point C. If the consumer is rational, such an inconsistent or intransitive set of preferences would not arise -hence indifference curves do not intersect.

economic man

an assumption in economic theory that individuals act rationally in specifying their objectives and then take decisions that are consistent with those objectives. Thus, the ENTREPRENEUR will set a goal of PROFIT MAXIMIZATION and will adjust his output and price to achieve this goal. Again, the CONSUMER will seek to maximize his UTILITY or satisfaction and will determine his purchases in the light of his tastes for products and the relative prices of those products. See Fig. 53 for an illustration of rational consumer choice. See CONSUMER RATIONALITY, CONSUMER EQUILIBRIUM, BEHAVIOURAL THEORY OF THE FIRM.
References in periodicals archive ?
But had she just read both of Adam Smith's books, she would have seen that, from the start, the case for the system of natural liberty hardly rested on a narrow conception of economic man.
The Soul of Modern Economic Man, Chicago, University of Chicago Press, 1983.
Neuroeconomics and Behavioral Economics) that do not need such assumptions about rational economic man.
To desire to be like the rational economic man is much like a traditional understanding of sin.
While the economic man maximizes, the administrative man satisfices, i.
Feminist economics as a field has developed through conscientiously stated frameworks and ideologies (Ferber and Nelson Beyond Economic Man : Feminist Theory and Economics (1993); Ferber and Nelson Feminist Economics Today : Beyond Economic Man (2003); Strassmann (2008); Berik, Rodgers and Seguino (2009)).
Her brief but suggestive reading of Gandhi as the quintessential economic man who refashioned trusteeship as an idiom of governance in a deeply paternalist mode could profitably be the starting point for a truly revisionist history of twentieth-century Indian nationalism.
or] our old friend Rational Economic Man resurrected in modern garb' (p7).
And in 'Smithian answers to some puzzling results in the experimental literature', Mafia Paganelli argues that reasons why experimental economists have found that participants in their games do not behave as a rational economic man would behave are in many cases to be found in the writings of Adam Smith, notably in his idea that individuals' behaviour is determined by their seeking the approbation of an impartial observer.
If rational economic man is extinct, as Scientific American argued four years ago, where does that leave economic theory?
Christian democracy differed from classical liberal individualism with its faith in economic man following rational self-interest.
Hewitson, Feminist Economics: Interrogating the Masculinity of Rational Economic Man (Cheltenham: Edward Elgar, 1999); J.