Abstract We investigate whether the definition of economic rationality as choice consistency is correlated with decision-making ability. Guided by a theoretical framework, we demonstrate that documented positive correlations may be driven by confounding properties unrelated to consistency. To address this, in a novel experiment, we isolate consistency, measured by the Weak Axiom of Revealed Preference. We show that less sophisticated decision-makers often rely on simple rules and behave consistently, while more sophisticated ones consciously randomize, appearing inconsistent. These patterns determine ambiguous correlations, raising doubts about the choice of language that equates consistency with rationality in economics.
Daniele Caliari (Fri,) studied this question.