2012
DOI: 10.1504/ijpee.2012.052695
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The empirical evidence against neoclassical utility theory: a review of the literature

Abstract: Current economics textbooks and neoclassical economists justify a theory of consumer behaviour based on utility maximisation on a priori grounds. This methodology follows Lionel Robbins' idea that economic theory is based on logical deduction from postulates which are "simple and indisputable facts of experience." Strong evidence has emerged from many different lines of research that these "simple and indisputable facts of experience" are contradicted by human behaviour. In this article, we summarise some of t… Show more

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Cited by 22 publications
(5 citation statements)
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References 105 publications
(84 reference statements)
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“…in terms of relative income, is a crucial determinant of well-being, which was shown in the empirical literature on well-being and in behavioral economics (e.g. Karacuka and Zaman, 2012;Clark, Diener, Georgellis, and Lucas, 2008;Luttmer, 2005;Falk and Knell, 2004). A milestone in the literature on well-being and relative positions was the seminal article of Easterlin (1974).…”
Section: Employment Flowsmentioning
confidence: 98%
“…in terms of relative income, is a crucial determinant of well-being, which was shown in the empirical literature on well-being and in behavioral economics (e.g. Karacuka and Zaman, 2012;Clark, Diener, Georgellis, and Lucas, 2008;Luttmer, 2005;Falk and Knell, 2004). A milestone in the literature on well-being and relative positions was the seminal article of Easterlin (1974).…”
Section: Employment Flowsmentioning
confidence: 98%
“…In the utilitarian framework, the absence of counter-force gives the way to psychological egoistic bent to exploit and maximize the utility (Karacuka & Zaman, 2012). Indifferent of its variants, egoism in general explicates the "self-interest" with the satisfaction of one's preferences and desires which is but an essential building block of the utilitarian model.…”
Section: Egoism/altruismmentioning
confidence: 99%
“…Self-interested economic agents are the foundation of Neoclassical economic theory. This theory aims to maximize utility or maximize profit (Mehmet & Asad, 2012). Therefore, the allocation of land and natural resources is also aimed at maximizing personal production benefits.…”
Section: Land As the Source Of Economy: A Literature Reviewmentioning
confidence: 99%