People are not irrational-at least not as much as we are led to believe. This is because the brain is economic. That is, brains have a limited amount of energy to achieve necessary goals like survival and reproduction. As a result, brains have evolved ways to make decisions in an efficient way. Professor Richard McKenzie at UC Irvine and I call this “rational rationality” (for more details, see McKenzie’s forthcoming book In Search of a Defense of Rational Behavior in Economics).
The thing that interests me is that economists still cling to this notion of rationality. The notion of homo economicus is a hard one to kill despite the mounting evidence of irrational decision making that pervades our thinking.
Compare the notion of the rational decision maker with this article on Deadly Mind Traps