We evolved to be relationally rational

From Rationality in Markets Is Cognitively Unnatural by Jag Bhalla.

We evolved to be relationally rational. We productively resist certain transactional gains.

Bhalla's insight:

Since before we were human, the logic of our survival has been social and relational. It was maladaptive to ignore the impact of our actions on others, or how they were seen, or their long-term effects. This equipped us with a relational rationality that included not just self-only and not only short-term factors.

Prioritizing fairness and reputation—both needed for the cooperation we depend on— over immediate gain, has likely been key to our survival for 10,000 generations. It still is. Definitions of self-interested rationality that exclude this truth, risk becoming self-undermining. Isn’t that truly irrational? Human self-interest has always had social constraints. Reputations, such as an exploiter or being exploitable, matter. As Othello says “Who steals my purse steals trash; ’tis…nothing…But he that filches from me my good name…makes me poor indeed”

Rationality is a matter of goals which vary by context and definition.