X-Nico

2 unusual facts about Social welfare function


Social welfare function

The object was "to state in precise form the value judgments required for the derivation of the conditions of maximum economic welfare" set out by earlier writers, including Marshall and Pigou, Pareto and Barone, and Lerner.

Abram Bergson (Burk),"A Reformulation of Certain Aspects of Welfare Economics," Quarterly Journal of Economics, 52(2), February 1938, 310-34


Welfare cost of business cycles

One way to calculate how costly this greater volatility is in terms of individual (or, under some restrictive conditions, social) welfare is to ask what percentage of her annual average consumption would an individual be willing to sacrifice in order to eliminate this volatility entirely.


see also

Arrow's impossibility theorem

; Unrestricted domain: (or universality) For any set of individual voter preferences, the social welfare function should yield a unique and complete ranking of societal choices.