Rational Choice Theory

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Acronym

RCT

Alternate name(s)

N/A

Main dependent construct(s)/factor(s)

Rational Decision

Main independent construct(s)/factor(s)

Cost, Risk, Punishment, Benefits

Originating author(s)

Gary S Becker (1974)

Paternoster and Simpson (1996)

Originating area

Criminology and Law

Level of analysis

Individual, Group

Concise description of theory

The rational choice theory (RCT) suggests that humans are rational beings who make decisions after calculating the perceived costs and benefits associated with their choice[1][2][3]. The choice made by a reasoned actor after weighing the means and ends is called a rational choice. The individuals consider the characteristics of the action individually and respond selectively to their costs, benefits, or risks, which helps them decide whether they should consider the decision or focus elsewhere[4].

RCT aims to maximise the total utility during decision-making. However, it is not easy to measure/observe utility directly. Hence behaviour change due to the choices made is inferred as synonymous with utility[5].

Diagram/schematic of theory

Reasoned actors considering costs, benefits and risks before making a rational decision.

Seminal articles

  • A behavioral approach to the rational choice theory of collective action presidential address, American political science association, 1997 (1998) American Political Science Review, 92 (1), pp. 1-22. Cited 1764 times. DOI: 10.2307/2585925
  • Koremenos, B., Lipson, C., Snidal, D. The rational design of international institutions (2001) International Organization, 55 (4), pp. 761-799. Cited 1168 times. DOI: 10.1162/00208180-1317193592
  • Lerner, J.S., Li, Y., Valdesolo, P., Kassam, K.S. Emotion and decision making (2015) Annual Review of Psychology, 66, pp. 799-823. Cited 990 times. DOI: 10.1146/annurev-psych-010213-115043
  • Schwartz, B. Self-determination: The tyranny of freedom (2000) American Psychologist, 55 (1), pp. 79-88. Cited 471 times. DOI: 10.1037/0003-066X.55.1.79
  • Sherkat, D.E., Ellison, C.G. Recent developments and current controversies in the sociology of religion (1999) Annual Review of Sociology, 25, pp. 363-394. Cited 446 times.  DOI: 10.1146/annurev.soc.25.1.363
  • Cornish, D.B., Clarke, R.V. Understanding crime displacement: an application of rational choice theory (1987) Criminology, 25 (4), pp. 933-948. Cited 434 times. DOI: 10.1111/j.1745-9125.1987.tb00826.x
  • Guzman, A. How International Law Works: A Rational Choice Theory (2008) How International Law Works: A Rational Choice Theory, pp. 1-304. Cited 432 times. DOI: 10.1093/acprof:oso/9780195305562.001.0001
  • Ammerman, N.T. Everyday Religion: Observing Modern Religious Lives (2007) Everyday Religion: Observing Modern Religious Lives, pp. 1-272. Cited 407 times. DOI: 10.1093/acprof:oso/9780195305418.001.0001

Key References Outside IS Research Area

  • G. Becker, “Essays in the Economics of Crime and Punishment,” National Bureau of Economic Research, pp. 1-54, 1974.
  • R. Paternoster and S. Simpson, “Sanction Threats and Appeals to Morality: Testing a Rational Choice Model of Corporate Crime,” Law & Society Review, vol. 3, no. 3, pp. 549-584, 1996.
  • Diekmann, A., Preisendörfer, P. Green and greenback: The behavioral effects of environmental attitudes in low-cost and high-cost situations (2003) Rationality and Society, 15 (4), pp. 441-472. Cited 379 times. DOI: 10.1177/1043463103154002
  • Diani, M., McAdam, D. Social Movements and Networks: Relational Approaches to Collective Action (2003) Social Movements and Networks: Relational Approaches to Collective Action, pp. 1-368. Cited 349 times. DOI: 10.1093/0199251789.001.0001
  • Hechter, M., Kanazawa, S. Sociological rational choice theory (1997) Annual Review of Sociology, 23, pp. 191-214. Cited 349 times.  DOI: 10.1146/annurev.soc.23.1.191
  • Bardsley, N. Dictator game giving: Altruism or artefact? (2008) Experimental Economics, 11 (2), pp. 122-133. Cited 325 times. DOI: 10.1007/s10683-007-9172-2
  • Paternoster, R. How much do we really know about criminal deterrence? (2010) Journal of Criminal Law and Criminology, 100 (3), pp. 765-824. Cited 312 times.
  • Haug, S. Migration networks and migration decision-making (2008) Journal of Ethnic and Migration Studies, 34 (4), pp. 585-605. Cited 309 times.  DOI: 10.1080/13691830801961605
  • Rothstein, B. Trust, social dilemmas and collective memories (2000) Journal of Theoretical Politics, 12 (4), pp. 477-501. Cited 295 times. DOI: 10.1177/0951692800012004007
  • Goemans, H.E. War and punishment: The causes of war termination and the First World War (2012) War and Punishment: The Causes of War Termination and the First World War, pp. 1-355. Cited 292 times.
  • Feiock, R.C. Rational choice and regional governance (2007) Journal of Urban Affairs, 29 (1), pp. 47-63. Cited 290 times. DOI: 10.1111/j.1467-9906.2007.00322.x
  • Sherkat, D.E., Wilson, J. Preferences, constraints, and choices in religious markets: An examination of religious switching and apostasy (1995) Social Forces, 73 (3), pp. 993-1026. Cited 289 times. DOI: 10.1093/sf/73.3.993
  • Biel, A., Thøgersen, J. Activation of social norms in social dilemmas: A review of the evidence and reflections on the implications for environmental behaviour (2007) Journal of Economic Psychology, 28 (1), pp. 93-112. Cited 285 times. DOI: 10.1016/j.joep.2006.03.003
  • Rankin, K.N. Social capital, microfinance, and the politics of development (2002) Feminist Economics, 8 (1), pp. 1-24. Cited 271 times. DOI: 10.1080/13545700210125167

IS articles that use the theory

RCT was introduced as an application in the criminology and law domain. However, it has also been used in IS research, especially in the information security domain.

  • [Moody et al., 2018] conducted a comprehensive review of 11 theories in the IS domain to develop a unified model of Information System Security (ISS). They used intention as a prediction behavior and tried to understand the role of punishment in cases of non-compliance to security policies.
  • To understand the compliance of information security policy (ISP), [Chen et al., 2016] defined motivation using RCT.
  • To account for the positive and the negative impact of the rational choice made by any actor, [D’Arcy and Herath, 2011] conducted a literature review. They used theories in information system security to understand all the disparate findings.
  • The effects of cognitive factors on morals and their influence on ISP compliance have been discussed by [D’Arcy and Lowry, 2019].
  • [Li et al., 2017] explained the intention behind making positive and negative choices in internet use policy (IUP) compliance.
Cited works:
  • [Chen et al., 2016] Chen, X., Chen, L., and Wu, D. (2016). Factors that influence employees’ security policy compliance: An awareness-motivation capability perspective. Journal of Computer Information Systems, 58:1–13.
  • [D’Arcy and Herath, 2011] D’Arcy, J. and Herath, T. (2011). A review and analysis of deterrence theory in the is security literature: Making sense of the disparate findings. EJIS, 20:643–658.
  • [D’Arcy and Lowry, 2019] D’Arcy, J. and Lowry, P. (2019). Cognitive affective drivers of employees’ daily compliance with information security policies: A multilevel, longitudinal study. Information Systems Journal, 29:43–69.
  • [Li et al., 2017] Li, H., Luo, R., Zhang, J., and Sarathy, R. (2017). Self-control, organizational context, and rational choice in internet abuses at work. Information Management.
  • [Moody et al., 2018] Moody, G., Siponen, M., and Pahnila, S. (2018). Toward a unified model of information security policy compliance. MIS Quarterly, 42:285–311

Links from this theory to other theories

General Deterrence Theory General deterrence theory

External Links

Wikipedia page for Rational Choice Theory https://en.wikipedia.org/wiki/Rational_choice_theory

Wikipedia page for Rational Choice Theory (Criminology) https://en.wikipedia.org/wiki/Rational_choice_theory_(criminology)

References

  1. ↑ G. Becker, “Essays in the Economics of Crime and Punishment,” National Bureau of Economic Research, pp. 1-54, 1974.
  2. ↑ R. Paternoster, “How Much Do We Really Know about Criminal Deterrence,” Journal of Criminal Law and Criminology, vol. 100, no. 3, pp. 765-823, 2010.
  3. ↑ R. Paternoster and S. Simpson, “Sanction Threats and Appeals to Morality: Testing a Rational Choice Model of Corporate Crime,” Law & Society Review, vol. 3, no. 3, pp. 549-584, 1996.
  4. ↑ D. Cornish and R. Clarke, “Understanding Crime Displacement: An Application Of Rational Choice Theory,” Criminology, vol. 25, No. 4, pp. 933-948, 1987.
  5. ↑ R. Herrnstein, “Rational Choice Theory Necessary but Not Sufficient,” American Psycologist, vol. 45, no. 3, pp. 356-367, 1990.

Contributor

Soumya Mudgal, Doctoral Student at Indian Institute of Management, Kozhikode, India

Date last updated

21/08/2022 Please feel free to make modifications to this site. In order to do so, you must register.

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