In this paper we revisit the literature on rational choice theory (RCT) and the critical approaches to it. We will present a concise description of the theory as defended by Gary Becker, Richard Posner, and James Coleman (as well as others) at the University of Chicago from the mid-1970s to the early 1990s. We will discuss its epistemological assumptions and predictions and also the most important counter-arguments. We will emphasize the critique based on behavioral economics and will try to see if humans’ supposed cognitive constraints lead to a failure of rationality or if they constitute rational responses to the scarcity of information, time, and energy. In our discussion, we will use findings from experimental economics and the sciences of the brain, especially evolutionary psychology and neuroeconomics. Our intention is to present an improved theory of rational choice that, on the basis of the above discussion, will be more descriptively accurate without losing its predicting power. We will conclude by trying to answer the most important related policy question: when rationality seems to fail, does this necessarily imply that agents should be paternalistically protected from themselves? We will briefly defend the thesis that, in the long-run, it is much better for society at large if individual decision makers are left alone to develop rational responses to their cognitive constraints.