Oracles and Economic Behavior Fernando Tohm´ e Departamento de Econom´ ıa - UNS CONICET Argentina e-mail: ftohme@criba.edu.ar Abstract In this brief paper we show that some of the limitations of economic theory, particularly those related to the computability of those entities that reflect the results of rational deliberations by economic agents, may be solved by means of tools drawn from the theory of recursive functions. We claim that assuming the existence of oracles providing additional in- sights about the context in which agents make decisions, we overcome many of the drawbacks in the computational characterization of both in- dividual and aggregate equilibria. This alternative framework conveys some intuitions about how agents behave when solving problems, which could make possible to incorporate behavioral assumptions into the more traditional theoretical constructs in economics. 1 Introduction In this paper we will examine what we see as some limitations of economic theory. We will focus particularly on those predicted outcomes that seem to require extraordinary abilities of the economic agents to reach them. This is clear in the case of the computational requirements for the solutions to both individual and collective decision-making problems [Mirowski 2002]. On the other hand, the approach followed here is intended to be an answer to the program of Alain Lewis, who argued that economic theories should be formulated in an effective framework [Lewis 1985],[Lewis 1990],[Lewis 1991],[Lewis 1992]. That is, that every entity or property defined in them should be computable. In section 2 we will present what we see as the central problems in economics. One of those problems, related with the existence of individual choice functions, is discussed in section 3. The aggregate problem of the existence of an economic equilibrium is discussed in section 4. The computational limitations in both cases is solved by means of oracles that amplify the power of Turing machines. The implications of this are briefly discussed in section 5. 1