Rationalizing predictably irrational choices: the social capital synthesis

Abstract

This paper presents a synthesis of the main characteristics of neoclassical, behavioral, and socioeconomic models. The main characteristics of this synthesis is that it includes social capital-produced relational goods whose value and meaning depend on their connections to people. We contrast relational goods with commodities. Then, we examine whether the synthesis can resolve some of the sometimes conflicting explanations and predictions of economic exchange models. Finally, we apply the synthesis to rural development and find it provides useful explanations and recommendations.