The rationality postulate in economics: its ambiguity, its deficiency and its evolutionary alternative

Though the rationality postulate is generally considered the paradigmatic core of economics, there is little agreement about its specific content and methodological status. This paper seeks to clarify some of the ambiguity surrounding the postulate by drawing a distinction between the non‐refutable, purely heuristic rationality principle and refutable rationality hypotheses. An alternative, evolutionary outlook at purposeful human behavior is outlined that captures much of what makes the rationality postulate attractive to economists but avoids the ambiguities that have made it the subject of enduring controversy.