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The news of the death of welfare economics is greatly exaggerated

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  • Marc Fleurbaey
  • Philippe Mongin

Abstract

The paper reexamines the controversy about Bergson-Samuelson social welfare functions (BSF) that took place between welfare economists and social choice theorists as a consequence of Arrow's impossibility theorem. The 1970's witnessed a new version of the theorem that was meant to establish that BSF "make interpersonal comparisons of utility or are dictatorial''. Against this, Samuelson reasserted the existence of well-behaved "ordinalist'' BSF and generally denied the relevance of Arrovian impossibilities to welfare economics. The paper formalizes and reassesses each camp's arguments. While being also critical of Samuelson's, it eventually endorses his conclusion that welfare economics was left untouched by the controversy. It draws some connections of BSF with contemporary normative economics.
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  • Marc Fleurbaey & Philippe Mongin, 2005. "The news of the death of welfare economics is greatly exaggerated," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 25(2), pages 381-418, December.
    • Handle: RePEc:spr:sochwe:v:25:y:2005:i:2:p:381-418
    DOI: 10.1007/s00355-005-0010-1
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