The Economic Theory of Utility

In “The Economic Theory of Utility” (CUA Primer, pages 50–51), Amartya Sen criticizes the view that the only thing that motivates people is self-interest. He calls this view the economic theory of utility. Sen here approaches the subject by emphasizing two themes: First, he says this mistaken view of people has held too much too prevalent in the field of economics. (By the way, CUA’s Busch School of Business and Economics offers a richer view in its mission statement.) Second, Sen says that when some economic thinkers present entirely self-interested action as the definition of rationality, they are giving a needlessly impoverished portrayal of human beings and their rationality. He says that the true picture is much richer. In what ways do you think that human beings are more complex that the economic view of utility suggests? How might a richer view combine the selfishness we see in people with the things we see in them that are better? How might a richer view of human beings influence the way we act in economic matters?

Photo: “Tape Pile” by SidewaysSarah is licensed under CC BY 2.0.

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  1. Magdalene Jensen says:

    The Economic Theory of Utility says that any rational human will almost always choose the option that results with the highest benefits for them. I think this theory is logical, but what I think it misses is that the option with the highest utility differs from person to person. The Busch School looks at business and economics with a focus on Catholic social teachings. When looking at business and economics with Catholic teachings as our guide, the option that has the highest utility will likely differ for us than someone who is operating a business with only success on their mind. At the end of the day, no one is going to choose the option that gives them the lowest utility, but I think sacrificing a small amount of profits and choosing an option that benefits the common good is something people do consider.

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