Rational Decision Versus Irrational Decision

Making right decisions-at the time when people are facing immense conse-quential choices-has been extremely important. How can we be sure not to make fatal mistakes? The aim of this paper is to reveal some important developments in decision making that have been taking place not only in economics but in other social sciences during the past decades, as well as to offer insight in some new discovers that have occurred. There are many questions related to decision making and behaving in the new, uncertain and dangerous environment. One of the most interesting question is-will our action be rational or irrational? Irrational behavior can be understood as a study of the transition process by which people decide for one's own choice. Naturally, this choice can result in defects, economic losses, and sometimes personal flaws such as bad choice of medicines or poor choice of economic policy. According to traditional assumption of the classic economic theory, the individuals are behaving in rational way and they make rational decisions. Furthermore , irrational behavior is not just isolated to a few 'irrational individu-als" but can become the dominant choice for most people in the entire society. Irrational behavior happens when people make choices and decisions that go against the assumption of rational utility-maximizing behavior. Thus, economists and policymakers must consider the potential for irrationality.