Foundations of Economic Motivation

The statement, 'The first principle of economics is that every agent is actuated only by self-interest,' as articulated in the 1881 work Mathematical Psychics, represented a significant clarification for economic theory. Which of the following best analyzes the primary implication of adopting this principle for economic modeling?

The statement, 'The first principle of economics is that every agent is actuated only by self-interest,' when used as the foundation for an economic model, implies that actions which appear altruistic (like anonymous donations) cannot be rationally explained and must be considered outside the scope of economic analysis.

Match the economic thinker with the statement that best represents their core view on human motivation as a basis for economic analysis.

Explaining Seemingly Altruistic Behavior

The Shift in Economic Thought

Critique of the Self-Interest Principle

The principle that 'every agent is actuated only by self-interest,' a foundational concept for much of modern economic modeling, was formally articulated by ______ in his 1881 work Mathematical Psychics.

Evaluating Policy Through the Lens of Self-Interest

Corporate Decision-Making and Self-Interest