Economic rationalism is an Australian term in macroeconomics, applicable to the economic policy of many governments around the world, in particular during the 1980s.
In the USA the near equivalent terminology was supply-side economics.
The origins of the term are unclear however it is likely that they relate to the works of the English philosopher John Stuart Mill (1806-1873) and his treatise on economic thought and the contrast between Rationalism and Romantacism.
To a large extent the term merely means economic liberalism.
Economic rationalism can have positive results when the 'self-interest' is considered as the financial wellbeing of society at large. This financial wellbeing may however be at the expense of environmental and cultural considerations. Economic rationalist policy is often opposed by environmentalists, multiculturalists and others at the opposite end of the political spectrum to economic rationalists themselves.
Criticism Of
Economic rationalism is economic policy without social moral consideration, or "the view that commercial activity ... represents a sphere of activity in which moral considerations, beyond the rule of business probity dictated by enlightened self-interest, have no role to play." (Quiggin 1997)
As Margaret Thatcher famously said, "There is no such thing as society. There are individuals, and there are families."
See also
Reference
- Economic rationalism, John Quiggin, Professor of Economics, James Cook University, Published as: Quiggin, J. (1997), 'Economic rationalism', Crossings, 2(1), 3-12.
- http://www.publicbookshelf.com/public_html/Outline_of_Great_Books_Volume_I/economicr_cca.html