Book contents
- Frontmatter
- Contents
- List of figures
- Dedication
- Introduction
- Part I Introduction, structure, and strategy
- 1 Rationality and utility theory
- 2 Demand and consumer choice
- 3 The theory of the firm and general equilibrium
- 4 Equilibrium theory and economic welfare
- 5 Models and theories in economics
- 6 The structure and strategy of economics
- 7 Overlapping generations: a case study
- Part II Theory assessment
- Part III Conclusion
- Appendix: An introduction to philosophy of science
- Bibliography
- Index
4 - Equilibrium theory and economic welfare
Published online by Cambridge University Press: 04 August 2010
- Frontmatter
- Contents
- List of figures
- Dedication
- Introduction
- Part I Introduction, structure, and strategy
- 1 Rationality and utility theory
- 2 Demand and consumer choice
- 3 The theory of the firm and general equilibrium
- 4 Equilibrium theory and economic welfare
- 5 Models and theories in economics
- 6 The structure and strategy of economics
- 7 Overlapping generations: a case study
- Part II Theory assessment
- Part III Conclusion
- Appendix: An introduction to philosophy of science
- Bibliography
- Index
Summary
One's “welfare” is one's good or well-being. Economic welfare is that portion of the good or well-being of an individual that depends upon the goods and services with which economists are particularly concerned. The problems of economic welfare are multifarious. A broad social consensus supports providing minimum amounts of food, housing, medical care, and education to everyone. The highly inegalitarian distribution of income and other benefits in the United States seems unfair to some (liberals), while others (conservatives) may regard it as morally acceptable, or, like Robert Nozick (1974), they may insist that one should assess the processes that give rise to the distribution of benefits, not the distribution itself. Yet, in practice, conservatives would have trouble defending the actual distribution of benefits in this way, and Nozick does not do so. For it is difficult to believe that it could have arisen from a (fair) process that respected individual rights. As Lester Thurow has remarked (1980, pp. 201–2; 1975, chapter 3), the overall distribution of income in the United States is much more unequal than the distribution of income among fully employed white males, and it is hard to see how the contingencies that might legitimately give rise to income inequalities should cluster in women and Afro-Americans. And the distribution of wealth is even more unequal.
Although economists are important figures in debates concerning both the aims of welfare policies and, especially, the best means of implementing them, such issues largely disappear once one enters in to the realm of theoretical welfare economics.
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- The Inexact and Separate Science of Economics , pp. 57 - 69Publisher: Cambridge University PressPrint publication year: 1992