In order to provide greater coordination between our two noble disciplines --
economics and political science -- and preserve the integrity of our notion of
rational choice, I would like to offer the following comments based upon the
recent dialogue between John C. Campbell and Margaret McKean.

>Date: Tue, 12 Sep 1995
>From: "John C. Campbell"

>It is just the same as simple economic supply and demand models, or
maybe ahair more complex since those can say that both buyers and sellers want
to maximize since money. My sense is that once we look at more than one
preference for a class of individuals--much less let each individual have his
own--that of the models get too complicated to be of much use. Of course they
are more realistic, but we can't use them for anything.

>Date: Wed, 13 Sep 95
>From: "Margaret McKean"

>McKean replies: Yep. That's absolutely right. Our research problem may well
goad us into assuming uniform preferences across a class of individuals. This
can still be useful though.

What I am about to say is not new to this discussion board, but I do hope that I
can state it a little more clearly than some of my immediate predecessors have
done.

The supply and demand curves which we estimate in economics are aggregated
values. In the case of supply they are aggregated across firms, and in the case
of demand they are aggregated across consumers. In neither case however do we
make the assumption that all firms or all consumers are identical. In fact I can
think of only one instance in economics where we make the assumption of a
representative agent (the kind of agents to which Profs. Campbell and McKean
have alluded in which all individuals of a single group are assumed to share an
identical set of preferences). It occurs in international trade theory when we
construct the social indifference curve for an entire nation. Moreover, because
it is absurd to assume that all individuals share identical preferences in the
market place, many economists discount the utility of trade theory as an
empirical tool. Notwithstanding, this body of theory has provided us with a
strong framework for discussing international trade problems. I suspect that the
application of representative agents in political science is similar -- very
theoretical with little or no empirical basis (Steven Reed).

And now to set the record straight for us, economists, and help you political
scientists to understand how fundamentally different we are in our approximation
of the empirical reality which we seek to describe. To be both relevant and
brief I will restrict my discussion to demand theory, and simply state that
supply theory uses a similar methodological construct.

In general we do not assume that any two individuals are alike. With the
exception of trade theory each consumer is assumed to enter in to the market
place with his own unique utility function from which (as someone before me has
already stated) the individual's demand function is derived. What my predecessor
did not say however, and what I wish to stress here, is that the demand function
which we typically estimate in the market place is not that of a single
individual, rather the aggregate demand function for all individuals. In other
words, although we work empirically in the aggregate, in theory we begin with
the individual.

This does not mean that we do not claim that we can predict individual behavior,
because we do. Simply, we make the claim with could empirical evidence that in
the aggregate the irrationality of our fellow humans -- i.e., stochastic noise,
washes out.

What seems to make our modelling so attractive to the political scientist is the
agent approach (cat aspect) with which we describe human behavior. It might be
that in the political arena, popular opinion is so uniform (monkey aspect) among
different social classes or political groups that your assumptions of
representative agents can withstand empirical rigour. I beg of you, however, not
to assume in general that we are measuring with similar degrees of precision.
We, economists, as far as I can tell are empirically much closer to reality than
you political scientists.

We start with the assumption that everyone is different, and you start with the
assumption that everyone is the same. We are playing in different leagues.

Hashimori Iwato