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Research on the domestic politics of trade typically begins with a theory about who benefits from trade and who is harmed by it. The actors—for instance, firms, workers, or industries—who benefit from trade are expected to support liberalization while those who are harmed are expected to oppose liberalization. For individuals, exposure to globalization through the labor market—including the type of job, firm, or industry—is likely to be an important determinant of individuals’ preferences over policies governing the global economy. To understand the domestic politics of trade with respect to labor, therefore, it is important to ask two key questions. First, what explains the preferences of workers? Broadly, scholars can be divided between those that argue different economic factors (i.e., labor market consequences) explain attitudes toward free trade and those who argue that noneconomic factors (e.g., values, information) are the main drivers of attitudes. Empirical tests of these theories rely on survey data. Second, how do trade pressures influence elections and when do workers’ interests influence policy outcomes? Research on mass politics shows that workers’ interests with respect to trade shape not only support for incumbents in elections but also whether elected officials support free trade. Domestic institutions also play an important role in this process, with research suggesting that democracies and left-leaning governments implement trade policies that are more favorable to workers. Yet trade in the 21st century looks very different from trade 30 years ago. It no longer involves only (or even primarily) the exchange of final goods but also trade in intermediate goods and services. Trade is also closely linked to the production strategies of multinational firms, including offshoring. These fundamental changes in the nature of global economic activity have important implications for the how the interests of workers relate to those of their employers, and by extension the politics of trade. As a result, scholars are increasingly incorporating new models of trade into analysis of politics at the individual and aggregate levels.

Article

Rational choice theory builds from a very simple foundation. To wit: individuals are presumed to pursue goal-oriented behavior stemming from rational preferences. Rational choice theory benefits from the very precise formulations of its assumptions. Individual-level rationality is generally defined as having complete and transitive preferences. Both completeness and transitivity have precise, formal definitions. From complete and transitive preferences, one can develop utility function presentations reflecting those preferences. Utility functions have the advantage of establishing a measure and allowing one to assess attitudes toward risk. That is, utility functions can reflect risk acceptance, risk neutrality, or risk aversion. Although some rational choice theorists focus on individual-level decision making, most rational choice theorists consider the ways in which individuals’ decisions are aggregated into some sort of social outcome or social preference order. The aggregation of individuals’ preferences occurs in both social choice and game theoretic models. Arrow’s theorem is the best-known result in social choice theory. Arrow showed that the rationality of individuals’ preferences could not be readily preserved at the group level when those individuals’ preferences were aggregated. That is, individual-level rationality does not ensure group-level rationality. Put slightly differently, irrationality at the group level cannot impugn rationality at the individual level. Other examples highlighting the difficulty of aggregating individuals’ preferences into a collective outcome abound. For instance, game theoretic presentations of the collective action problem highlight how individually rational decisions can lead to suboptimal outcomes. Rational choice models have been used to model interactions in a wide array of political institutions. Rational choice models have been developed to tackle some of the most challenging concepts in the social sciences, even in areas long thought impenetrable to rational choice theorizing. For instance, concepts such as ideology or personal identification have typically been used as preestablished descriptors. In contrast to treating those concepts as extant descriptors, rational choice theorists have modeled the endogenous development of ideologies and personal identification. Given the complexity of social phenomena, the relative parsimony and the clarity of rational choice models can be particularly helpful. The usefulness of rational choice models stems from their parsimony and their applicability to a wide range of settings.