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Arrovian Aggregation in Economic Environments: How Much Should We Know About Indifference Surfaces?

  • Fleurbaey, Marc
  • Suzumura, Kotaro
  • Tadenuma, Koichi

Arrow's celebrated theorem of social choice shows that the aggregation of individual preferences into a social ordering cannot make the ranking of any pair of alternatives depend only on individual preferences over that pair, unless the fundamental weak Pareto and nondictatorship principles are violated. In the standard model of division of commodities, we investigate how much information about indifference hypersurfaces is needed to construct social ordering functions satisfying the weak Pareto principle and anonymity. We show that local information such as marginal rates of substitution or the shapes "within the Edgeworth box" is not enough, and knowledge of substantially non-local information is necessary.

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Paper provided by Graduate School of Economics, Hitotsubashi University in its series Discussion Papers with number 2002-10.

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Length: 31 p.
Date of creation: Nov 2002
Date of revision:
Handle: RePEc:hit:econdp:2002-10
Note: November 2002 (First version: July 2001)
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  1. CHICHILNISKYÂ , Graciela, 1995. "A Unified Perspective on Resource Allocation : Limited Arbitrage is Necessary and Sufficient for the Existence of a Competitive Equilibrium, the Core and Social Choice," CORE Discussion Papers 1995027, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. repec:ema:worpap:2000-17 is not listed on IDEAS
  3. Bordes, Georges & Breton, Michel Le, 1989. "Arrovian theorems with private alternatives domains and selfish individuals," Journal of Economic Theory, Elsevier, vol. 47(2), pages 257-281, April.
  4. M. Fleurbaey & F. Maniquet, 2008. "Fair social orderings," Economic Theory, Springer, vol. 34(1), pages 25-45, January.
  5. d'Aspremont, Claude & Gevers, Louis, 1977. "Equity and the Informational Basis of Collective Choice," Review of Economic Studies, Wiley Blackwell, vol. 44(2), pages 199-209, June.
  6. Dirk Van de gaer & Marc Fleurbaey & Walter Bossert, 1999. "Responsibility, talent, and compensation: A second-best analysis," Review of Economic Design, Springer, vol. 4(1), pages 35-55.
  7. Kenneth J. Arrow, 1950. "A Difficulty in the Concept of Social Welfare," Journal of Political Economy, University of Chicago Press, vol. 58, pages 328.
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