CONCLUSION
The rational actor model, which eludes the structure of action required by farsighted preferences, personal restraint, or commitment, is taught in the most elite citadels of learning.74 It is standard to introduce puzzles of action by asserting that monetary payoffs directly reflect agents’ preferences over action and outcomes.75 Textbook rational actors would accept and even seek golden opportunities for self-gain made by excluding themselves from the common rules guiding conduct.
Numerous interactions are viewed as Prisoner’s Dilemma: when I sell you my house, I prefer to walk away with your money and the house71 John Rawls, Theory of Justice (Cambridge, MA: Belknap Press, 1971).
72 Although at first Rawls argued that his theory of justice and concept of duty of fair play were consistent with rational choice theory, he was persuaded of the opposite by critics. For discussion and commentary, see Rawls, “Justice as Fairness: Political, not Metaphysical,” Philosophy and Public Affairs (1985), 14:3, 223-251; S. M. Amadae, Rationalizing Capitalist Democracy (Chicago: University of Chicago Press, 2003), 263-270.
73 See Don Ross, “Game Theory,” Stanford Encyclopedia ofPhilosophy, available online at http:// plato.stanford.edu/entries/game-theory/, 1997, revised 2014, accessed January 23, 2014.
74 Consider the canonical text of Mueller, Public Choice III, 2006.
75 See, e.g., the discussion of Daniel Kahneman and Amos Tversky’s presentation of the Allais Paradox, in Hargreaves Heap and Varoufakis, Game Theory, 2004, 16; see the standard discussion of the ultimatum game. Most work on bargaining readily presumes that utility can be stated in dollar terms; ibid., 162-163.
rather than complete the exchange.[413] Hardin observes that “Hobbes is perhaps the original discoverer of the fact that ordinary exchange relations are, in other words, a Prisoner’s Dilemma problem unless there is some coercive power to back them up.”[414] The extent to which a simplistic account of Hobbes’s argument for the social contract rests on the Prisoner’s Dilemma, in which agents seeks to take advantage of the other as their first choice, cannot be overemphasized.
Amartya Sen has argued that the expected utility maximizer is none other than a “rational fool.”[415] He observes that “economic theory has been much preoccupied with this rational fool decked in the glory of his one all-purpose preference ordering.”[416] This agent is incapable of solving Prisoner’s Dilemma predicaments, mainly because he lacks the ability to commit to an action independently of its calculable rewards.[417] Commitment cannot be captured in game theoretic expected utility functions ranking outcomes independent of the means by which they are achieved, yet following through on expressed intention is a feature of action many individuals not only relate to but also practice.[418] In short, members of civil society depend on commitment, in any of its expressions - including fair play, reciprocal respect of rights, political obligation, or side constraints - for their municipalities, states, and nationstate to function.[419] It represents a coherent rationale for action, and agents may choose whether or not to abide by its norms of conduct. Commitment, whether in the form of loyalty, rule following, or principled engagement, is the archetype of behavior that motivates acts independently of agents’ calculation of rewards.[420] Countering the neoliberal tendency to view all agents as individualistic expected utility maximizers and stipulating that only reward structures can maintain lawful conduct, Sen observes that “to run an organization entirely on incentives to personal gain is pretty much a hopeless task.”84 Daniel Hausman and Michael McPherson likewise acknowledge that teaching the rationality of cheating in the form of self-interested utility maximization consistent with Hobbes’s rational Foole endorses “a pernicious moral cynicism” and risks “becoming self-fulfilling prophesies.”85
The axioms of expected utility theory are artificial constructions.
The questions driving economic modeling, such as whether it is rational to free ride or whether rationality can condone cooperating in a Prisoner’s Dilemma game, have forgone conclusions derived from the analytic structure of the theory itself. It is crucial to understand, in Sen’s words, that the “nature of man in these current economic models continues, then, to reflect the particular formulation of certain general philosophical questions posed in the past” by economists and decision theorists.86 The rational actor model is a wholly abstract, mathematical concept of rationality that distills down to norms of internal consistency.87 It cannot be empirically falsified, and yet it presents endless room for posing questions and deriving answers.88 The Prisoner’s Dilemma and its structurally related cousins Newcomb’s Problem, and Toxin Puzzle are thought experiments derived from asking what would the rational agent, upholding the axioms of rational decision theory, do in these mathematically defined scenarios.89 Homo strategicus, the existential utility maximizer, provides a formal expression of Hobbes’s Foole. The exigencies of nuclear deterrence opened the door to relying on purely formal decision theory to provide guidance in pressing real world public policy choices. The application of game theory to concrete lived circumstances demands that only instrumentally relevant fungible, and hence intersubjectively quantifiable, aspects of experience register in what counts in agents’ choices.to the sovereign, this would either have the structure of John Rawls’s fair play or would introduce a set of considerations into decision making transcending those that register in establishing the equilibrium of a noncooperative game as the status quo point from which to settle on a bargain as John Nash suggests. On fair play, see John Rawls, “Justice as Fairness,” 1985; on an effort to augment orthodox game theories expected utility functions with a parallel decision rule, see Joseph Heath, Following the Rules: Practical Reasoning and Deontic Constraints (Cambridge, MA: MIT Press, 2011); see also Gerald Gaus, The Order of Public Reason: A Theory of Freedom and Morality in a Diverse and Bounded World (New York: Cambridge University Press, 2011).
84 Sen, “Rational Fools,” 335.
85 Hausman and McPherson, Economic Analysis, 2006, 74-75.
86 Sen, “Rational Fools,” 322.
87 Ibid.; see also Hargreaves Heap and Varoufakis, Game Theory, 2004, 8-14.
88 On the challenges of falsifying rational decision theory, see Sen, “Rational Fools,” 324-325.
89 See the edited collection by Richmond Campbell and Lanning Sowden, Paradoxes of Rationality and Cooperation: Prisoner's Dilemma and Newcomb's Problem (Vancouver: University of British Columbia Press, 1985); on the Toxin Puzzle, see Gregory S. Kavka, “The Toxin Puzzle,” Analysis (1983), 43:1, 33-36.
This rational actor is also the quintessential neoliberal agent. This agent cannot, in principle, keep agreements made without the threat of external sanctions. A neoliberal society, resting on the premise of rational action, must therefore look to a totalitarian surveillance state to achieve compliance with the law.[421] The society in which every individual is a strategic rational actor is one that relies on rational deterrence theory to mobilize credibility underlying the exercise of nuclear sovereignty.
The following points become clear:
1. Political scientists largely view the problem of anarchy in international relations among nation-states and among individuals without government challenge with a parallel structure.[422] Since the 1970s, rational choice theorists have used the Prisoner’s Dilemma to model anarchy in both contexts, in keeping with Thomas Schelling’s analysis of the nuclear security dilemma.
2. The broadly accepted neoliberal resolution of anarchy among individuals prior to government is the introduction of a sovereign state that enforces the rule of law by threatening sanctions on citizens who all alike prefer to make an exception for themselves rather than voluntarily participate in upholding the social contract.
3. Therefore, the neoliberal rationale for government is that it provides the necessary and sufficient means to maintain the rule of law; considerations of legitimacy, fair play, and commitment do not motivate actors.
4. This understanding of the achievement and maintenance of national sovereignty breaks away from early modern liberalism because even Thomas Hobbes rejected the idea that actors can have sufficient knowledge to make prudent choices in a state of nature, and that people’s motives are sufficiently organized to cohere as a consistent, well-ordered set of desires.
5. For Hobbes, value in the form of meaningful expectation arises from achieving civil society, and certainly not prior to security of personhood. Security is a threshold condition, rather than an unbounded set of interests or passions, to which people owe their highest consideration by seeking peace and, by implication, refraining from threatening other individuals and upholding agreements made to them.
6. By contrast, the neoliberal theory put into practice by accepting the subjective evaluation of action through the lens of noncooperative game theory first endorses individuals’ resort to harmful threats to others in violation of the intention to avoid injury to one another as the shared basis giving rise to civil society out of chaos, and second treats agreements as cheap talk without motivational significance. Hence, the world of noncooperative game theory views the achievement of social order in terms of equilibrium states, optimal or not, that arise independent of actors’ self-awareness of the role that hypothetical or actual consent plays in reinforcing their compliance with the rule of law because the canonical rational actor maximizes instrumental gain by lone disobedience when possible.
7. Of course, this rational fool is a straw person, a made-up artificial construction. However, insofar as game theory is taught as the gold standard of rational choice without a clear and significant discussion of its caveats, assumptions, and limitations, then neoliberal subjects will be forged on the template of noncooperative game theory by direct pedagogy, the need to negotiate neoliberal institutions, and the encounter with neoliberal agents.