Calculus of Consent Ch4

Chapter 4: Individual Rationality in Social Choice
政治系國關組四年級賴文涵
I. Summary
A. Individual and Collective Rationality
Prior to defining what “rationality” is, the author suggests that we shall specify the object, or “the decision-making unit”, at the first place.
The author supposes that problems arise when regarding the collectivity as “the decision making unit”. Therefore, he advises that we consider the individual participant in collective choice as the only real decision-maker, and discuss rational behavior only in terms of the individual’s own goal achievement. This section, thus, is fundamentally provided in comparison of the two approaches, “individual” and “collective” rationality.
In the model of collective rationality, there is the presumption that the goals of collective action are commonly shared, and significant individual and group differences are incorporated in it. By contrast, the book presupposes the “individual rationality” analytical model, in which rational behavior can only be discussed meaningfully in terms of individual action.

B. Individual Rationality in Market Choice
Subsequent to the illustration of distinction between individual and collective rationality in the first section, the author introduces the definition of rational individual behavior, according to the traditional economic theory.
In the traditional economic theory, the average individual is able to rank or to order all alternative combinations of goods and services that may be placed before him and that this ranking is transitive. Behavior of the individual is said to be “rational” when the individual chooses “more” than “less” and when he is consistent in his choices. In brief, the section generally gives a review on the individual rationality vis-?-vis the market choices.



C. Individual Rationality and Collective Choice
In fact, not until this section does the author initiate his interpretation of individual rationality towards political collective choice. The author begins to extend the economic conception of individual rationality to collective choices, which constitutes the main argument of this chapter.
To begin with, he suggests that the individual can choose from not only market goods but also public goods. Also, the individual is able to rank the various bundles of public or collective goods in the same way that he ranks private goods. Furthermore, there is a diminishing marginal rate of substitution between public and private goods, on the one hand, and among the separate public goods on the other. Theoretically, as the consumer’s rational behavioral pattern applied to the citizen’s collective-choice process, the individual follows the basic law of supply and demand. (eg. The individual chooses more public goods when the price of these is lowered.)
Nevertheless, the author admits that the generalization above reflects a critical conceptual leap in terms of the gap between individual and group choice. Consequently, at this stage of analysis, we cannot in fact achieve the same degree of support for behavioral assumptions about individual action in collective choice that the economist possesses. The more intact explanation, according to the author, will be left in the later parts of the book.

D. Limitations on Individual Rationality
In this part, the author explores the existent uncertainty in the political decision making process, in contrast to the assumptive perfect certainty in individual market choice.
On the one hand, the individual participant has no way of knowing the final outcome. This uncertainty in political choice seems to limit the original rational individual behavior to some significant extent. On the other hand, the individual loses the sense of decision-making responsibility that is inherent in private choice. In collective choice process there is no such thing as a precise relationship between individual action and result, in contrast with private choice process. Consequently, we should not expect models, based on the assumption of rational individual behavior, to be completely invariant as they are applied to the market or economic choices.
In response to these limitations on individual rationality, the author indicates that we can actually reduce them to some extent in the continuous process of collective choice. Each unique decision represents only one link in a long-time chain of social action. He also mentions, through some form of exchange or trade, the limitation of uncertainty can be neutralized. For instance, if the vote of the individual choice is recognized as being subject to exchange for the votes of other individuals in later choices, uncertainty is eliminated. As a result, despite some limitations of the model, we should yet stick to the individual rationality approach as our analytical tool.

E. Conclusion
In chapter four, the author firstly introduces the individual and collective rationality as two respective approaches, the former as a major thesis of the chapter as well as the book. Subsequently, he provides the reader with a brief brush-up of rational individual behavior in the economic theory, as a foundation of the later collective choice analysis. After the economical interpretation in the second section, he starts the political implication for the collective choice, i.e. the consumer’s individual choice pattern is similar to the citizen’s collective-choice process. Lastly, although there are limitations on the model of individual rationality, the model is undoubtedly worth being applied.

II. Self-Questioning & Discussion
1. How to define “the decision making unit”?
2. What is the economical analysis of individual rationality? And what is the interconnection between the economical and political individual rationality?
3. How does the author derive the collective choice model from individual rationality?
4. What are the limitations of individual rationality model? Do you think they are major or minor limitations?
5. Do the author’s further accounts of the limitations factually eliminate the uncertainty?