Law homework

Rational Choice and Categorical Reason

Author(s): Bruce Chapman

Source: University of Pennsylvania Law Review , Jan., 2003, Vol. 151, No. 3 (Jan., 2003), pp. 1169-1210

Published by: The University of Pennsylvania Law Review

Stable URL: https://www.jstor.org/stable/3312888

REFERENCES Linked references are available on JSTOR for this article: https://www.jstor.org/stable/3312888?seq=1&cid=pdf- reference#references_tab_contents You may need to log in to JSTOR to access the linked references.

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact [email protected]. Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at https://about.jstor.org/terms

The University of Pennsylvania Law Review is collaborating with JSTOR to digitize, preserve and extend access to University of Pennsylvania Law Review

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

RATIONAL CHOICE AND CATEGORICAL REASON

BRUCE CHAPMANt

I. RATIONALITY AS A NORMATIVE IDEAL

The theory of rational choice, as understood by most economists

and many other social scientists, has both a normative and a positive

content. Normatively, it points to what should be done maximally to

achieve some given end, and, while it might not prescribe any particu-

lar end, it points to what it is to have a consistent set of ends that are

capable of being so maximized. For example, if an agent had a set of

ends that gave rise to a cyclical ordering of available alternatives, that

is, if she preferred x to y, y to z, and z to x, it would not be possible for

her to choose any one of these alternatives without another of the al-

ternatives being preferred to it according to her own criteria for

choice. In other words, it would not be possible for her to satisfy

completely, or maximize, her own ends.'

Positively, the theory of rational choice is used to describe, ex-

plain, and predict human behavior. Agents are assumed generally to

behave in an internally consistent way that can be rationalized by the

theory of maximization.2 Thus, if an agent has already chosen alterna-

tive y over alternative z, and then chooses alternative x over alternative

y, the assumption, and prediction, will be that the agent will choose

alternative x over alternative z.

tFaculty of Law, University of Toronto. I am grateful to Jack Knetsch, Rahul Kumar, Arthur Ripstein, and all the participants at the University of Pennsylvania Law School Symposium on Preferences and Rational Choice for their helpful comments on an earlier draft. Research funding from the Social Sciences Research Council of Can- ada and from the Connaught Fund at the University of Toronto is also gratefully ac- knowledged.

For a good discussion of rational choice construed as maximization, and the

properties that are consequently required for the underlying preference relation, see AMARTYA K. SEN, COLLECTIVE CHOICE AND SOCIAL WELFARE 7-20 (1970).

See, e.g., Amartya Sen, The Formulation of Rational Choice, 84 AM. ECON. REV. PROC.

385, 385 (1994) (noting that rationality is assumed to mean acting to maximize a utility payoff); Amartya Sen, Maximization and the Act of Choice, 65 ECONOMETRICA 745, 746 (1997) (distinguishing "maximization," which only requires choosing an alternative that is not judged to be worse than any other, from "optimization," which, more strongly, requires choosing an alternative that is better than all others).

(1169)

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1170 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

Recently, the positive theory has come under attack from experi-

mental psychologists and economists.3 Their experimental results,

gathered together under the banner of behavioral analysis, show that

the maximizing model of rational choice often does not provide a very

accurate account of how agents actually choose. Moreover, the depar-

tures from the model appear systematic rather than random, suggest-

ing that something other than maximization is going on.

However, the general tenor of these studies is not to question the

normative ideal of maximization. Rather, the departures from the

standard account of rational choice are typically characterized, and

criticized, as failures to be rational. Agents are only human beings,

after all, and human beings are subject to the limitations that must,

inevitably and systematically, arise out of personal biases, limits on the

salience and availability of important information, and the distorting

effects of how a given problem is framed. Thus, real-world agents are

only, it is said, capable of a "bounded rationality," using "rules of

thumb" and various "heuristics" (sometimes helpful, sometimes not)

rather than the fully fledged maximizing rationality that is still largely

accepted as the ideal for rational choice.4

In this Article, I argue that for many decision-making problems,

the normative account of rationality that animates rational choice

theory, and notjust the positive account that is criticized by the behav-

iorists, is deficient, even as a theory of ideally rational behavior. Ra-

The literature is now huge. Good selections can be found in CHOICES, VALUES,

AND FRAMES (Daniel Kahneman & Amos Tversky eds., 2000); JUDGMENT UNDER

UNCERTAINTY: HEURISTICS AND BIASES (Daniel Kahneman et al. eds., 1982); RATIONAL

CHOICE: THE CONTRAST BETWEEN ECONOMICS AND PSYCHOLOGY (Robin M. Hogarth

& Melvin W. Reder eds., 2d ed. 1987). For a wide-ranging textbook treatment of many

of the relevant issues, seeJONATHAN BARON, THINKING AND DECIDING (3d ed. 2000).

This is quite clearly Jonathan Baron's view. See BARON, supra note 3, at 66 (not-

ing that, for one reason or another, people often fail to follow prescriptive models of

decision making and rationality). However, not all theorists of "bounded rationality" think of its "boundedness" as setting constraints on what, ideally, rationality would

otherwise require of us. As one pair of theorists wrote:

Bounded rationality is, however, not simply a discrepancy between human

reasoning and the laws of probability or some form of optimization. Bounded

rationality dispenses with the notion of optimization and, usually, with prob-

abilities and utilities as well. It provides an alternative to current norms, not an account that accepts current norms and studies when humans deviate from

these norms. Bounded rationality means rethinking the norms as well as

studying the actual behavior of minds and institutions.

Gerd Gigerenzer & Reinhard Selten, Rethinking Rationality, in BOUNDED RATIONALITY: THE ADAPTIVE TOOLBOX 1, 6 (Gerd Gigerenzer & Reinhard Selten eds., 2001). On

this view, bounded rationality provides an alternative account of ideally rational behav- ior.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CA TEGORICAL REASON 1171

tionality, I shall suggest, provides for an ordered particularity, including particular decisions, but the notion of an ordering that informs this

alternative account of ideally rational behavior, and which is more ap-

propriate in some decision-making contexts (including many legal

ones), is very different from the idea of an ordering that informs the standard account within rational choice theory. The latter, which, as

already suggested, is closely allied to the idea of maximization, remains

largely quantitative and single-minded in its orientation, this despite

the pluralism of motivations that it appears to be able and willing to

accommodate within its seemingly minimalist structure.5 The alterna-

tive account is more qualitative, or categorical (although not abso-

lute), offering a conception of a rational ordering of particularity that

is more allied to the idea of an understanding or interpretation (under 6

rules or principles) than it is to maximization. At the risk of import-

The structure of conventional rational choice is minimalist in the sense that it

only seems to require that an agent (1) be able to order any set of available alternatives from best to worst, and (2) not choose an alternative x from that set if there is another alternative that is better than (or more preferred to) x according to this ordering. (More structure is required for rational choice over uncertain alternatives, including, most importantly, the so-called "sure thing" principle. For a discussion of this princi-

ple, see infra note 35 and accompanying text.) Requirement (1) appears to be open to

any possible motivation or criterion for choice (including concerns for justice, altru- ism, respect for the environment, process values, etc.); requirement (2), while captur- ing the idea of maximization, seems to follow simply from taking these different moti-

vations or criteria seriously. Why settle on choosing some alternative if there is another alternative available that is better according to one's own criteria for choice? However, as I hope to demonstrate in this Article, there is already enough in this ap-

parently minimalist structure to prevent us from accommodating some attractive (non- maximizing) principles of choice as rational.

Compare the characterization of these two alternative accounts of rational deci-

sion making provided by Drazen Prelec: Decision analysis, which codifies the rational model, views choice as a fun-

damentally technical problem of choosing the course of action that maximizes a unidimensional criterion, such as value or utility. The primary mental activ-

ity ... is the reduction of multiple attributes or dimensions to a single one, through a specification of value trade-offs .... For rule-governed action, the fundamental decision problem is the quasi-legal one of constructing a satisfy-

ing interpretation of the choice situation. The primary mental activity in-

volved in this process is the exploration of analogies and distinctions between

the current situation, and other "canonical" choice situations in which a single rule or principle unambiguously applies.

Values and Principles: Some Limitations on Traditional Economic Analysis, in SOCIO-

ECONOMICS: TOWARD A NEW SYNTHESIS 131, 131 (Amitai Etzioni & Paul R. Lawrence

eds., 1991). For some suggestions about how the differences between maximization and reasoning by analogy might be captured in choice theoretic terms, see Bruce

Chapman, The Rational and the Reasonable: Social Choice Theory and Adjudication, 61 U. CHI. L. REv. 41 (1994).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1172 UNIVFRSITYOFPENNSYLVANIALAWREVIEW [Vol. 151: 1169

ing some unnecessary baggage, but for reasons that I hope will be-

come clearer as the argument unfolds, I refer to this alternative con-

ception of rationality as categorical reason. If that phrase suggests a

longstanding rationalist tradition, exemplified by Kant, but rejected

by the British empiricists like Hobbes and Hume, who are the most

likely intellectual ancestors of contemporary rational choice theorists,

that is not entirely unwelcome.7

The real challenge for this Article, however, is not so much to ar-

ticulate two alternative accounts of rationality that have had some tra-

ditional followers, but to begin to make each accessible to the other

within some common intellectual framework. While I think rational

choice theory provides a useful and precise set of tools for beginning

this process of achieving mutual understanding between the tradi-

tions, I shall argue that some quite fundamental postulates of rational

choice theory (including some of the axioms of choice consistency

and strong independence) will have to be relaxed if the contributions

of categorical reason are properly to be accommodated within it.

However, I hope to show that there is much advantage in this, even

for what the rational choice theorist hopes to achieve, and to illustrate

For a concise account of the intellectual origins of rational choice theory in the

works of Hobbes and Hume, see Martin Hollis & Robert Sugden, Rationality in Action,

102 MIND (n.s.) 1, 2-7 (1993). In interpretations of Kant, the word "categorical," as in

"categorical imperative," is often thought to mean "absolute" or "without qualifica- tion"; for an example of this interpretation, see CHARLES FRIED, RIGHT AND WRONG 9-

13 (1978). This is not the meaning of "categorical" I mean to suggest in my phrase

"categorical reason." See infra text following note 77 (discussing the concept of "cate- gorical reason"). Rather, I mean something more like "within categories" or "accord-

ing to rules," as in the following:

Everything in nature, both in the lifeless and in the living world, takes place according to rules, although we are not always acquainted with these rules .... The whole of nature in general is really nothing but a connection of appear-

ances according to rules; and there is no absence of rules anywhere. If we be-

lieve we have found such a thing, then in this case we can only say that we are not acquainted with the rules.

The exercise of our powers also takes place according to certain rules that we follow, unconscious of them at first, until we gradually arrive at cognition of them through experiments and lengthy use of our powers, indeed, until we finally become so familiar with them that it costs us much effort to think them in abstracto ....

Like all our powers, the understanding in particular is bound in its actions to

rules, which we can investigate. Indeed, the understanding is to be regarded in general as the source and the faculty for thinking rules in general. For ... the understanding is the faculty for thinking, i.e., for bringing the representa- tions of the senses under rules.

IMMANUEL KANT, LECTURES ON LOGIC 527 (J. Michael Young ed. & trans., Cambridge Univ. Press 1992) (1800).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1173

the point by reference to some systematic difficulties that the rational

choice theorist faces in the theory of social choice and game theory.

Part II reviews the results of some recent behavioral experiments

that suggest that agents respond to reasons in a way that is not always

consistent with some of the fundamental axioms of (value-based) ra-

tional choice. I look at choice involving certain and uncertain alter-

natives, and focus on the weak axiom of revealed preference in the

former and the sure thing principle in the latter. My claim is that

while some of the choices that some of these experimental subjects

make do seem problematic from a rational point of view, sensible sce-

narios can be constructed that make good sense of these systematic

violations of the rationality axioms.

In Part III, I argue that common law adjudication manifests the

same tension between reason-based choice and conventional (value-

based) rational choice that was shown in the experiments. However, I

argue that the common law idealizes reason-based choice, insisting

not only that a claimant be right, but that a claimant be right and ra-

tional-that is, right for the right reasons. I refer to this reason-based

ideal as categorical reason.

In Part IV, I suggest that the idea of categorical reason can be use-

ful both in the theory of social choice and in the theory of noncoop-

erative games. In social choice, categorical reason brings a kind of

conceptual discipline to the preferences that can be admitted into so-

cial choice, and this helps to avoid certain problems of instability and

collective irrationality. In the theory of games, categorical reason

publicly organizes the particularity of individual agents' choices so

that coordination and cooperation are more likely to occur.

II. RATIONAL CHOICE BEHAVIORISM AND REASON-BASED CHOICE

A. The Case of Certainty

One might have thought, or even hoped, that a theory of rational

choice would have informed us about how people think or deliberate

about their decisions, or about how their choices are explained orjus-

tified by reasons. That, typically, is how a legal theorist would under-

stand the obligation to offer an account of rational decision making.

At the end of their article on "reasons," for example, John Gardner

and Timothy Macklem conclude that rationality "is simply the capacity

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1174 UNIVERSITYOFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

and propensity to act (think, feel, etc.) only and always for undefeated reasons.,8

However, the agenda for developments in the economic theory of

rational choice has, apparently, been one of psychological reduction-

ism. The idea, which began with Vilfredo Pareto's replacement of

cardinal with ordinal utility as a motivation for choice in the early part

of the twentieth century,9 has been to rely less and less on any claims

about what might be going on in someone's head.'0 With the advent of revealed preference theory, as originally developed by Paul Samuel-

son in the 1930s, " the expunging of anything psychologically substan- tial that might explain a set of rational choices, like the maximization

of self-interest, utility, or, now, even preference, is more or less complete.

What matters for rationality is the consistency of externally observable be-

havior, not any particular subjective motivation." This reliance on what is objectively observable is typically thought to be "scientifically

more respectable"'13 than any attempt to speculate about, and model, private thoughts, motivations, or reasons.

Of course, the requirements of a rational consistency of observ- able choice are not unrelated to the requirements of a rational maxi-

mization of unobservable preference or utility. Indeed, the former,

while considered a fully autonomous subject matter for the scientific

and systematic study of choice, is still typically thought capable of be-

ing "rationalized" by the latter. Thus, Samuelson's Weak Axiom of Re-

vealed Preference ("WARP"), 14 which is still the central postulate of the new behaviorism in cases of choice over certain outcomes, has been

John Gardner & Timothy Macklem, Reasons, in THE OXFORD HANDBOOK OF

JURISPRUDENCE AND PHILOSOPHY OF LAw 440, 474 Jules Coleman & Scott Shapiro eds., 2002).

VILFREDO PARETO, MANUAL OF POLITICAL ECONOMY 103-209 (Ann S. Schwier &

Alfred N. Page eds., Ann S. Schwier trans., Augustus M. Kelley Publishers 1971) (1927).

10 For a discussion of the historical developments in the theory of utility as a moti- vation for rational choice, see MARK BLAUG, ECONOMIC THEORY IN RETROSPECT 343-53

(3d ed. Cambridge Univ. Press 1978) (1962).

P.A. Samuelson, A Note on the Pure Theory of Consumer's Behaviour, 5 ECONOMICA (n.s.) 61, 61-71 (1938).

12 See, e.g., J.R. HICKS, A REVISION OF DEMAND THEORY 6 (1956) ("[T]he econometric theory of demand does study human beings, but only as entities having certain patterns of market behaviour; it makes no claim, no pretence, to be able to see inside their heads.").

13 See I.M.D. Little, A Reformulation of the Theory of Consumer's Behaviour, 1 OXFORD ECON. PAPERS (n.s.) 90, 97 (1949) (noting that objective observation has been deemed "scientifically more respectable" because it allows explanation of behavior "without reference to anything other than" behavior).

14 Samuelson, supra note 11, at 62-70.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1175

shown to be logically implied by, and consistent with, what would be

chosen by a rational maximizer of preferences.'5 According to WARP, if an agent ever chooses an alternative x over alternative y from some

set of alternatives, then that agent should never (on pain of inconsis-

tency) choose alternative y over alternative x from any other set of

available alternatives.16

One is tempted to add "unless, of course, her preferences have

changed," but this would be to seek refuge in a preference-theoretic

explanation of a possible departure from what is supposed to be a

purely choice-theoretic requirement. Nevertheless, the temptation is

revealing in that it shows what really lies behind WARP as a plausible

requirement for rational choice. The idea, surely, is that an ideally ra-

tional agent can arrange all conceivable alternatives in order of prefer-

ence and would choose, from any available subset of those alternatives,

the one that was highest in that ordering. Such an agent would never

violate WARP. Further, an agent satisfying WARP would always

choose as if she had such a preference ordering and were maximizing

it.

At first glance this last claim might seem odd, since there does not

seem to be enough in WARP to generate the thought that there must

be an underlying transitive preference relation motivating choice. For

example, if an agent chose x from the choice set (x, y), y from the choice set (y, z), and z from the choice set (x, z), there would not yet

be any violation of WARP, although the choices do seem to reveal an

intransitive preference ordering, something that can frustrate maxi-

mization.17 However, the violation of WARP is manifest if we can re- quire that the agent now show us a consistent choice over the choice

set (x, y, z), that is, if we take seriously the idea that the agent must, in

a way analogous to the complete preference requirement, be consis-

tent in her choices over any conceivable set of available alternatives.

For, given her first three choices over the three different pairs, the

agent cannot now choose any alternative from the triple (x, y, z) with-

See Kenneth J. Arrow, Rational Choice Functions and Orderings, 26 ECONOMICA (n.s.) 121, 126 (1959) ("The most interesting conclusion is the complete equivalence of [WARP] with the existence of an ordering from which the choice function can be derived."); see also Amartya K Sen, Choice Functions and Revealed Preference, 38 REV. ECON. STUD. 307, 310-11 (1971) (proving the logical equivalence of WARP with choice under a rational preference relation).

16 Arrow, supra note 15, at 123.

See supra text accompanying note 1 (introducing the normative theory of ra- tional choice as maximization).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1176 UNIVERSITY OF PENNSYLVANIA LAWREVIEW [Vol. 151: 1169

out violating WARP.18 Thus, a rational maximizer of preferences will choose in a way that satisfies the behavioral requirements of WARP,

and an observable chooser satisfying the requirements of WARP will

choose as if she had a fully transitive preference ordering that she was

maximizing. It does not appear, therefore, that the behaviorist revo-

lution has offered up any real surprises at the level of principle.

Of course, where behaviorism has offered up something new is in

the recent experimental research that shows that agents do not actu-

ally choose in the way that the most minimal consistency conditions,

like WARP, seem to require. That is, the choice between two alterna-

tives x and y can vary-indeed, it can be reversed-according to what

else is in the available set of alternatives. To the extent that this ap-

pears to be systematic and predictable, it suggests that these choices

cannot be rationalized as the maximization of preference. It is a dif-

ferent question, perhaps, whether they can be rationalized at all.

The most interesting experimental results for the purposes of this

Article are those offered by Eldar Shafir, Itamar Simonson, and Amos

Tversky around the idea of "reason-based choice." 19 These authors begin by contrasting reason-based choice with value-based choice, the

latter being their name for the economic theory of rational choice.

On this latter view, a value is associated with each alternative and

choice is characterized as the maximization of value. Reason-based

choice, on the other hand, is more characteristic of legal scholarship's and analyses of historically significant case studies.2' It "identifies vari- ous reasons and arguments that are purported to enter into and in-

fluence decision, and explains choice in terms of the balance of rea-

sons for and against the various alternatives."22 This, they admit, is a somewhat vague characterization of rational choice, and it might not

be clear why there would necessarily be any incompatibility between

value- and reason-based choice. Surely the "values" of different alter-

18 See AmARTYA SEN, CHOICE, WELFARE AND MEASUREMENT 58 (1982) ("[N]o mat- ter what he chose out of this set of three alternatives . . . he must violate [WARP].").

19 Eldar Shafir et al., Reason-Based Choice, in CHOICES, VALUES, AND FRAMES, supra note 3, at 597, 597-619; see also Amos Tversky & Itamar Simonson, Context-Dependent Preferences, 39 MGMT. SCI. 1179, 1179 (1993) (discussing empirical findings inconsistent with value maximization and presenting a context-dependent model of choice).

Shafir et al., supra note 19, at 598; see also infra Part III (suggesting that common

law adjudication is a form of reason-based choice).

21 For example, reason-based choice analysis has been applied to a study of the Cuban Missile Crisis. GRAHAM T. ALLISON, ESSENCE OF DECISION: EXPLAINING THE

CUBAN MISSILE CRISIS (1971), cited in Shafir et al., supra note 19, at 598. 22 Id.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CA TEGORICAL REASON 1177

natives provide good reasons for choosing them, the argument might

go, and it seems natural to think that the balance of values would pro- vide a good indication of where the balance of reasons is ultimately to

be found. However, their precisely constructed experiments serve to

indicate more clearly what is meant by reason-based choice and why

the conflict with value-based choice can potentially arise.

The experiments show that agents will often latch onto a reason

for choosing a particular alternative just to resolve the conflict that

they feel in facing choice. The "irrationality," at least from a rational

choice perspective, is that almost any reason, including a seemingly

"irrelevant" one, will do. For example, some subjects were asked to choose between alternative x, six dollars in cash, and y, a high quality

pen.23 The pen was chosen by 36% of the subjects and the remaining 24

64% chose the cash. However, when the subjects were presented with a choice from these same two options together with a third, z,

another pen that was of clearly inferior quality to the first, then the

percentage of subjects that chose y, the higher quality pen, rose dra-

matically.25 This appears to suggest that many subjects who would choose x over y, when only those alternatives are available, will choose

y over x when some third alternative, z, is added to the set of available alternatives, a violation of WARP.

The explanation offered is that these subjects now have a reason to

choose y, namely, that it is a pen of clearly superior quality to z, a rea- son that they did not have when z was unavailable.26 However, this pat- tern of choices does appear somewhat "irrational." The fact that y is

an alternative that is obviously better than z provides a good reason

for choosing y over z, but it appears to provide little reason for choos- ing y over a quite different alternative x. Indeed, as nothing about the

values of x and y is changed by introducing z into the choice set, one

might have thought that nothing would change for a rational chooser

in a value-based choice between x and y. This property of "rational"

consistency is what is captured by WARP and what is violated so sys-

tematically by the experimental results.

Nevertheless, it is not difficult to construct a different scenario

where it seems more sensible to think that the addition of some alter-

native z might change the choice between alternatives x and y. Sup-

23 Id. at 609. 24 Id.

25 Id.

26 Id. at 610.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1178 UNTVERSITY OF PENNSYLVANIA LAWPREVIEW [Vol. 151: 1169

pose, for example, that someone is offered a choice of fruit at the end

of a dinner.27 If only a large apple, A, and a large orange, 0, are of- fered to her, she would choose the large apple. Both fruits are large

and, all else equal, she prefers apples to oranges. However, if she is

offered A, 0, and a small apple, a, then different considerations arise. For now there is an issue of etiquette to be addressed. The rule, let us

say, is that one should never choose the larger of two items of the

same kind. Our chooser now reasons that, in the choice from the set

(A, 0, a), she cannot now choose A, because that would be in breach

of the rule of etiquette. She therefore chooses 0, a piece of fruit that is larger than a, but a fruit of a different kind. Thus, from the set of

alternatives (A, 0), she chooses A; but from the set of alternatives (A,

0, a), she chooses 0, a violation of WARP.

The chooser would also reveal an intransitive preference ordering

if the different fruits were offered to her in pairs. She would choose A

from the pair (A, 0), 0 from the pair (0, a), and a from the pair (a, A), in violation of transitivity. The reason, of course, is that the rule of

etiquette does not come into play until the third choice, when the big

and small apples are presented together. Until that point the chooser

can select between the fruits purely according to taste, or according to

the different values of the different alternatives, choosing the highest

valued one; in other words, she can choose in the way that the theory

of value-based choice and maximization suggests. But when the two

apples are presented together, etiquette becomes an issue between

them, that is, as an issue bearing on the relationship between those two

alternatives, not as a property or value of either of the two alternatives

considered on its own. In this way we can say that the concern for eti-

quette, unlike the concern for taste, is a partition-dependent or categorical

idea; it arises only when the two alternatives, a and A, appear together

within some partition of the alternatives."

27 This example is now much discussed. The earliest published analysis of it of which I am aware is in Philip Pettit, Decision Theory and Folk Psychology, in FOUNDATIONS OF DECISION THEORY 147, 163 (Michael Bacharach & Susan Hurley eds., 1991). The example, and close variations of it, is also analyzed in Paul Anand, The Philosophy of In- transitive Preference, 103 ECON. J. 337, 344 (1993); Bruce Chapman, Law, Incommensura- bility, and Conceptually Sequenced Argument, 146 U. PA. L. REV. 1487, 1498-99, 1503-05 (1998); Amartya Sen, Internal Consistency of Choice, 61 ECONOMETRICA 495, 501 (1993). See also Amartya Sen. Is the Idea of Purely Internal Consistency of Choice Bizarre?, in WORLD, MIND, AND ETHICS: ESSAYS ON THE ETHICAL PHILOSOPHY OF BERNARD WILLIAMS 19, 24

(J.E.J. Altham & Ross Harrison eds., 1995) [hereinafter Sen, Bizarre] (showing the epis-

temic relevance of a different menu of alternatives).

For other examples used to make the same point, see JOHN BROOME, WEIGHING GOODS: EQUALITY, UNCERTAINTY, AND TIME 100-01 (1991); ISAAC LEVI, HARD

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CA TEGORICAL REASON 1179

The etiquette example provides, therefore, another instance of

reason-based choice pulling the chooser in a direction different from

that prescribed by the logic of value-based choice. The presence of a

in the set of alternatives gives our chooser a reason in etiquette for not

choosing A. But, just as for the experimental results referred to ear- lier, this is a reason that does not seem to be relevant to any compari-

son between A and 0; it is a very partition-dependent consideration.

The values of A and 0 as alternatives would appear to be unchanged,

and the choice between them, one might have thought, would be un-

affected by such an "irrelevant" reason.

Yet, despite this apparent "irrationality," what is happening in the

etiquette example is hardly incomprehensible to us, at least if we have

any sort of feel for the rule of etiquette that is involved. We simply

understand the choice situation (A, 0, a), where both A and a are pres-

ent and etiquette is at issue, differently from the choice situation (A, 0), where a is absent and etiquette is not at issue. And this different un-

derstanding, which turns on the availability of an alternative that is it-

self never chosen, requires that a different choice be made over those

two alternatives A and 0, which were always available for choice.

Thus, it is not as if the different understanding arises simply because a

different set of available alternatives means we can now choose some-

thing different, and more particularly something better, which was not

available earlier.29 That sort of different understanding, which does

CHOICES: DECISION MAKING UNDER UNRESOLVED CONFLICT 33, 105 (1986); James F. Reynolds & David C. Paris, The Concept of 'Choice' and Arrow s Theorem, 89 ETHICS 354, 363 (1979).

29 Not surprisingly, this is how the committed rational choice theorist typically solves the etiquette problem and others like it. See, e.g., BARON, supra note 3, at 235 (arguing that, because of the relevance of etiquette, a large apple does not mean the same thing when compared to a large orange as it does when compared to a small ap-

ple). What appears as an inconsistent choice over the same pair of alternatives is actu-

ally a choice over a different pair of alternatives and, therefore, the issue of inconsis- tency cannot arise. Choosing "the big apple A from a set where the little apple a is available" is simply not the same as choosing "the big apple A from a set where the lit- tle apple a is not available," or so the argument goes. We might even capture this idea

by more accurately relabeling the two alternatives for choice as A/a and Al-a, respec- tively (where A/a is read "A when a is also available" and Al-a is read "A when a is not also available"). Thus, the apparent inconsistency of choosing A from the set (A, 0) and 0 from the set (A, 0, a), for example, is resolved under this redescription of the problem as choosing A/-a from the set (A/-a, 0) and 0 from the set (A/a, 0, a), in perfect conformity with choice consistency conditions like WARP. This "solves" the difficulty, but only at the cost of rendering the choice consistency requirements vacu-

ous. As Sen observed, "[iff every time the set from which the choice is being made changes, the choice of any given alternative ... is taken to be a different choicej . .. then no condition of internal consistency of choices from different subsets can make

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1180 UNIVERSITY OFPENNSYLVANIA LAWRPEVIEW [Vol. 151: 1169

not affect our understanding of the previously available alternatives,

would always be relevant to a maximization of value. Rather, the dif-

ferent understanding arises because the addition of the new alterna-

tive changes how the previously available alternatives, themselves un-

changed, are now conceived. And this new understanding changes how

we choose between those previously available alternatives.30 Thus, this

any demand whatsoever." Sen, Bizarre, supra note 27, at 26. This is a heavy price to pay

to "secure" the conventional requirements of rationality in rational choice theory. Moreover, the very act of redescribing the alternatives according to what else is avail-

able in the choice set concedes the point at issue, viz., that what we are doing in choice,

and what we want to do under that description, varies with the set of available alterna-

tives. This variation is only obscured, and not preserved as a subject requiring more thorough analysis, if we simply provide a new set of partition-dependent descriptions of

the alternatives to preserve a partition-independent choice consistency condition. To his

credit, John Broome has at least recognized that the redescription strategy must be re-

fined so that something of the original force of the conventional rationality conditions

can be preserved without reducing them to the worst forms of "ad hocery." See

BROOME, supra note 28, at 102-07 (discussing the recognition of rational requirements of indifference as a way of dealing with the problem of emptiness). However,

Broome's refinement strategy, which allows alternatives to be "individuated" in the way

described earlier, either begs the question (in that rationally justified differences in

choice still have to be justified as differences between the alternatives separately con-

sidered) or generates a quite different problem for rational choice in that some alter-

natives cannot now logically be compared, something which violates the completeness

requirement. For a discussion of the relationship between completeness and rational-

ity, see infra text accompanying notes 80-81.

For an interesting paper relating the conventional choice consistency condi-

tions (like WARP) to the equally conventional monotonicity requirements of classical

logic, see RuVIN GEKKER, NONMONOTONIC REASONING AND THE FOUNDATIONS OF

RATIONAL CHOICE (European Pub. Choice Soc'y, Working Paper No. 61, 2002), avail-

able at http://www.economics.nuigalway.ie/downloads/papers/0061paper.pdf. Under monotonicity, if some proposition p is sufficient to imply another proposition q, then

the compound proposition p and r should also imply q; in other words, the sufficiency

of p for q should not be undermined by adding r. However, under non-monotonic or defeasible reasoning, this is precisely what is relaxed. While p on its own might be suf- ficient for q, the addition of proposition rcan imply not-q.

In the etiquette example, the non-monotonicity is found in the following: Let

proposition p be "options A and 0 are available for choice," let proposition q be "I should choose A and not 0," and let proposition rbe "option a is available for choice." Then, under the obligation to choose something according to the desire to eat (larger pieces of) fruit and the rules of etiquette, while p implies q, p and r implies not-q. (In fact p and r implies, "I should choose 0 and not A.")

It is arguable that much of legal reasoning and legal argument proceeds non-

monotonically. Certainly the desire to provide an adequate model of legal reasoning has been one of the great motivators for the development of non-monotonic or defea- sible logics in recent years. See, e.g., JAAP C. HAGE, REASONING WITH RULES: AN ESSAY

ON LEGAL REASONING AND ITS UNDERLYING LOGIC, at xiii (1997) (discussing defeasibil- ity of reasoning with rules, "in particular legal rules"). For example, the addition of a certain legal defense r, while not relevant or even admissible as a consideration until

the prima facie case p is in place (it is a defense after all), can reverse or defease the le-

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1181

is different choice under a truly different understanding of the (same)

alternatives (themselves unchanged in value); it is not different choice

simply because (trivially, we now understand that) differently valued

alternatives are now available. Where WARP allows the latter role for

an altered "understanding," it does not allow the former.

Yet the idea that we might choose differently over empirically in-

distinguishable alternatives because we have a different understanding

of the issues that are at stake in our choice is hardly novel. Consider

the example of how one chooses as a friend, something Aristotle dis-

cussed at some length.) It is widely appreciated that there is some-

thing problematic about choosing to be someone's friend for instru-

mental reasons, especially, say, if one is being a friend (or seeking the

good for one's friend) simply because it makes one better off. There

may be reciprocity or mutual "back scratching" in that, but it fails

fundamentally as friendship. The test (although not, of course, the

end) of true friendship is in the willingness to continue acting as a

friend even if doing so makes one worse off.

This much is elementary, but we can take the basic insight further.

A true friend cannot even have the value of having friends as the rea-

son she does what friends do. That is also too instrumental; it puts the

value of having friends before the friendship itself. Even if the actor

sees her conduct as perfecting friendship, or seeking (too much) to

do what it is that friends do, it would still be too calculating and too

(self-consciously) goal-oriented for genuine friendship. But suppose

she says, in response to some proposal, "That's not what friends do; I

cannot do that." Then the concept of friendship informs what she

does, although it does not guide what she does in the way that a goal

(e.g., the goal or value of achieving or maintaining friendship) might.

She acts under an understanding of what friendship is, even of what

friendship requires, but she does not, strictly, act that way because

friendship requires it. The latter suggests too much that there is a

gal outcome q that would otherwise be implied by p. I have argued elsewhere that de-

feasible rules provide an innovative, rational, and peculiarly legal structure for the ac-

commodation of plural values in collective decision making, and one that cannot be

captured within the conventions of rational choice theory. Bruce Chapman, Law

Games: Defeasible Rules and Revisable Rationality, 17 LAW & PHIL. 443, 446 (1998);

Chapman, supra note 27, at 1494-95; see alsoJohn L. Pollock, A Theory of Moral Reason- ing, 96 ETHICs 506, 512-20 (1986) (arguing that defeasibility should provide the logical structure for moral reasoning more generally).

31 Aristotle devotes two books of The Nicomachean Ethics to friendship. SeeJohn M. Cooper, Aristotle on Friendship, in EssAYs ON ARISTOTLE'S ETHICS 301, 301-40 (Amelie

Oksenberg Rorty ed., 1980) (discussing Aristotle's writings on friendship).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1182 UNIVERSI7'Y OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

moment when she can understand the alternatives for choice inde-

pendent of the concept of friendship, and then go on to choose

amongst them as friendship, now brought to bear upon the choice,

would have her do. But the concept or category of friendship in-

forms, and orders, the particularity of her choices in a more gapless or

immediate way. She sees the choice as directly implicating friendship,

as a particular immediately implicates the category of which it is an in-

stance. And she chooses as a friend, with the result that, just as imme-

diately, she instantiates the category in the particularity of what she

does. In this way, the concept of friendship can be the reason for, or

the ordering of, her acting the way she does, even if the value of

friendship cannot.

This is not to say that there is no value to be achieved in friend-

ship or that friendship does not connect to something valuable. If

everyone acts under the aspect of friendship, where friendship ration-

ally orders or gives reason to what they do, then the good of friend-

ship is likely to be achieved and enjoyed. And there is value in that.

But still, it seems quite plausible to say that the value of friendship is

no part of our rationale for acting as friends. We act one way rather

than another simply because we know what it is to be friends. The

value we achieve is merely an incidental by-product, maybe even an

essentially incidental by-product,32 of our acting on this knowledge and for this reason.

This digression into the notion of friendship has served to illus-

trate that there is a long and durable tradition in the idea that an un-

derstanding, or a concept, can act as a reason for choice. This tradi-

tion also suggests that there is a difference between reason based on

such a concept and reason based on value. The importance of the

etiquette example is that it shows precisely where this difference is to

be found within the axioms of rational choice theory. Where a differ-

ent concept gives rise to a different understanding of the alternatives

available for choice, even a different understanding of all those alter-

natives that continue to be available as other alternatives change, then

choice may vary according to that changing understanding, even for

2 For a discussion of social states that are "essentially by-products," that is, states that "can only come about as the by-product[s] of actions undertaken for other ends,"

see JON ELSTER, SOUR GRAPES: STUDIES IN THE SUBVERSION OF RATIONALITY 43

(1983). See also Robert Sugden, Rational Choice: A Survey of Contributions from Economics and Philosophy, 101 ECON. J. 751, 781 (1991) (linking Elster's idea to problems of self- defeating rationality in the theory of rational choice and, in particular, the problem of

rational commitment).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CA TEGORICAL REASON 1183

those alternatives that continue to be available. While this might trouble

the rational choice theorist committed to certain choice consistency

conditions like WARP, conditions that make sense on a view of ra-

tional choice that is value-maximizing and goal-oriented, it is less clear

that such variations should surprise those whose conception of ra-

tional choice is to be found more in the idea that particular decisions

are rational to the extent that they can be ordered, or organized, un-

der the aspect of different concepts, understandings, or categories of

thought.

B. The Case of Uncertainty

The discussion so far has related to choice over certain alterna-

tives. We have been questioning whether the idea of maximizing

one's preferences (or values) over those alternatives, even if that only

takes its behaviorist form as a choice consistency condition like WARP,

is the only sensible conception of rational choice, or whether an al-

ternative conception, sensitive to the different understandings that a

chooser might bring to a choice problem, might also provide an ac-

count of rational ordering of particular decisions.

However, the most general theory of rational choice, which pur-

ports to rationalize behavior as expected utility maximization, deals with

choice over risky alternatives.33 Of course, to handle the more general

case, some further choice axioms are required. In this Section, we will

focus on one in particular, namely, the strong independence assump-

tion or "sure thing principle."34

The sure thing principle has been characterized as "[t]he key

qualitative property that gives rise to expected utility theory,"35 and so

Within this more general theory, certain choice is interpreted as the trivial case where the probabilities for the different possible outcomes are reduced to either one

or zero.

34 For a discussion of the axioms underlying expected utility maximization (or the idea that an agent's observable choices over uncertain alternatives can be rationalized,

or represented, as the maximization of that agent's expectation of utility), see R.

DUNCAN LUCE & HowARD RAIFFA, GAMES AND DECISIONS 23-31 (1957). Luce and

Raiffa refer to the strong independence assumption as "substitutibility." Id. at 27. For a discussion of the possible origins of the name "sure thing principle," see LEONARDJ. SAVAGE, THE FOUNDATIONS OF STATISTICS 21-24 (1972). "Strong independence" is the

name that Paul Samuelson uses for the axiom. See Paul A. Samuelson, Probability, Util-

ity, and the Independence Axiom, 20 ECONOMETRICA 670, 670 (1952) (asserting that strong independence conditions "create the existence of certain special or canonical indexes of utility and probability that are additive").

Amos Tversky & Daniel Kahneman, Rational Choice and the Framing of Decisions, in

CHOICES, VALUES, AND FRAMES, supra note 3, at 209, 210.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1184 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

it is important to have a sense of what it means. Roughly, the princi-

ple allows the chooser to cancel or eliminate from her consideration

any possible state of the world that yields the same outcome (the "sure

thing") regardless of one's choice. Suppose, for example, that one

can choose between two lotteries, A and B, where A provides for a sea- side vacation if one draws (from 100 possible numbered tickets) a

number between 1 and 10 and $100 for any number between 11 and

100, and B offers a mountain vacation on the chance that you draw a

number between 1 and 10 and $100 for any number between 11 and

100. Since all the possible draws of numbers between 11 and 100 yield

the same outcome of $100, the sure thing principle tells us that the

choice between the lotteries should turn only on the chooser's prefer-

ence between the possibilities of vacationing at the seaside or in the

mountains.

Suppose that the chooser indicates a preference for lottery A over

lottery B, indicating a preference for the seaside vacation. Now con-

sider a third lottery, C, which offers a seaside vacation if one draws a

number between 1 and 10 and $200 if one draws a number between

11 and 100. By the same sure thing principle, the choice between lot-

tery C and lottery A should turn on the chooser's preference between

$200 and $100. Suppose, as seems reasonable, that the chooser pre-

fers lottery C because, all other (vacation) possibilities equal, it offers

(the same chance of) a larger cash award. Thus, C is preferred to A, A

is preferred to B, and, by transitivity, C is preferred to B. And surely

this last implication (based on transitivity) makes sense even on a di-

rect application of the sure thing principle. If lottery C is preferred to

lottery B in every possible world that might occur (i.e., because of the

preference for a seaside vacation over a mountain vacation if a num-

ber between 1 and 10 is chosen, and because of the preference for

more cash rather than less in the event that a number between 11 and

100 is chosen), then lottery C should be preferred to lottery B even

when the exact state of the world (or which number might be chosen)

is still unknown. If this were not the case, that is, if lottery B were pre-

ferred to lottery C, then there would have to be something attractive

in the lottery as such, that is, in the particular combination of (mutually

exclusive) possibilities that B offers, namely, a less preferred vacation

and less cash, which allows lottery B to be more attractive for the

chooser even though each possibility considered on its own is dis-

preferred. This would, of course, violate the strong independence prop-

erties of the sure thing principle.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1185

However, despite the apparent rationality of the sure thing prin-

ciple, behavioral research indicates that it is systematically violated by

experimental subjects. The subjects appear to reveal what the behav-

iorists have called a "disjunction effect."36 That is, the subjects will in-

dicate a preference for some choice x over another choice y when they

know that event A obtains, and they will also indicate this same pref-

erence when they know that event A does not obtain, but they will in-

dicate a preference for y over x when it is unknown whether or not A

obtains. This is a violation of the sure thing principle. What is most

interesting about this research is the explanation for why this disjunc-

tion effect occurs. As we shall now see, the explanation again points

to the importance of reason-based choice.

In one of these experiments, all the student subjects were asked to

imagine that they had just taken a very difficult qualifying examina-

tion near the end of the fall term.37 Some of these students were then

asked whether they would take advantage of a very attractive holiday 38

package in Hawaii if they knew they had passed the exam. Others

were asked whether they would take advantage of the same package if

they knew they had failed the exam.39 A majority of the students indi-

cated that they would choose the vacation package in each of these

two possible states of the world.40 However, when the students were asked if they would choose the package if they did not know whether

they had passed or failed, less than a third of the students chose the

package and more than 60% were willing to pay five dollars to post-

pone the decision until the following day when they would know the

results of the examination.41 The fact that students (i) are unwilling to commit to the vacation when there are still two uncertain possibilities

before them, namely, pass or fail the examination, but (ii) will choose

the vacation in the event that either one of these two possibilities be-

comes a certainty, illustrates the disjunction effect and violates the

sure thing principle.

36 See, e.g., Shafir et al., supra note 19, at 612-13 ("Evidently, a disjunction of differ- ent reasons (reward in case of success or consolation in case of failure) is often less compelling than either definite reason alone."); Eldar Shafir & Amos Tversky, Thinking Through Uncertainty: Nonconsequential Reasoning and Choice, 24 COGNITIVE PSYCHOL. 449, 449 (1992) (explaining that "[u]ncertain situations may be thought of as disjunctions of possible states").

3 Shafir et al., supra note 19, at 611. 38 Id. at612. 39 Id.

40 Id.

4 Id. at611.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1186 UN!VERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

The explanation that is offered for this behavior concerns the rea-

sons that the students give for wanting to go on the vacation in each of

the possible states of the world. When the student knows that she has

passed the exam, she reasons that the vacation is ajust reward for her

success; when the student fails, she construes the vacation as providing

some kind of consolation. Thus, whatever the outcome of the exami-

nation, the student has a good reason-albeit a different reason for each possible outcome-to take the vacation. However, when the

outcome of the examination is unknown, the student lacks either one

of these as "a definite reason"42 for taking the vacation. Thus, under this last scenario, it is as if she knows it is right for her to go on vaca-

tion, but not that it is right for any particular reason. This, somehow,

makes it hard for her to go.

We could also interpret her difficulty in the following way: when

she knows the outcome of the examination, she knows the reason that

is relevant to her choice and, therefore, she knows exactly what it is

that she is doing when she goes on vacation. When she knows she has

passed, for example, she knows that this is a "reward trip." Likewise,

when she knows that she has failed, she knows that this is a "consola-

tion trip." In other words, she can organize what she is doing under

some kind of category or understanding. But when she does not

know the results of the examination, it is as if her vacation lacks any

such identity, or meaning, for her. Again, it is as if she knows what

she should do (after all, she knows that she has no reason to do oth-

erwise), but she lacks any particular understanding of what it is that

she is doing when she does it. To the extent that such an understand-

ing might bring order, or rationality, to the particularity of what she

does, her reluctance to go, far from manifesting irrationality (as sug-

gested by the violation of the sure thing principle), evidences the im-

portance of this alternative conception of rationality for her behavior.

Indeed, without this alternative rationality to bring order to what she

does, she will pay five dollars to wait the one day so that she will know

what it is that she is doing. And she will do this despite the fact that

waiting the extra day will not change what she will do.

The vacation example suggests the importance for choice of hav-

ing an understanding of what it is that one is doing, as opposed to

having no such understanding at all (or, at least, an ambiguous or

equivocal understanding because of uncertainty). However, other ex-

periments reveal that the presence of uncertainty, giving rise to a dis-

42 Id. at 612.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1187

junction effect, can generate, more positively, an alternative under-

standing to that arising from choice under certainty and, therefore,

give rise to choices that violate the sure thing principle because there

is this different understanding informing choice. Consider, for ex-

ample, what Eldar Shafir and Amos Tversky unearthed about how sub- 43

jects play the familiar two person prisoner's dilemma game. In their

experiment the rate of cooperation in the game was 3% when the sub-

jects knew that the other player had defected, and 16% when they

knew that the other player had cooperated.44 Now one might well

have expected some rate of cooperation between 3% and 16% when

the subjects were uncertain whether the other player had cooperated

or not. However, when the subjects were confronted with this uncer-

tain situation, the rate of cooperation rose significantly to 37%,45 a

number that cannot be explained as some weighted average between

the strategy "cooperate when the other cooperates" and the strategy

"do not cooperate when the other does not."

Shafir and Tversky attribute this pattern of responses, a pattern

that shows the disjunction effect and violates the sure thing principle,

to the different understandings that a subject will have of her choice

situation depending on whether she knows if the other player has al- 46

ready made his choice of strategy. When she knows that the other

player has already chosen his strategy, whether it be to cooperate or

not to cooperate, the subject thinks of herself as acting "on her own."47

Given the choice of the other player, she alone will determine the final

outcome of the game. This encourages her to bring a highly indi-

vidualistic perspective to bear on her choice of strategy, a perspective

that leads her more naturally to choose against cooperation. How-

ever, in the disjunctive or uncertain situation, all four possible cells of

the prisoner's dilemma game are still very much in play, with the out-

come of the game still to be determined by a combination of the

strategy choices of both players taken together. Shafir and Tversky

argue that this provides for a more collective understanding of the

situation, and from this more collective point of view the optimal

3 Shafir & Tversky, supra note 36, at 452-59. Id. at 454-55. The higher rate of cooperation in the latter situation provides

some support for the idea that players will sometimes reciprocate cooperation from

the other player rather than always choose the dominant noncooperation strategy that

rational choice theory typically prescribes.

4 Id. at 455. Id. at 457.

47 Id.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1188 UN!VERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151:1169

strategy for both parties is to cooperate.48 Thus, it is less surprising

that cooperation is chosen more frequently in this situation, say Shafir

and Tversky, the sure thing principle notwithstanding.49

It is worth emphasizing, again, that these differences in under-

standing that the subject brings to her choice situation cannot be ex-

plained on the basis of some variation in the properties or values of

any one (or more) of the alternative outcomes considered each on

their own. Nor are they to be explained by variations in properties or

values of the outcomes as weighted by the probability of their occur-

rence. Rather, the differences in understanding arise because the

same alternatives are somehow "differently conceived" depending on

what else is available, something that goes to a relationship that exists

between alternatives in the set of possibilities. For example, in the dis-

junctive case of the prisoner's dilemma, the presence of all four cells

together as possible outcomes of the game helps to frame any one of

them as instances of the "still-to-be-collectively-determined" category.

On the other hand, when only two cells within a given column of the

game are available (indicating that the other player has already cho-

sen his strategy), the two possible outcomes become instances of the

"it's-all-up-to-me" category. The idea that there could be a relation-

ship between alternative outcomes, related as instances of a particu-

larly conceived category of possibilities, and that this could influence an

individual's choice of a strategy producing those outcomes, is an idea

that the independence properties in the sure thing principle are set to 50

deny.

48 Id.

Id. at 457-58. Someone might object that there is a better explanation for the subjects' tendency to choose "less rationally" (in the sense that rational choice would require that the subject choose the dominant noncooperative strategy) in the case

where the four possible cells of the prisoner's dilemma are still in play. The argument might be that choosing over four cells is a more complex choice than choosing over

two cells, and that it should not be surprising that subjects do less well, or less "ration- ally," in the more complex case. However, Rachel Croson has experimental results that show this cannot be the explanation; it appears that the disjunction effect disap- pears in games that are equally complex but which do not have the same scope for dif-

ferent reasons. See Rachel T.A. Croson, The Disjunction Effect and Reason-Based Choice in Games, 80 ORG'L BEHAV. & HUM. DECISION PROCESSES 118, 129-31 (1999) (testing an alternative theory of decision making, complexity, as an explanation of the disjunction effect). Thus, Croson concludes that the explanation for the effect is reason-based, not complexity-based. Id. at 131.

The famous Allais paradox can be thought of in the same way. Maurice Allais, The Foundations of a Positive Theory of Choice Involving Risk and a Criticism of the Postulates and Axioms of the American School, in EXPECTED UTILITY HYPOTHESES AND THE ALLAIS PARADOX 27 (Maurice Allais & Ole Hagen eds., 1979). Allais argued that agents often

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1189

III. REASON-BASED CHOICE AND THE LAW

The common law is more than a mere collection of authoritative

resolutions for disputes. In addition to providing a decision, common

law judges are typically expected to articulate a set of publicly com-

prehensible reasons in support of the decision. Indeed, the obliga-

tion to provide reasons for one's choices may well be the one thing

that effectively distinguishes the common law as a method of collective

decision making. In market or political forms of decision making, for

example, individual rights holders and legislators can make perfectly

authoritative decisions without good reason." But, in the common law, the reasons that are publicly articulated in support of some deci-

sion form a large part of the authoritative basis for it. Weak reasoning

will undermine the authority of a case and leave it exposed to the in-

dignity of being distinguished into oblivion, if not completely over-

turned or reversed.

This suggests that common law adjudication is very self-

consciously a form of reason-based choice. It remains to be seen,

however, whether we can find the same tension in law between reason-

based choice and value-based choice that we saw above in the behav-

iorists' experiments. In this Part, I will argue that the same tension

does exist, and that it is often properly resolved in favor of legal rea-

sons that, for groups of judges, can be sensibly organized under par-

ticular categories of understanding, the sort of thing that explained

the behavior of the experimental subjects discussed earlier. This ra-

tional ordering of particular decision making is something I call cate-

gorical reason.

will have a "certainty preference" that cannot be allowed for if the strong independ- ence condition, or sure thing principle, of expected utility theory is assumed. The cer- tainty of getting some given payoff in every possible state of nature is not a property of any one state of nature. Rather, it is a property of, or a property of how we think of, all the (mutually exclusive) alternative states taken as a whole, that is, a property of their relationship. Moreover, because the alternative states are mutually exclusive possibili- ties, their relationship cannot be causal, only conceptual.

I do not mean to suggest that the passage of legislation is never informed by reasoned debate. Indeed, for the "republican" theory of politics, this sort of delibera- tive exchange is often thought to be central and important for grounding the authority of political decision making in general. I only mean to argue that the authority of any given legislative act is, ultimately, a matter of its proper positing by some legitimate lawmaker (e.g., a majority of the legislators). It is not affected by the possibility that, after reasoned debate, the particular reasons that prevailed were not especially good.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1190 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

To see the connection between law and reason-based choice as

understood by the behaviorists, consider the following example:" Suppose that a plaintiff was injured while using some product and that

she has advanced two separate and independent claims for the recov-

ery of damages from the defendant manufacturer. The plaintiff has

argued that the product was either defectively manufactured (D) or

sold with an inadequate warning (W), where either of these two argu-

ments would be sufficient, if successful, to win a judgment (J) for the

damages in question. In symbols, (D or W)--J. Now suppose that a

panel of three judges has considered the various arguments and that

each judge has come out on the issues in the following way. Judge A

The example is an instance, in disjunctive form, of what Lewis Kornhauser and

Lawrence Sager originally called "the doctrinal paradox." Lewis A. Kornhauser & Law-

rence G. Sager, The One and the Many: Adjudication in Collegial Courts, 81 CAL. L. REV. 1, 3, 57 (1993); see also Lewis A. Kornhauser & Lawrence G. Sager, Unpacking the Court, 96 YALE L.J. 82, 114-15 (1986) (illustrating the problem of the doctrinal paradox); Lewis

A. Kornhauser & Lawrence G. Sager, Group Choice in Paradoxical Cases 2 (Nov. 26,

2001) [hereinafter Kornhauser & Sager, Group Choice] (unpublished manuscript, on file with author) (defining paradoxical cases as those "where a group's consensus on

underlying premises diverges from that group's consensus on the ultimate outcome"). For other discussions of the doctrinal paradox, including analyses that link it to more

general problems in the theory of social choice and the theory of games, see Geoffrey Brennan, Collective Coherence?, 21 INT'L REV. L. & ECON. 197, 200-01 (2001) (examining the doctrinal paradox and illustrating how justice may conflict with doctrine); Bruce Chapman, More Easily Done Than Said: Rules, Reasons and Rational Social Choice, 18 OXFORD J. LEGAL STUD. 293, 312-18 (1998) [hereinafter Chapman, More Easily Done] (analyzing reasons, legal issues, and structure-based equilibrium); Bruce Chapman, Rational Aggregation, 1 POL., PHIL. & ECON. 337, 341-50 (2002) [hereinafter Chapman, RationalAggregation] (arguing that the aggregation of reasoned individual judgments is less subject to paradox than the aggregation of individual preferences); Bruce Chapman, Ra- tionally Transparent Social Interactions, in COGNITION, RATIONALITY, AND INSTITUTIONS 189, 197-98 (Manfred E. Streit et al. eds., 2000) (using a legal example to illustrate the point that some strategic interactions are transparent simply because they are more rationally comprehensible); Christian List & Philip Pettit, Aggregating Sets ofJudgments: An Impossi- bility Result, 18 ECON. & PHIL. 89, 96-100 (2002) (proving a general impossibility theo- rem for the aggregation of individual judgments); Christian List & Philip Pettit, Aggre- gating Sets of Judgments: Two Impossibility Results Compared, SYNTHESE (forthcoming 2003) (manuscript at 10-12, on file with author) (comparing Arrow's impossibility theorem with their own impossibility result), available at http://socpol.anu.edu.au/ pdf-files/W20.pdf; Philip Pettit, Deliberative Democracy and the Discursive Dilemma, in SOCIAL, POLITICAL, AND LEGAL PHILOSOPHY 268, 274-76 (Philosophical Issues vol. 11, Ernest Sosa & Enrique Villanueva eds., 2001); Philip Pettit, Groups with Minds of Their Own 1-4 (Apr. 2001) (unpublished manuscript, on file with author) (discussing the doctrinal paradox in the context of purposive groups more generally), available at http://socpol.anu.edu.au/pdf-files/W12.pdf. Saul Levmore used the specific example in the text, involving two different causes of action, to make a quite different point about the conjunction of probabilities. See Saul Levmore, Conjunction and Aggregation, 99 MICH. L. REv. 723, 729 n. 1 (2001) (identifying a "reverse conjunction" problem in the context of the product rule combining independent probabilities).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1191

believes that there is no reason for thinking that the product was

defectively manufactured. Thus, she believes argument D to be false.

But she thinks argument W is true; in other words, she thinks that, al-

though the product has not been defectively manufactured, there is

some risk and the consumer has been inadequately warned. She

would find reason forJ on the basis of W Judge B, on the other hand, believes that, while adequate information has been provided and,

therefore, that argument W is false, the product has, nevertheless,

been defectively manufactured and, therefore, that argument D is

true. Thus, she too would find in favor of J. albeit for a reason differ- ent fromJudge A. Finally,Judge C rejects both arguments D and Was

false and, therefore, also rejects J as false. The views of the three dif-

ferentjudges are presented in summary form in Table 1.

Table 1

1. There should 2. There should b3 There rson beJ for reason D. beJ for reason W. D or W

Judge A False True True

Judge B True False True

Judge C False False False

Majority False False True

Where:

J is the proposition, "The plaintiff wins ajudgment for damages."

D is the proposition, "The product was defectively manufactured."

W is the proposition, "There was an inadequate warning of product

risks."

And: (DorW)-JJ

It should be apparent that, at the group level, there is something

odd going on here. A majority of the court rejects proposition 1,

"There should be J for reason D," as false. Further, a majority of the

court also rejects proposition 2, "There should be J for reason W," as

false. Yet, a majority of the court accepts the disjunctive proposition

3, "There should be J for reason D or W," as true. There is something

collectively irrational in this combination of votes. At the group level,

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1192 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

it looks like we have generated a disjunction effect similar to what we

observed earlier in the behaviorist experiments.

The collective irrationality would become particularly apparent if

the majority of judges who support an outcome favoring the plaintiff,

A and B, had to articulate a set of publicly comprehensible reasons in

support of their decision. There are, after all, only two possible ar-

guments that the plaintiff can make in this case to win a reward for

damages J. Yet, on each of these essential arguments, the two judges

who form a majority in favor of the plaintiff have completely opposing

views (as indicated by columns 1 and 2). They would, therefore, have

some difficulty saying together what it is that they want to do together.

The two judges may share a common preference, or predisposition,

for the outcome favoring the plaintiff, but it is not at all clear that they

have a shared understanding of what it is that they are doing to reach

that outcome.53 It is as if what they want to do together lacks any real

categorical identity. Nor is the problem merely that there is a plurality

of reasons here, with no particular reason commanding majority sup-

port. There are majority views on each of the relevant reasons and they are that neither D nor W is a good reason for the plaintiff to pre-

vail in this action.

Now one might ask whether this lack of any common understand-

ing of, or reason for, a shared preference for a particular legal out-

come must translate into any practical difficulty for the majority actu-

ally to act on its preference, that is, whether the failure to be able to articulate a common sense of what it is that one is doing should im-

pact at all on the possibility of rational choice.54 In some strictly causal

Of course, each judge has a reason for what she wants to do. To that extent, the position of each judge is reasoned and not merely a matter of preference or predispo- sition. But as these reasons are not shared between the judges, what is shared, not be- ing supported by reason, looks more like a brute preference or predisposition.

5 If the different members of a majority are voting in favor of a given outcome, but each for different reasons, then in an important sense they are not actually voting on the same proposition. For example, in Table 1, column 3, while it appears that Judges A and B agree in their voting, Judge A is actually voting for the proposition 'j for reason W," whereas Judge B is voting for the proposition 'j for reason D." This se- verely complicates the epistemic support that majority voting gives to a given proposi- tion by way of Condorcet's famous jury theorem. Condorcet's theorem shows that if each member of a group of voters is more likely to be right than wrong about some given proposition (and this probability of being right is more or less equal for each voter), then a majority of such voters is even more likely to be right than wrong about that proposition than is any of the voters alone. MARQUIS DE CONDORCET, ESSAY ON THE APPLICATION OF MATHEMATICS TO THE THEORY OF DECISION-MAKING (Paris, L'imprimerie Royale 1785), reprinted in CONDORCET: SELECTED WRITINGS 33, 48-49 (Keith Michael Baker ed., 1976); see Bernard Grofman et al., Thirteen Theorems in Search

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1193

sense, of course, there cannot be any such impact. It is always possible

to pursue one's preferences without good reasons, and possible for a

majority to pursue its preferences without any coherent reason across

its members. The preferred alternative is not less available as an op-

portunity for choice simply because the majority cannot organize its

thinking in favor of that preferred result under a single (coherent) set

of concepts or categories of thought. Thus, at first glance there is lit-

tle in this legal example, perhaps, that provides any reason for think-

ing that there is some necessary connection between what we can say

or think (together) and what we can do (together). The conventions

of rational choice theory, therefore, which emphasize (as WARP does)

consistency of choice over the consistent availability of unchanging al-

ternatives, seem not to be much affected, although one might have

hoped that the idea that one can pursue one's preferences without

good reasons would give a rational decision theorist some reason to

pause.

However, the experimental results provided by the behaviorists55

do suggest that subjects will have some difficulty making a choice (or

making the same choice) if they cannot organize what they want to do

under a set of particular (or the same set of particular) reasons. Thus,

this literature supports the idea that there can be a genuine tension

between what we want to do and what we have reason to do, and that

this tension is often resolved, as a matter of fact, in favor of reason.

Further, it seems that our legal practices might provide some

normative support for resolving the tension in this way. For suppose

the plaintiff in the Table 1 example were to argue that she should win

a judgmentJ because there appears to be a majority agreement in fa-

vor of this outcome in column 3. In other words, she points simply

and bluntly to the fact that a majority of the judges thinks that she

should win, albeit for different reasons. A lawyer is tempted to reply, I

think, that the plaintiff's appeal to the column 3 agreement is inade-

of the Truth, 15 THEORY & DECISION 261, 264-65 (1983) (formalizing and extending

Condorcet's original jury theorem). The theorem provides some reason for using ma- jority voting in legal decision making to get at matters that have a correct legal answer, or are questions of judgment rather than preference, but it is crucial for the applica- tion of the theorem that the relevant majorities have voted for the same, or at least not inconsistent, propositions. Thus, in the context of the doctrinal paradox, this means

that the Condorcet theorem may provide more epistemic support for the majority votes down columns 1 and 2 than it does for the majority vote down column 3. For further discussion of the relevance of the doctrinal paradox to the application of the

Condorcet theorem, see Chapman, Rational Aggregation, supra note 52, at 341-44.

See supra text accompanying notes 37-49 (discussing the results of Shafir, Simon- son, and Tversky concerning the idea of "reason-based choice").

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1194 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

quate because in law she has an obligation to frame her claim against

the defendant as an argument, that is, under some sort of conceptual

structure. It will not do for the plaintiff to show only that a majority of

the judges believes (in some unstructured way) that the defendant

owes (or, even, probably owes) her damages for some reason. Instead,

she must show that (more probably than not) a majority of the judges

believes that there is a reason-at least one particular reason, here

woven out of some particular account of transactional wrong-for the

claim. It is in this respect that some claims, even if they are right (or

right more probably than not), may not be right for the right reasons.

We might reasonably wonder, therefore, whether they are both right

and rational.

IV. CATEGORICAL REASON AND RATIONAL CHOICE

The argument so far has shown that there is an alternative con-

ception of ideally rational choice, which I have called categorical rea-

son, that requires us to relax some quite fundamental axioms of the

economic theory of rational choice. If agents choose under an under-

standing of what it is that they are doing, and not merely in a goal- or

value-oriented way, then they will choose differently under different

understandings, the requirements of WARP and the sure thing prin-

ciple notwithstanding. I have called this alternative conception of ra-

tional choice categorical reason because it emphasizes the idea that a

relationship between certain alternatives, or how they are understood

together or as a category, can inform choice. In this respect, categori-

cal reason is to be contrasted with axioms like WARP and the sure

thing principle, which emphasize the independent properties and

values of particular alternatives, and insist on choice consistency so

long as these properties, independently considered (either within a

set of certain alternatives or within a lottery of uncertain outcomes),

remain the same.

Further, the research done by the behaviorists has suggested that,

as a matter of fact, this alternative ideal of rational choice does inform

how agents actually choose. Of course, the particular experiments might still have us wondering how rational it is merely to react (un-

thinkingly) to some of these different understandings of one's choice situation. For example, to choose a higher quality pen over some cash

merely because a lesser quality pen has been added to the set of alter-

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1195

56 natives does not seem to be a particularly rational thing to do on any

plausible account of rationality. However, I have argued that different

scenarios can easily be constructed that make perfect sense of this sort

of behavior and, further, that the practice of common law adjudica- tion, in its traditional emphasis on the obligation to offer a particular

argument in support of one's claim, idealizes a form of categorical reason.

In this Part, I argue that there is some advantage in this alternative

conception of rationality, even for what the economic theorist of ra-

tional choice seeks to accomplish. I focus on two areas of rational

choice theory that have confronted systematic difficulties, namely, the

theory of social choice and the theory of games, to suggest how the

arguments might go. In the theory of social choice I suggest that the

idea of categorical reason can bring some conceptual discipline to

bear on the individual preferences that are deemed admissible into

the social choice rule and that certain problems of instability in social

choice can thereby be avoided. I relate this argument to certain for-

mal results in social choice theory dealing with required restrictions

on the domain of admissible preferences. In the theory of games, I

argue that categorical reason allows a player to conceive of the game

she is playing in a way that makes certain strategy choices less accessi-

ble to her. The result, I suggest, is a greater propensity for players to

coordinate their choices in a coordination game and, more controver-

sially, a greater propensity for them to choose cooperatively in the

prisoner's dilemma game.

A. Categorical Reason and Social Choice

In many situations calling for collective action, it seems likely that

the individual members of a decisive majority will not have reasons in

common for what they most want to do. Yet we will not feel that this is 57

in any way problematic for them. Consider, for example, that most

mundane of economic transactions, the purchase of a car. To give

this problem a collective dimension, imagine that there is a three-

person purchasing consortium and that a majority of the consortium

has voted to buy a white sports car. One member of the majority has

voted this way only because the car is white and the other only because

it is a sports car. Table 2 summarizes this scenario in a way that ap-

56 This choice is discussed supra text accompanying notes 25-26. 5 See, eg., Kornhauser & Sager, Group Choice, supra note 52, at 18-20 (discussing

the different normative premises that might motivate individual members of a group).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1196 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

pears to make it fully analogous to the earlier legal example laid out

in Table 1.

Table 2

1. We should buy 2. We should buy 3. We should buy this car because it this car because it this car because it

is white. is a sports car. ar. car.

Individual A True False True

Individual B False True True

Individual C False False False

Majority False False True

The fact that the members A and B of the majority in column 3 do

not have "reasons in common" to support their shared preference for

buying this particular car is not thought to present them with any real

difficulty. Nor is it thought to be rationally compelling that this pur-

chasing consortium chooses not to buy this white sports car simply be-

cause a majority rejects both the idea of buying it because it is white

and the idea of buying it because it is a sports car. The decision to

purchase a car, even (more particularly) a white sports car, is not es-

sentially decomposable into two prior atomic propositions: Is it a

sports car? Is it white? That underlying structure, while possibly a

helpful guide to the purchasing decision, is not an essential part of

the problem in the same way that the plaintiffs claim to damages in Table 1 needs to be grounded in a particular account of transactional

wrong. Rather, the purchasing consortium is out to purchase a car,

perhaps even the best car that is available to it, all things considered. But

that judgment is ultimately made of the car and on the whole, not on a

criterion-by-criterion (or column-by-column) basis.

Despite this structural difference in the examples, there might be

something useful, even for what the economist seeks to accomplish by way of social choice or what a purchasing consortium seeks to achieve

in the market for cars, in insisting on the greater rationality require-

ment that is inherent in the legal idea that members of a group can

act sensibly together only if they can organize what they would prefer to do under a common understanding, that is, only if they can act to-

gether under a common set of categories or concepts. That this is sometimes difficult to do, and that it sometimes frustrates the

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1197

achievement of shared preferences, might be precisely what is so use-

ful about it.

To illustrate this point, suppose that the three individuals in our

Table 2 purchasing consortium, considering the joint purchase of a

car, originally had preferences over three alternative cars as follows

(where for each individual the alternatives are preferred in order

from top to bottom within each column):

Table 3

Individual A Individual B Individual C

White sports car (WS) Black sports car (BS) Black family car (BF)

Black family car (BF) White sports car (WS) Black sports car (BS)

Black sports car (BS) Black family car (BF) White sports car (WS)

This is, of course, the preference profile that makes for the familiar

majority voting paradox. A majority prefers WS to BF, BF to BS, and

BS to WS. Thus, within the social choice framework, there is the dan-

ger here of a kind of excess of rational doing: for every alternative that

one is tempted to choose, there is another that a majority would pre-

fer to have instead. It is this excess of rational doing that gives rise to

cycling and instability.

Now it is common for economists to point out that the problem

here is that individual preferences are not "single peaked"; there is no

general agreement (1) that all the alternatives are to be assessed ac-

cording to some single decisive dimension, and (2) that one of the al-

ternatives is of intermediate value on that decisive dimension. If only

that were so, the argument goes, then that intermediately placed al-

ternative would never be the worst alternative for any voter and the

majority voting paradox would be avoided 9

For a good introductory discussion of the majority voting paradox, see DENNIS

L. MUELLER, PUBLIC CHOICE II, at 63-66 (1989).

59 Id. at 64-66. If there is this sort of agreement across the voters, and preferences are single peaked, then the alternative chosen under majority rule will be the one

which possesses that amount of the decisive dimension which is most preferred by the median voter-that is, the voter who is in the middle of the distribution of voters or-

dered along the decisive dimension according to where their most preferred alterna- tive is on that decisive dimension. Why this alternative would be chosen, and why no

other alternative would defeat it under majority rule, can easily be appreciated in the

following way: Imagine beginning at the extreme left (or right) of the decisive contin-

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1198 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

This is, in effect, to insist that individuals organize their prefer-

ences in a single-minded way along one decisive dimension and to al-

low them only the limited scope of ordering the social alternatives ac-

cording to how these alternatives vary quantitatively (more or less)

along that decisive dimension.60 But, as the example suggests, and as 1 61

multidimensional models show more generally, individuals react, reasonably, to a broad range of categorically different dimensions or

aspects of the social alternatives on offer. And so the question arises

whether these different and plural dimensions of a social choice prob-

lem can be rationally organized in some way so that instability can be

avoided.

The car example is suggestive. The majority coalition of A and C

can say together (in support of what they might do together), "Given that

the car is black, we would prefer it to be a family car." Likewise, the

majority coalition of B and C might be able to say, "Given that it's a

sports car, we would prefer it to be black." In this respect, these coali-

tions can make use of what are sometimes referred to as generic prefer-

ences.62 But what would the majority coalition A and B say together? In some sense, of course, they have a shared preference over a pair of

very particularly described alternatives just like the other majority coa-

litions do. Indeed, as already intimated, that is what gives rise to the

instability. But their shared preference for WS over BF lacks any of

the generic structure that characterizes the shared preferences of the

other two majority coalitions. Thus, it is harder for them to articulate

their shared preference in any sort of categorical way, that is, in a way

that makes use of the generic preferences that are in play in the

choice problem. In this respect they, as a coalition, are rendered

uum. Then any move to the right (or left) will receive the support of a majority of the

voters until we arrive at the median voter's ideal position on the continuum, at which

point any further move to the right (or left) will be defeated by a majority of the voters.

60 The standard example is the ordering of candidates for political office from "left" to "right" on the ideological spectrum. Another example might be the different

quantities of some uni-dimensional public good that different voters want to buy at a given tax price. For a good discussion of both of these examples, see ALLAN FELDMAN,

WELFARE ECONOMICS AND SOCIAL CHOICE THEORY 169-70 (1980).

See Richard D. McKelvey, Intransitivities in Multidimensional Voting Models and

Some Implications for Agenda Control, 12J. ECON. THEORY 472, 472-82 (1976) (detailing how multidimensional voting can "end up at any other point in the space of alterna-

tives"). For a discussion of the multidimensional case in a legal context, see Chapman,

More Easily Done, supra note 52, at 300-16.

SeeJon Doyle & Richmond H. Thomason, Background to Qualitative Decision The- ory, Al MAG., Summer 1999, at 55, 58 (defining generic preferences as preferences among classes).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1199

"speechless," just like judges A and B were in the Table 1 legal exam-

ple. But now we can see that there may be some stabilizing effect in

using the discipline of a shared (or public) categorical reason to re-

strict the formation of this majority group. After all, without this addi-

tional discipline and structure, there is only a senseless (i.e., noncate-

gorical, nonconceptual) aggregation of (merely particular) pre-

ferences and the cycling problem that this permits.

The discipline that is provided by a (public) categorical reason

can be related more generally to a particular form of "value restric-

tion" (specifically, "not-between value restriction") that Amartya Sen 63

has shown is sufficient for avoiding the majority voting paradox.

Specifically, if all individuals agree that in any triple a given alternative

is "not between" the other two, that is, is either best or worst of the

three, then the majority voting paradox cannot occur. For instance,

in the car example, it is easy to see that an alternative way to express

what A and C have in common is their view that WS is a "not-between"

alternative for them; the real issue between them is whether the pur-

chased car should be a black car (BE, BS) or not (WS). Individual A

puts the white car alternative (WS) first and the pair of black car al-

ternatives (BE, BS) last, whereas individual C has the reverse ordering

of these two partitions. This is something that they could have de-

cided first, before they went on to decide, if necessary, what was a sec-

ondary issue to them, viz., what type of car a black car should be.6'

Likewise, what the coalition of B and C has in common might have

been expressed as an agreement over BF as a "not-between" alterna-

tive, the sort of agreement that asks each to decide first whether the

car chosen should be a sports car or not and, second, if it should be a

sports car, whether it should be black or white. But, again, the pair of

individuals A and B would have some difficulty articulating its own ver-

sion of a common understanding of the relevant issues in this way.

They agree between them that BS is a "not-between" alternative, but

Amartya K. Sen, A Possibility Theorem on Majority Decisions, 34 ECONOMETRICA

491, 492-95 (1966).

64 It could be, of course, that A feels there is a great deal more at stake in the choice of car type than the choice of color, viz., that the preferential distance between

BFand BS is large compared to the preferential distance between WS and BE But this cannot be a view that she has in common with C. For C the preferential distance be- tween BF and BS is contained within the distance between BF and WS. So the search for

a shared (or public) categorical reason for choice, at least one linking A and C, cannot be found here. As the text following this note suggests, this suggested interpretation (that car type is a more important issue than car color) is better for the pair of voters B and C.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1200 UNIVERSITY'OFPFNNSYLVANIA LAWREVIEW [Vol. 151: 1169

what, exactly, is the category or concept that embraces the partition

(WS, BE) of alternatives that is the complement to that not-between

alternative? The problem, again, is that it is hard to "make sense" of

such a partition of the alternatives in terms of the categories or con-

cepts (color and type of car) that are in play in the example. We

might say, as we can for all the other possible pairs of individuals, that

individuals A and B agree at the level of preferences, but that they do

not share any sort of categorical agreement about the sorts of issues

that inform their choice and the order in which these issues might be

considered.

Now one might object that the imposition of a categorical disci-

pline on preferences still leaves too much unresolved to be helpful.

After all, even those two groups of voters, AC and BC, which (unlike

group AB) agree that the salient issues are the type and color of the

car to be purchased, disagree fundamentally on the order in which these two issues should be addressed. For AC the most salient issue is

color; only after considering that issue would this group turn its atten-

tion, if necessary, to what type of car it should be. But for the coali-

tion BC the most important issue is type of car, and only if a sports car

is chosen would the coalition turn its attention to the issue of color.

Moreover, the order in which the issues are considered is likely to af-

fect the outcome; in this respect the matter is analogous to the prob-

lem of path-dependent choice . For example, if color is considered

first, then it seems less likely that BS will end up being chosen. Indi-

65 The choice of an alternative is path-dependent if the probability of that alterna- tive being chosen varies with the order in which it is presented for consideration as

compared to other alternatives. In social choice theory, the conventional view is to

think of path dependence as a kind of arbitrariness to be avoided; alternatives should

be chosen, the argument goes, according to the value of their intrinsic properties. Kenneth Arrow, for example, defended his use of a collective rationality condition in

social choice on the ground that collective rationality, in the form of a fully transitive

social preference relation, would guarantee path independence. KENNETH J. ARROW,

SOCIAL CHOICE AND INDIVIDUAL VALUES 120 (2d ed. 1963); see also Charles R. Plott,

Path Independence, Rationality, and Social Choice, 41 ECONOMETRICA 1075, 1075-91 (1973)

(discussing the relationship between path dependence and collective rationality).

However, not all path dependence should be construed as arbitrary path dependence; some choice sequences, or paths, might make "more sense" than others and will often

matter a great deal to a process theorist. See Bruce Chapman, Individual Rights and Col-

lective Rationality: Some Implications for Economic Analysis of Law, 10 HOFSTRA L. REv. 455, 466-70 (1982) (reconciling path dependence with deontological thought); Chapman, More Easily Done, supra note 52, at 303 (arguing that "some legal choice paths or proc-

esses are so permeated by thought," and so conceptually privileged, that they make choosing on alternative choice paths almost "unthinkable"); Bruce Chapman, Rights as Constraints: Nozick Versus Sen, 15 THEORY & DECISION 1, 2-8 (1983) (discussing the im-

plications of rightful choice partitions for collective rationality).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1201

vidual C will vote in favor of black cars, and individual A against black

cars, in the first round. Whether black cars are chosen categorically in

that round depends a good deal on how individual B, whose prefer- ences are not categorical in this way because they do not satisfy not-

between value restriction on alternative WS, actually votes. But, in the

event of a first round vote for a black car, it does seem likely that BF

will defeat BS in the vote on the issue of type of car. An analogous ar-

gument would suggest that WS is the less likely choice if the issue of

type of car is decided first.

However, in some contexts, there is good reason to think that this

sort of path dependence will be less of a problem for categorically

sensitive choice.66 This is because the categories or concepts that

make sense of certain partitions of the alternatives for choice will often

make sense of certain paths (or sequences of those partitions) as well,

at least if we want to continue to make use of the stabilizing effects of

not-between value restriction. To see this, consider the example of a

criminal trial, where the two issues to be decided are the verdict and

the sentence for the accused. Again, one could imagine a panel of

judges considering three possible final outcomes-innocent (I), guilty

with a severe sentence (GS), and guilty with a lenient sentence (GL).

And again, a natural partition of the alternative outcomes might be

into the two issues, verdict (generating the choice "(I) or (GS, GL)?")

and sentence (generating the choice "GS or GL?"), a partitioning that

would "make sense" in a way that the alternative partitions, "(GS) or

(I, GL)?" or "(GL) or (I, GS)?," would not. (What single concept,

category, or issue sensibly comprehends the partition (I, GS), for ex-

ample?) But, still, it seems that one could take these two issues, and

the partitions to which they lend sense, in order of either "sentence

first, verdict afterwards" or "verdict first, sentence afterwards." The

law adopts the second of the two possibilities (and the Queen at Al-

ice's trial in Wonderland adopts the first),6' but is there any reason to do so? One answer, of course, is simple economy: why bother attend-

ing to the issue of sentencing until we know that the verdict decision

makes it necessary? But the analysis provided here suggests a different

answer. While both sequences respect the partition of the alternatives

that makes the most sense, only the path that has us consider the ver-

See Chapman, supra note 27, at 1507 (arguing that law exemplifies a "categorical application of plural considerations to decisionmaking" by using a "process of adjudi- cation as sequenced argument").

LEWIS CARROLL, ALICE'S ADVENTURES IN WONDERLAND 187 (Univ. Microfilms

1966) (1865).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1202 UNIVERSITY OFPENNSYLVANIA LAWREIVIEW [Vol. 151: 1169

dict first, or the one forcing the initial choice to be over the partitions

"(I) or (GS, GL) ," imposes any sort of not-between value restriction on

the panel of judges. Under the verdict first sequence, each judge

must order her preferences around the salient legal categories, decid-

ing whether to put the alternative I either better or worse than (but

not between) the alternatives GS or GL. The sentence first sequence,

on the other hand, while paying a kind of lip service to the same set of

issues, does not require any of the judges to order her preferences

around those issues. For example, a judge who preferred the three

alternatives in the order GL first, then I, and then GS, that is, someone

who might be saying, "Whether or not I would find him guilty of the

offense depends on the sentence he would receive," would have no

difficulty voting these preferences under the sentence first procedure

even though these preferences do not seem to show a categorical

commitment to the issues that are salient in the case. The verdict first

sequence, on the other hand, does force this judge to ask a more cate-

gorical sort of question about the verdict, that is, to show the same

sort of commitment to the issues in the case as does the law she per- 68

sonifies. Furthermore, under a verdict first procedure, we not only

make sense of the issues in the case, but we also impose a domain re-

striction on the preferences that legal decision makers can bring to

bear on legal decisions so that certain problems of instability are

avoided.

The burden of this Section has been to show that categorical rea-

son can provide a useful sort of conceptual discipline on the kinds of shared individual preferences that should be decisive in social choice.

Certain individuals, who want to do something together, might find

that it is more difficult to act as a decisive coalition in favor of their

shared preferences if they are obliged to think, and talk, about exactly

Requiring this sort of structure can, of course, tempt the judge to "nullify" a possible guilty verdict for fear of risking the worst (for her) possible sentencing out- come GS. Verdict nullification has attracted a good deal of critical comment, particu- larly in the United States where, in jury trials, there is the possibility of the death pen- alty. Juries are said to be charged with the responsibility of reaching a verdict within the law as explained by the trial judge; it is the task of the judge to determine the sen- tence. For members of the jury to worry about the sentence rather than the verdict, particularly if they think the accused has committed the offense in question, is thought by some to violate the rule of law. Whatever the merits of verdict nullification by ju- ries, my analysis here, based on the stabilizing impact of imposing the categorical con- straints of not-between value restriction, offers an independent reason for supporting the verdict first procedure. See generally Darryl K Brown, Jury Nullification Within the Rule of Law, 81 MINN. L. REv. 1149, 1155 (1997) (examiningjury nullification and sug- gesting thatjury nullification can "occur within the rule of law, rather than subvert it").

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CA TEGORJCAL REASON 1203

what it is that they are doing. To the extent that the problems of in-

stability that arise in social choice are explained in large part because

too many decisive coalitions can form too easily, the conceptual disci-

pline that categorical reason provides in this respect could be very

helpful. I have also tried to relate the idea of categorical reason to

some well-known results in the theory of social choice that impose re-

strictions on the domain of individual preferences that can be admit-

ted into social choice if instability is to be avoided. While the latter

results are not in any way new for the economic theory of social

choice, it is novel to motivate these results in, and connect them to,

the more philosophical idea of categorical reason. I now will suggest

that categorical reason can also have a beneficial impact on the possi-

bility of coordination and cooperation in the theory of games.

B. Categorical Reason in Noncooperative Games

Consider the simple two person pure coordination game called

"Heads and Tails."69 Each person, without consulting the other, must

turn up either "Heads" or "Tails" on her own coin. If each person

turns up "Tails"-a match-then each will win five dollars from the

pot. However, if each turns up "Heads"-another match-then each

will win ten dollars from the pot. In the absence of a match, each wins

nothing. What should each person do? What is the rational thing to

do?

Note that there is no conflict of interest in this game. The two

players will receive identical payoffs in all four possible outcomes and,

therefore, order these four outcomes in an identical way." Specifi- cally, they both agree that the outcome generated by each of them

playing "Heads" is best, that the outcome wherein each plays "Tails" is

This game is discussed in Sugden, supra note 32, at 775.

70 Thus, this could be a game in which all the players are act utilitarians: each seeks to act in such a way that total welfare for her society is maximized, but must do so

without the benefit of prior consultation about what she should do to achieve that

shared goal. Such a group has a coordination problem (the inability to communicate

is what makes the game "noncooperative"), even though there is an identity of inter-

ests across the players. See D.H. HODGSON, CONSEQUENCES OF UTILITARIANISM: A

STUDY IN NORMATIVE ETHICS AND LEGAL THEORY 58-62 (1967) (illustrating that even

correct application of act utilitarianism would not necessarily have better conse-

quences, and would possibly have worse consequences, than would acceptance of spe- cific conventional moral rules and personal rules); DONALD REGAN, UTILITARIANISM

AND CO-OPERATION 66 (1980) (analyzing the problem of coordination between act

utilitarians). For a good introductory discussion showing how rational choice theory

implies counterintuitive results in the analysis of coordination games, see Sugden, su-

pra note 32, at 774-78.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1204 UNITVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

second best, and that the two non-matching outcomes, "Heads-Tails"

and "Tails-Heads," are tied for worst. One might have thought that

this would make the choice of actions relatively easy: each player

would choose that action, "Heads," which so clearly, and without con-

flict, makes both players better off.

Surprisingly, however, the choice of this action is less obvious for a

player deemed to be rational in the way that rationality is understood

within game theory. This is because rational play for any one player

depends crucially on what that player thinks the other player will do

in the game. It is simply false, the argument goes, to think that one

should always turn up "Heads." If the other player turns up "Heads,"

then, but only then, should the first player match with "Heads" her-

self. Otherwise, the first player should turn up "Tails" and secure the

second best of the matching outcomes. The problem, of course, is

that both players are thinking through this same problem of strategic

choice at the same time (or, at least, without prior consultation or

revelation of their choices), and so neither can really condition her

choice on the given choice of the other. Moreover, that each player is

rational in this way is typically assumed to be common knowledge in

the game. Thus, each player knows that the other is likewise at-

tempting to work out this conditional strategy which conditions on a

strategy that is itself conditional on the strategy of the first. The result

is an infinite (self-referential) regress that has the effect of leaving

each player in a kind of strategic limbo, unsure about what to do.

Nor do the difficulties disappear if we allow the individual player

to develop a strategy that appears to recognize and confront this proW

lem as one of uncertainty. The mixed (or probabilistic) strategy that

survives the common knowledge assumption requires that each player

play "Heads" with a 1/3 probability and "Tails" with a 2/3 probabil-

ity.72 However, while this allows both players simultaneously to step

Common knowledge is information which is known to all the players in a game,

which each player knows the others know, which each knows the others know that she knows, and so on. Common knowledge of rationality (and of the rules and payoffs of the game) is typically crucial for solving games because it allows players to put them-

selves in the place of other players, to replicate their reasoning (that is, think through what they will rationally do in their situation), and act accordingly. For a discussion of the importance of the common knowledge assumption to game theory, see CRISTINA BICCHIERI, RATIONALITYAND COORDINATION 39-43 (1993); Chapman, supra note 30, at

443-45.

7 This is the Nash equilibrium mixed strategy. "A Nash equilibrium is an array of strategies, one for each plaver, such that no player has an incentive (in terms of im- proving his own payoff) to deviate from his part of the strategy array." DAVID M. KREPS, GAME THEORY AND ECONOMIC MODELLING 28 (1990). Any other assignment of

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CA TEGORJCAL REASON 1205

out of the strategic limbo in which they originally found themselves,

the consequence is hardly comforting. Now, under this choice of a

mixed strategy by each player, the most preferred outcome where

each player matches on "Heads" arises with only a 1/9 probability (the

product of each player independently playing heads with a 1/3 prob-

ability). One might have hoped that rational choice would do better

than that.

The economist Michael Bacharach has characterized the sort of

thinking that generates this difficulty as thinking in an "I/he" frame.73

The "I/he" frame accommodates the idea, central to game theory and

Nash-like thinking, that a player should ask what strategy is best for

herself given what the other player might do, and allows that player,

again under common knowledge of such reasoning, to replicate that

probabilities between the two choices, "Heads" and "Tails," would not be stable as each

of the two players tested out its rationality under common knowledge, an assumption

that allows each to replicate the reasoning of the other and then make corresponding

adjustments in a proposed strategy choice.

For an explanation of how to derive (and interpret) a mixed strategy, see ERIC

RASMUSEN, GAMES AND INFORMATION: AN INTRODUCTION TO GAME THEORY 69-73

(1989). Mixed strategies require an odd interpretation. The idea is to calculate the

probability distribution over one's own possible actions such that the other player will

be indifferent between which strategy she chooses. Thus, in the game "Heads and

Tails," if player 1 chooses to play "Heads" with a 1/3 probability, the expected payoff

for player 2 in playing "Heads" is equal to the expected payoff in playing "Tails,"

namely, 10/3. But given her indifference between playing either of the two pure

strategies (i.e., either "Heads" or "Tails" with certainty) in such circumstances, she

should also be indifferent between playing either of those pure strategies and any

mixed strategy which combines them probabilistically, including her Nash equilibrium strategy that has her playing "Heads" with a 1/3 probability. Thus, we can say, given

that player 1 plays her Nash equilibrium strategy of "Heads with a 1/3 probability,"

player 2 has no incentive to deviate from her Nash equilibrium strategy of "Heads with

a 1/3 probability" since she does no better for herself by so deviating. (The fact that

she also does no worse is a problem for the theory in that it is essentially an equilibrium

theory rather than a theory for how to play the game ab initio; why, of all those strate- gies over which she is indifferent, does she feel any compulsion to play the Nash equi-

librium strategy in particular? For an indication of how one game theorist handles this

problem, see Robert J. Aumann, Correlated Equilibrium as an Expression of Bayesian Ra-

tionality, 55 ECONOMETRICA 1 (1987). Aumann describes a correlated equilibrium ap-

proach that does away with the dichotomy usually perceived between the "Bayesian"

and the "game-theoretic" view of the world by synthesizing the two viewpoints and con-

sequently not requiring explicit randomization on the part of the players. Id. at 1.)

And we can also say all this of player 1 if player 2 chooses to play (her Nash equilib-

rium strategy) "Heads with a 1/3 probability." Thus, the playing of "Heads" with a 1/3

probability by each player is a Nash equilibrium for the game since no player, given the strategy choice by the other player, can improve her own payoff by adopting an alter- native strategy.

Michael Bacharach, "We" Equilibria: A Variable Frame Theory of Cooperation

5 June 24, 1997) (unpublished manuscript, on file with author).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1206 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

same sort of thinking in the other player as well. The other sort of

thinking that Bacharach identifies is thinking in a "we" frame.74 The

"we" frame encourages each player to think about the profile S of strategies (one for each player) that should be adopted by the players

as a group and then identifies the rational strategy for each player as

the one that simply (categorically, nonconditionally) has that player

"doing her part" S, within that overall profile.75 Unlike in the "I/he" frame, a player in the "we" frame does not have to consider whether

the other players are themselves doing their parts as components of

this profile of strategies in order to justify her strategy choice. Rather,

in response to any question about why she was doing what she was do-

ing, she would only say, "This is simply what we do when we do S (as

best) ," or, perhaps (to emphasize how the collective understanding

orders the particularity of her individual choice), "This is simply what

I do when we do S (as best)," or even, most provocatively (because

most categorical in tone), "This is simply what it is for us, you and me,

to do S (as best)."

It should be apparent that Bacharach's "we" frame is closely akin

to the collective understanding that Shafir and Tversky propose as an

explanation for the disjunction effect that they observed in the play of

the prisoner's dilemma game.76 It will be recalled that there was a greater propensity for an experimental subject to cooperate when the

strategy choice of the other player in the game was still uncertain. In

that situation, the outcome of the game still had to be collectively de-

termined by the strategy choices of both players, something that put

each player in a more collective (and, it seems, a more cooperative)

frame of mind. On the other hand, when the strategy of the other

player is given, be it to cooperate or not, then the game becomes one

in which the one remaining player chooses to determine the outcome

of the game, something that provides for a more individualistic frame

of mind. This experiment essentially reproduces the "we" frame and

74 Id.

Robert Sugden's notion of "team reasoning" has a similar structure. See Robert

Sugden, Team Preferences, 16 ECON. & PHIL. 175, 176 (2000) (arguing that "the theory of choice should allow 'teams' of individuals to be decision-making agents and should

allow such teams to have preferences"); Robert Sugden, Thinking as a Team: Towards

an Explanation of Nonselfish Behavior, 10 SOC. PHIL. & PUB. POL'Y 69, 89 (1993) (assert- ing that "reasons for cooperating do indeed exist, but that these reasons can get a grip

only if we conceive of ourselves as members of a team").

See supra text accompanying notes 37-45 (noting that the disjunction effect that occurs depends on whether a player knows if the other player has already chosen her

strategy).

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1207

the "I/he" frame for the subjects, and provides some empirical sup-

port for Bacharach's dualistic account of thinking.

It is important to emphasize that what Bacharach's account pro-

vides for, and what the Shafir-Tversky experiments support, is the idea

of categorical reason, or the notion that it is a different understanding

that informs choice under the "we" frame. It would be a mistake, for

example, to think that the "we" frame only introduces a different,

more collective, sort of motivation, one that merely identifies "doing

one's part" with the (more conditional, less categorical) idea that "I

will cooperate if she does." To begin, the latter idea is not consistent

with what the Shafir-Tversky experiments show; the subjects tended to

be noncooperative almost as frequently when the other player was

known to be cooperating as when the other player was known to be

not cooperating. Second, this sort of conditional cooperation would

do nothing to get the players out of the strategic limbo of the pure

coordination game, a limbo that arises precisely because of an infinite

regress of mutually conditioning conditionals. Third, the idea of do-

ing one's part as (merely) conditional cooperation would have no im-

pact on the play of the prisoner's dilemma game, where, in game the-

ory at least, the player has a dominant (not a conditional) strategy not

to cooperate regardless of what the other player does. Rather, what the

Bacharach account provides, and what the experiments support, is an

idea powerful and categorical enough to take us beyond the problem-

atic regress of the pure coordination game and as far as thinking, at

least presumptively,77 that what the other player does, and what one should do given what the other player does, is not even the right way

to think about strategic choice. The last thought undermines domi-

nance thinking in the prisoner's dilemma as much as it circumvents

the infinite regress of the pure coordination game.

However, now the worry might be that we have ended up with an

account of rational cooperation that is too unconditional, that is, one

that is implausible precisely because it ignores what the other player

might be doing. Indeed, this is what might be suggested by the very

word categorical, and the somewhat Kantian overtones in the phrase

categorical reason. The Kantian, it is often said, cooperates absolutely,

or just because it is right, and without regard to the contingencies of

what others might choose to do. But, however Kantian that might be,

This is an important qualification, already hinted at supra note 7. The idea is to allow coordination and cooperation to get started, not to commit to either absolutely.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1208 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151: 1169

it is a mistaken understanding of what is meant here by categorical in

the phrase "categorical reason." 78

Consider again the earlier etiquette example. That example in-

volved categorical reason because the issue of etiquette was only rele-

vant for those partitions or sets that included the big and small apples

as alternatives for choice. For the other partitions or sets, etiquette

was not relevant at all. In that limited partition-dependent sense, a

sense problematic for WARP, the concern for etiquette was categori-

cal. But it would be a mistake to think that the concern for etiquette

was absolute as compared to, say, the hedonistic interest in eating

larger pieces of fruit. It might be, therefore, that the difference in size

between the large and small apple could become so large that the he-

donistic interest in larger pieces of fruit would overwhelm (even

rightly) the concern for etiquette. In such a situation, with the parti-

tion-dependent effect overwhelmed, there would indeed be transitivity

of preference and no violation of WARP. However, the point of the

example was not to argue that transitivity or WARP never obtain, but

only to suggest that these properties need not always obtain in the way

that rational choice theory suggests. Thus, in this respect, the ex-

treme or uncompromising view is the one offered by rational choice

theory, not the one offered by the theory of categorical reason.

And the same could be said for the theory of cooperation based

on categorical reason. An agent acting under a collective understand-

ing or "we" frame might begin presumptively and categorically with the

thought that she should "do her part" in S because that is what it is for

us, you and me, to do S (as best). But the agent need not think of

herself as absolutely committed to cooperation under strategy S. If too

few others do their part, for example, there may be no "whole" of

which one's own individual choice can sensibly be construed or un-

derstood as a part. This may call for a rational revision of what it is

that one is doing and allow, therefore, for the possibility of not coop-

erating if others are not cooperating as well.79 However, this should

Supra text accompanying notes 27-28.

For a discussion of conditional or presumptive cooperation as a kind of "revis-

able rationality," see Chapman, supra note 30, at 472-76. I have argued elsewhere, Bruce Chapman, Rational Voluntarism and the Charitable Sector, in BETWEEN STATE AND MARKET: ESSAYS ON CHARITIES LAW AND POLICY IN CANADA 127 (Jim Phillips et al. eds.,

2001), that this account of presumptive cooperation provides a better explanation of voluntary contributions to public goods, such as in the relief of poverty through chari-

table contributions, than does the theory of rational choice (never cooperate) or Kan-

tian obligation (always cooperate). Moreover, the presumptive cooperation account

can make more sense of the tax treatment of charitable contributions, and the empiri-

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

2003] CATEGORICAL REASON 1209

not be thought of as resurrecting the idea of a purely conditional co-

operation. A purely conditional cooperation is still too much in the

"I/he" frame, and makes no sense at all of a (prior, albeit only pre-

sumptive) collective understanding of one's action. What categorical

reason rationally requires, therefore, is a defeasible presumption in

favor of cooperation, not an absolute (and thoughtless) commitment

to it.

CONCLUSION

There is a kind of "incompleteness" in the idea of categorical rea-

son that should freely be admitted. An agent who only sees, or under-

stands, alternatives for choice under the aspect of more general con-

cepts, or categories of thought, does not, perhaps, fully appreciate

these alternatives in all their particularity. Any given categorization

need not be crude, of course, but short of reproducing a range of

categories that is as detailed and fine as the particular alternatives it

seeks to organize, it seems inevitable that something must be lost if

choice is to be ordered by categorical reason.80

In rational choice theory, by contrast, the fully rational agent can

compare all possible alternatives for choice. It is true that agents in

the actual world are not thought to be fully rational in this way, but

that is the ideal. Thus, when we say of someone, "She bought the

Volvo because she likes durable cars," in rational choice theory we

mean to concede that she probably approached the problem of

choice as best she could, but also that, ideally, she would not have lim-

ited herself by these broad generalizations and would have compared

(in detail) all the possible alternatives that she might have chosen.

Rough categorizations and broad rules of thumb are only needed be-

cause an agent must make her way through what would otherwise be

an "incomprehensibly large number of alternatives, most of which

represent unimportant variations on each other." 8'

cal evidence on how individuals respond to these different tax incentives, than can ra-

tional choice or Kantian theory. See id. at 130 (outlining the complex motivational structure of homo socioeconomicus).

The incompleteness of choice ordered by categorical reason can easily be ap-

preciated if one reconsiders the criminal trial example, supra text accompanying notes

67-68. While all three alternatives discussed there are available as a final choice, the "verdict first, sentence afterwards" choice process (which makes outcome I the "not-

between" alternative in the triple) does not permit a (sensible) pairwise comparison

(or choice) between alternative I and either alternative GS or alternative GL. This noncomparability of certain pairs of alternatives violates completeness.

Doyle & Thomason, supra note 62, at 61.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms

1210 UNIVERSITY OFPENNSYLVANIA LAWREVIEW [Vol. 151:1 69

For the rational choice theorist, therefore, something of rational-

ity is lost as we move from a fully particular comparison of all possible

alternatives to a comparison constrained by categorization. But there

must be something gained for rationality as well. For what makes a

comparison of all possible alternatives in their full particularity "in-

comprehensible" is not merely that the set of alternatives is "large." It

is also that, without some such categorization, the particularity of

choice would literally be "unthinkable." We think through to the par-

ticulars of our world, after all, only under the aspect of more general

concepts or categories of thought.

So we should not be surprised that there is a notion of ideal ra-

tionality that competes with the full rationality of rational choice the-

ory and pulls us in an opposite direction, that is, from particular to

general rather than from general to particular. However, I hope to

have shown in this Article that the tendency to reduce the general to

the particular, all in the name of a more fully rational choice, contin-

ues to plague rational choice theory. Sometimes this tendency shows

up as the temptation to see alternatives for choice in a partition-

independent way, as if features of the alternatives themselves were all

that mattered for choice and never features shared with other alterna-

tives in the choice set. This is what our discussion of the choice con-

sistency condition WARP revealed. At other times, the propensity for

particularity is manifested in the tendency to reduce what is attractive

in a whole to what is attractive in its parts. But, as we saw in our dis-

cussion of the sure thing principle (or strong independence condi-

tion), our understanding of a choice situation and, therefore, what we

should rationally do under that understanding, varies according to

whether the choice is seen as a whole or as a disjunction of its parts.

These different notions of rationality have been in play in the be-

haviorists' experiments on choice for some years now. But, for the

most part, the results of these experiments have not been organized

under an alternative conception of rational choice. This Article has

tried to suggest that the alternative conception that is required, one

based on categorical reason, is part of a long-standing theoretical tra-

dition, and that rational choice theorists would do well to look to this

tradition to solve some systematic difficulties that they confront in so-

cial choice theory and the theory of games. That law forms part of this tradition of categorical reason suggests further, perhaps, that le-

gal theorists have a special obligation to show them the way.

This content downloaded from ������������73.211.34.7 on Mon, 14 Aug 2023 01:05:46 +00:00�������������

All use subject to https://about.jstor.org/terms