The Validity of Rational Choice Theory - Case Study Example

The Validity of Rational Choice Theory Institution: Name: Table of Contents Table of Contents 1 Abstract 3 Introduction 3 Background of the Study 4 Significance of the Study 5 Literature review 5 Underlying Theory 7 Applying Rational Choice Theory in offender’s risk analysis 7 Issues on validity of Rational Choice Theory 10 Discussion: Implications of lack of validity of RCT 13 Conclusion 14 References 15 Abstract Although the theory has found extensive application within the security risk management context since the 1970s, recent assumptions have questioned its validity. This paper seeks to ascertain the validity of the theory, by examining whether an offender’s preferences depend on his individual perception of benefits and risk. It also examines whether an offender’s decisions to offend are influenced by his materialistic, psychological social, cultural and emotional interests during the assessment of risks and benefits. It is concluded that the validity of Rational Choice Theory remains in doubt since an offender’s preferences depend on his individual perception of benefits and risk. Additionally, while an offender may also focus on the materialistic interests during the assessment of risks and benefits, a range of other interests such as psychological social, cultural and emotional interests also influence his decision. The Validity of Rational Choice Theory Introduction Rational Choice Theory hypothesises that an offender’s appraisal of risks and benefits of committing a crime determine his decision to offend (Li &Cheng, 2013). According to Piquero (2012), the theory has substantiated punishments, sanctions and physical security as critical instruments that deter aberrant behaviour. However, several empirical studies have postulated that an individual will make decisions on whether to offend depending on the array of inputs, namely the potential payoff, efforts required, extent of peer support and the risk of apprehension and punishment in addition to the individual needs. These recent assumptions have questioned the validity of Rational Choice Theory. Based on this analysis, to ascertain the validity of the Rational Choice Theory, the objective of this paper seeks to: Determine whether an offender’s preferences depend on his individual perception of benefits and risk. Determine whether an offender’s decisions to offend are influenced by his materialistic, psychological social, cultural and emotional interests during the assessment of risks and benefits. Background of the Study Anchored in utilitarian philosophy as the deterrence principle, rational theory was introduced into the field of criminology by economists. The basis of the theory depends on the expected utility model proposed by economic theory, which argues that people tend to make rational decisions depending on the degree to which they anticipate the benefits and the risks of loss. Hence, the rational relies on the traditional deterrence model by combining the perceived benefits and rewards of the act, with the perceived risks of being caught. Historically, the origin of the theory goes back to 1920s. Max Weber (1920) built a typology action around concepts that denote human actions, whether rational or irrational (Scott, 2000). His ideas were adopted to Talcott Parsons (1937) and integrated into the sociological mainstream. Bronislaw Malinowski (1922), a social anthropologist, also examined how social exchange could be integrated into the social obligation structures. Some researchers have argued that the theory developed as part of behavioural revolution in 1950s and 1960s. In 1961, George Homans established rational choice theory in sociology, grounded on behaviourist psychology (Ogu, 2013). Homan’s perspectives have remained the basis of subsequent discussions on rational choice theory. A number of other scholars, namely Blau (1964), Coleman (1973), and Cook (1977) expanded Homan’s framework in a range of disciplines, such as economics and mathematics (Scott, 2000). The theory was popularised by 1992 Nobel Memorial Prize Laureate in Economics Science, Gary Becker (1976), when he stated that when humans are faced with several courses of actions, they tend to do what is likely to present the best result.” Several empirical studies have examined rational choice theory. However, its validity has not been sufficiently assessed. Significance of the Study The study will contribute to the existing literature by warning against the risks of assuming rationality when considering the behaviours of potential offenders as it fails to consider the irrational behaviours of the actors. By ascertaining the validity of Rational Choice Theory, the study also seeks to expand on the strategies for improving security measures and institutional capacity to deter and prevent crime. Literature review Seyman’s (2013) study presented an analysis of offenders’ decisions-making process during the commission of a crime to establish the possible policy implications for policymakers, managers and law enforcement. The researchers used document analysis research method in their study to analyse past studies that had examined offenders’ decision-making processes based on rational choice theory. Seyman (2013) established that the decisions made by an offender when committing a crime are based on his expected efforts and rewards on one hand and the risk of being caught as well as the severity of the punishment. Despite Seyman’s (2013) positive findings, several studies have presented contradictory results. Trott (2013) examined the extent to which prospect and rational choice theory contribute to the understanding of the causes and implications of conflicts in Africa. The researcher used document analysis in his research to explain how Rational Choice Theory is insufficient in exploring human behaviour in regards to responding to security sanctions. Trott (2013) found that the Rational Choice Theory is simplistic and tends to overlook human cognitive functioning. On the other hand, Prospect Theory contributed to the understanding of the behaviours of actions and the causes of perpetuation of wars within the African context (Trott, 2013). To this end, it is contended that the validity of Rational Choice Theory remains in doubt. In a related study, Hu et al. (2011) examined whether deterrence can reduce information security policy abuses among employees. The researchers examined the potential of security policy abuse based on Rational Choice Theory and Prospect Theory. Hu et al. (2011) concluded that while they could not claim that they had established why deterrence is effective in reducing security risks, they could attest to the fact that while the Rational Choice Theory of deviant behaviour is extensively supported by past empirical studies, the perceived benefits of offending surpasses the perceived risks in an offender’s risk calculus. Hence, it can be reasoned that the deterrence antecedents are less effective than the moral and self-control belief antecedents in determining the decisions of an individual. Hu’s et al. (2011) findings are consistent with findings by Sokolowska (2006) who used risk-value (R-V) models to determine whether risk perception and risk acceptance play a role in determining an offender’s decision. In a study of 305 university students, risk was treated as primitive and tested whether independent of the offender’s aspirations of benefits and preferences depended on aspirations. The study found that the ordering of risks is not susceptible to changes in anticipations of benefits or aspirations. Rather, the preferences are susceptible to those changes (Sokolowska, 2006). Based on the survey of literature, it can be argued that, the empirical studies aimed at establishing the validity of rational choice theory served to indicate the inadequacy of the theory. Hence, the effectiveness of rational choice theory in crime prevention and deterrence is yet to be validated. Underlying Theory Applying Rational Choice Theory in offender’s risk analysis On this analysis, two deterrence dimensions that determine an offender’s decisions are perceived: Perceived detection and perceived severity of sanction are discussed to determine the validity of the theory. By severity, it means that an individual is of the belief that his criminal behaviour will be punished relentlessly (consequences). On the other hand, certainty depicts the probability (or likelihood) of being caught ((Li &Cheng, 2013: Bulgurcu et al. (2010). In an effort to protect a system against attacks, a range of security measures can be taken. Bulgurcu et al. (2010) suggested three types of security measures: prevention, detection and recovery measures. Therefore, crime deterrence and prevention methods can be understood in terms of theories of situational crime prevention (Ward, Stafford & Gray, 2013). The purpose is to reduce risk factors inherent in different types of situations, locations and crimes. As pointed out by Wagner (2009), the primary issues in situations crime prevention is acknowledging that crime reflects the risks, the efforts and the payoff, as appraised by the potential offender. The theory of situational crime is anchored in the theoretical assumption of rational choice (Hayward, 2007). Rational theory hypothesises that an individual will make decisions on whether to offend depending on the array of inputs, namely the potential payoff, efforts required, extent of peer support and the risk of apprehension and punishment, in addition to the individual needs (Pradiptyo, 2007). Indeed, decision-making process is a critical step in selecting between presented alternatives. Ogu (2013) pointed out that decision-making is the process where alternative course of action are selected in a manner that is consistent with the demands of the situation. According to Ogu (2013), the process entails substantive rationality or procedural rationality. Procedural rationality refers to rational decision-making process while substantive rationality describes the possible outcomes of the decisions made based on an individual’s objectives or best interest. The Rational Choice Theory presents a methodology for assessing decision-making through application of evidence to understand choice and decision. Hence, it rationalises the reasoning and conclusions made (Hollman, 2013). The methodology is made up of systematic evaluation of the options using an assessment of the implications of the judgments made, including rationality, validity, risk aversion and value assessment (Oppenheimer, 2008). Tibbetts and Gibson (2011) defined rational choice theory as a neo-classical economic measure that provides theoretical explanation on how potential offenders make choices on whether to offend or not -- by weighing the anticipated benefits from the offense and the risks of getting caught or the severity punishment. Li and Cheng (2013) shows that the theory hypothesises that assessment of risk and benefit of an offender’s options determine his decision to offend. Rational choice theory has been extensively applied to the study of social, individual, economic and criminal behaviours within many contexts. For instance, Siegel (2012) applied the theory in his approach to crime and asserted that a potential offender maximises his anticipated benefits from an illegal act in excess of the anticipation risks of being caught and punished. According to Paternoster and Pogarsky (2009), in a typical rational decision-making, a person first recognises the alternative actions and then considers the likely consequences of each course of actions. To this end, while the consequences are the states of reality after an action has been undertaken, an action can lead to varied consequences. According to Bulgurcu et al. (2010), because individuals tend to have preferences for the consequences, each consequence can be perceived as related to the risk of benefit basing on the level of anticipated satisfaction the outcome can bring to an individual. Therefore, the overall assessment of the risks and benefits that come to an individual from an undertaken action are determined by the individual’s perception of potential outcomes related to the selected course of action. According to Bulgurcu et al. (2010), the significance of rationale choice of security measures can be equated to the estimation of risks. In order to protect a system against attacks, a range of security measures can be taken. Bulgurcu et al. (2010) suggested three types of security measures: prevention, detection and recovery measures. Prevention measures include the security measures aimed at reducing the success of probability of attacks and to increase the risk of attacks. These include the physical access control mechanisms. Detection measures include the security measures designed for detecting the offences. Recovery measures include the measures for re-establishing the normal functionality of the system after a breach. Issues on validity of Rational Choice Theory While rational choice theory has been extensively perceived as a useful approach to explaining behaviours within many contents, confusions have resulted about its key premises, predictions and concepts (Bulgurcu et al. 2010). Hence, the question of its validity emerges. Hu et al. (2011) presented his reservations about the validity of Rational Choice Theory, arguing that although the approach has popularly been used in criminology literature, it has often been used alongside other theoretical frameworks. According to Hu et al. (2011), since humans are only capable of bounded rationality, it is logical to claim that a range of situational and individual factors will condition rational decision-making. According to Li and Cheng (2013), a rational process makes sure that a conclusion is rationally consistent with personal judgemental inputs, probability theory and utility measurements. Paternoster and Simpson (1996) posited that the rational choice theory of crime is basically “subjective expected theory” with two key assumptions: decisions by an individual to commit a crime are based on his assessment of the risk of being caught and the anticipated benefit from the offence. In their view, the critical components within this calculus are the subjective or perceived expectations of the risks and the benefits by the offender (Paternoster & Simpson, 1996). To this end, it is reasoned that the cognitive attributes of the offender and the particular attributes of the situations affects the perceived risks and benefits. Tibbetts and Gibson (2011) elaborated that studies with estimates of individual propensities and the rational choice measures indicate that conceivable variables from the risks and benefits substantially influence an offender’s behaviour, despite the fact that factors from alternative theoretical perspectives are restrained. If Tibbetts and Gibson’s (2011) perspective are to be taken, then it is perceivable that the treatment of moral beliefs, individual propensities and perceived deterrence are the main antecedents to the rational choice approach and are debatable, although primarily anchored in the findings of criminological studies that propose the application of rational choice theory as the basis of offender behaviour. It is therefore submitted that when an individual is presented with an opportunity to offend, his behaviour is reliant on the rational calculus of the risks and the benefits. In contrast, Hu et al. (2011) submitted that the mechanisms of risk and benefit assessment are also influenced by three independent forces, one external and two internal to the individual. Hu et al. (2011) explained that the two internal forces consist of the individual propensity, described as the level of low self-control in addition to an individual’s moral beliefs, which consists of his moral judgments on what is right or wrong. The external force consists of the perceived deterrence that relates to the offence, which describes the perceived severity, certainty and celerity of sanctions against the misconduct (Geiger, 2005). Put differently, they consist of the physical security measures put to deter and prevent crime. It is therefore argued that moral beliefs, deterrence and low self-control are antecedents of the rational choice approach in place of moderators, as suggested by Paternoster and Simpson (1996). This is since these factors are more likely to change an individual’s process of perceiving the risks and benefits rather than solely how the risks and benefits are weighed in an individual’s decision calculus. This point of view receives support from Hu’s et al. (2011), who illustrated that an individual who has strong moral beliefs is more likely to underestimate the benefits. At the same time, he is likely to overestimate the risks of an offence. Correspondingly, a person with low self-control who seeks instantaneous excitement or thrill is more likely to overestimate the benefits while simultaneously overestimating the risks associated with committing an offence (Buldas et al., 2013). According to Tibbetts (2011), while studies on rational choice have showed that formal or officials sanctions such as physical security tend to affect a potential offender’s decisions to offend, they are almost often relatively insignificant compared to informal or extralegal factors. The scholars argued that the effect of individual's perception on the risks of loss of self-esteem or shame, despite not having being caught, is a more significant variable that determines whether or not they would commit an offence. Additional, evidences suggest that gender also plays a factor. As pointed out by Tibbetts (2011), females are more likely to be influenced by the effects of moral beliefs or shame to this respect than their male counterparts. Recent studies have indicated that the degrees of personality traits, particularly low self-control or empathy rationalise why females and males differ when it comes to engaging in criminal acts. Therefore, since an individual’s preferences depend on his individual perception of benefits and risk, the risks and benefits of the courses of actions are subjective and reflect the preference structure of an individual. Hence, a decision that is based on his assessment of benefits and risks are in harmony with his preferences, and therefore rational. Additionally, while an individual may focus on the materialistic interests during the assessment of risks and benefits, a range of interests such as psychological social, cultural and emotional interests may also be regarded. According to Bulgurcu et al. (2010), RCT also fails to explain the expressive offences that happen in a “spur” or the “heat of the moment.” Bulgurcu et al. (2010) cited McCarthy (2002) who argued that jealousy, hatred, anger as well as a range of other emotional forces influence a potential offender’s assessment of benefits and risks of detection. It is therefore argued that emotional states are not independent of the preferences while the appraisal of the risks and benefits in the “spur” of the moment may be distinctly vary compared to those made in different times. Indeed, rational choice theory argues that behaviour is based on such an assessment. Discussion: Implications of lack of validity of RCT From the above analyses, it becomes clear that Rational Choice Theory includes a broad array and complex set of concepts -- including psychological factors, demographic variations and beliefs factors -- that make it difficult to assess the validity of the theory in security risk situation. Thus far, with the assistance of empirical studies on rational choice theory, it is perceived that the theory offers a highly plausible explanation for decision-making processes of certain criminals. Security and criminal justice policymakers are bound to examine future longitudinal researches to better establish the validity of the theory. It is further reasoned out that framing the theory in terms of rational process has the potential to misguide policymakers and security personnel since an effective rational and reasoning does not select the superlative choice. Rather, the best choice selects its superlative rational. It is further reckoned that by pointing to the fact that the validity of Rational Choice Theory remains in doubt, organisations can get to understand employee security behaviour to help reduce the risks of policy violations. It is also established that potential offenders with low self-control, specifically those who tend to be more concerned about themselves than other, are more interested in what happens in the heat of the moment. In addition, they are more risk taking than risk averse, hence are likely to overestimate the benefits of the criminal activity. On the other hand, employees with strong moral beliefs on what is right and wrong are less inclined to violate security policies when opportunities are presented. It is believed that this kind of direction has not been presented before and therefore could have a substantial impact on security management practices. Conclusion To conclude, it is ascertained that the validity of Rational Choice Theory remains in doubt. This is since an offender’s preferences depend on his individual perception of benefits and risk. Therefore, the risks and benefits of the courses of actions tend to be subjective and to reflect the preference structure of an individual. Additionally, while an offender may also focus on the materialistic interests during the assessment of risks and benefits, a range of other interests such as psychological social, cultural and emotional interests also influence his decision. Therefore a need for further empirical researches to explore the validity of the theory within the context of security risk management is necessary. References Buldas, A., Laud, P., Priisalu, J., Saarepera, M. & Willemson, J. (2013). Rational Choice of Security Measures via Multi-Parameter Attack Trees . Retrieved: Bulgurcu, B., Cavusoglu, H., & Benbasat, I. (2010). Information Security Policy Compliance: An Empirical Study of Rationality-Based Beliefs and Information Security Awareness. 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