Introduction

Abstract

The present study builds on an earlier work (Baxter, 1988) which examined how psychological and sociological concepts contributed to a better understanding of economic behaviour, in particular in the fields of consumer behaviour and labour market behaviour. An interesting feature of the earlier analysis was the manner in which the common behavioural foundations helped to cement links between the different fields of study. In economics, the common links are provided by the basic assumption of ‘rational’ behaviour, as exemplified by utility maximisation and profit maximisation. It is increasingly being recognised, however, that these basic axioms have to be supplemented if economics is to extend its analysis into new fields. But the question arises that, if we are continually having to supplement the basic axioms, would it not be preferable to take the matter to its logical conclusion and adopt much broader behavioural foundations? Such an alternative approach becomes increasingly attractive if it can be demonstrated that these broader foundations would still permit the development of meaningful hypotheses for empirical testing, and even offer scope for the rigorous mathematical analysis which is now such a feature of economics.