Choice Theories

Topics: Ponzi scheme, Bernard Madoff, Rational choice theory Pages: 1 (323 words) Published: December 13, 2012
Robin Wake
Choice Theories
Madoff was a master thief and financier. In 2008, he revealed that the asset management arm of his firm, Bernard L. Madoff Investment Securities, was "just one big lie". In what he described as a Ponzi scheme, he took his investors for $65 billion over the course of two decades. The scheme wasn't revealed until Madoff himself confessed his crimes (How Ponzi Schemes Work). I believe this is based on the rational choice theory. For example, a drug addict may know there are thousands rotting in prison for what they’re about to do, but they will get high anyway. It’s the same for a thief, a rapist, and pedophile. An offender’s wants or needs are in the present, the consequences are no more than an afterthought. “What’s the payoff” and “what are the chances of getting away with it” (Madoff sentence misses the point). Madoff obviously knew what he was doing was bad, but kept his “business” going for more than 20 years. Another example that shows rational theory is Madoff's investment empire spent decades taking money from clients on the promise of large returns that he knew they weren’t going to get. Instead of investing the money, he used deposits from new clients to pay out false profits to existing investors (The Guardian). A choice theory I can personally relate to is general deterrence. I got pulled over today in Hampton. I was going ten mph over the speed limit because my daughter was hungry and crying. I rather speed a little bit so I can get home sooner to feed my daughter. I would never excessively speed with my daughter, but if the speed limit is twenty-five and I’m going thirty-five, at that time, getting home outweighed going the speed limit. I wasn’t thinking about the consequence at the time, but ten minutes later, I got handed an eighty dollar ticket.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Essay about The Rational Choice Theory
  • Rational Choice theory Essay
  • Rational Choice Theory Essay
  • Rational Choice Theory and Structural Functionalism: a Supplementation and Assimilation Essay
  • 理性選擇理論(Rational Choice Theory) Essay
  • Albert Bandura Theory Essay
  • Theories of Crime Causation Essay
  • The rational choice approach Essay

Become a StudyMode Member

Sign Up - It's Free