Rational-choice theory is pervasive in legal theorizing. Most law and economics work assumes that human beings make decisions that are rational as to both their ends and means. Decisions are ends-rational if they are directed at goals that satisfy the person's utility function; decisions are means-rational if they adopt methods reasonably connected to achieving those goals. Institutionalist theory assumes that institutions are composed of actors pursuing their own rational ends by rational means and, further, that those institutions themselves can be said to have rational ends pursued by rational means. Most rational-choice theorizing in law is positive: Thinkers are using the theory as a stylized way of describing patterns of behavior or predicting expected behavior. Such theorizing can also be normative: Rationality of ends and means is an aspiration of human and institutional actors, and law can improve upon existing behavior through rules, procedures, and structures.

In contrast to logical criteria of rationality, which can be assessed entirely by reference to the system of preferences, substantive criteria of rational choice refer to an independent evaluation of the outcomes of decisions. One of these substantive criteria is the experienced hedonic utility of outcomes. Research indicates that people are myopic in their decisions, may lack skill in predicting their future tastes, and can be led to erroneous choices by fallible memory and incorrect evaluation of past experiences. Theoretical and practical implications of these challenges to the assumption of economic rationality are discussed.

Let us take, as a starting assumption, the Benthamic understanding of the point of law: We should make laws that will increase the overall happiness of the people whose lives are affected by them. But how should we go about doing that? And more particularly, what role, if any, should our held desires play in the task of ascertaining the content of our happiness? And when, if ever, should we defer to the desires of the affected masses, and when should we not, in determining what will or will not promote happiness? The classical, or “hedonic,” utilitarians of the eighteenth and nineteenth centuries suggested a number of answers to these related questions, of which I will mention two.

At least since the French moralists—Montaigne, Pascal, La Rochefoucauld, La Bruyère—it has been a commonplace that people can fool themselves as well as others about their beliefs and motivations. In this article, I consider some mechanisms of transmutation (deceiving oneself) and misrepresentation (deceiving others), and their impact on behavior. (I refer to these collectively as transformations.) I argue that deception and self-deception are not merely ex post rationalizations of behavior whose real motive and explanation are found elsewhere, but that they have independent causal and explanatory power. If people, that is, did not fool themselves or others about why they do what they do they would act differently. The reason is that deception and self-deception take place under constraints that prevent us from offering totally opportunistic or self-serving rationalizations of what we do. There is a consistency constraint that is induced by the costs of being seen (by oneself or others) as offering inconsistent justifications for one's behavior, and an imperfection constraint diat is induced by the costs of being seen (by oneself or others) as offering justifications that are too blatantly self-serving.

Jon Elster's subtle and richly illustrated argument raises more avenues of inquiry and application than one could possibly explore in a short comment. I will therefore confine myself to addressing three interrelated questions:

First, can the distinctions among interest, passion, and reason on which his analysis depends really be maintained?

Second, what implications does his work hold for some republican and liberal theories that insist on a public sphere purged of interest and passion or that defend a private sphere providing the space necessary to indulge interest and passion?

Finally, what does his analysis tell us about the possibility of a meta-theory that would mediate among interest, passion, and reason?

With regard to the first question, Elster's own argument suggests that the boundaries among interest, passion, and reason are at least permeable. Each motive masquerades as the other or becomes transmuted into the other. Moreover, once one takes the consistency and imperfection constraints into account, the external manifestations of the different motives will often be identical. A positivist, who believes that all that matters are external manifestations that can be measured or observed, might therefore hold that the distinctions Elster analyzes are ones that are hardly worth worrying about.

There is a close but largely unexplored connection between law and economics and cognitive psychology. Law and economics applies economic models, modes of analysis, and argument to legal problems. Economic theory can be applied to legal problems for predictive, explanatory, or evaluative purposes. In explaining or assessing human action, economic theory presupposes a largely unarticulated account of rational, intentional action. Philosophers typically analyze intentional action in terms of desires and beliefs. I intend to perform some action because I believe that it will (is likely to) produce an outcome that I desire. This standard “belief-desire” model of action invokes what philosophers of psychology and action theorists aptly refer to as a “folk psychology.”

According to Jules Coleman, Rational Choice (RC) Theory holds that human action is both intentional and rational. “The rationality of intentional action is evaluated along the two dimensions corresponding to the two elements of the belief-desire model.” On the belief-dimension, RC Theory assumes that people are “able to draw appropriate inferences from the information (or truths) they possess.”