|
Social Choice Function
In welfare economics and social choice theory, a social welfare function—also called a social ordering, ranking, utility, or choice function—is a function that ranks a set of social states by their desirability. Each person's preferences are combined in some way to determine which outcome is considered better by society as a whole. It can be seen as mathematically formalizing Rousseau's idea of a general will. Social choice functions are studied by economists as a way to identify socially-optimal decisions, giving a procedure to rigorously define which of two outcomes should be considered better for society as a whole (e.g. to compare two different possible income distributions). They are also used by democratic governments to choose between several options in elections, based on the preferences of voters; in this context, a social choice function is typically referred to as an electoral system. The notion of social utility is analogous to the notion of a utility fun ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Welfare Economics
Welfare economics is a field of economics that applies microeconomic techniques to evaluate the overall well-being (welfare) of a society. The principles of welfare economics are often used to inform public economics, which focuses on the ways in which government intervention can improve social welfare. Additionally, welfare economics serves as the theoretical foundation for several instruments of public economics, such as cost–benefit analysis. The intersection of welfare economics and behavioral economics has given rise to the subfield of behavioral welfare economics. Two fundamental theorems are associated with welfare economics. The first states that competitive markets, under certain assumptions, lead to Pareto efficient outcomes. This idea is sometimes referred to as Adam Smith's invisible hand. The second theorem states that with further restrictions, any Pareto efficient outcome can be achieved through a competitive market equilibrium, provided that a social ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Rational Choice Theory
Rational choice modeling refers to the use of decision theory (the theory of rational choice) as a set of guidelines to help understand economic and social behavior. The theory tries to approximate, predict, or mathematically model human behavior by analyzing the behavior of a rational actor facing the same costs and benefits.Gary Browning, Abigail Halcli, Frank Webster (2000). ''Understanding Contemporary Society: Theories of the Present'', London: Sage Publications. Rational choice models are most closely associated with economics, where mathematical analysis of behavior is standard. However, they are widely used throughout the social sciences, and are commonly applied to cognitive science, criminology, political science, and sociology. Overview The basic premise of rational choice theory is that the decisions made by individual actors will collectively produce aggregate social behaviour. The theory also assumes that individuals have preferences out of available choice ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Law Of Diminishing Marginal Utility
Marginal utility, in mainstream economics, describes the change in ''utility'' (pleasure or satisfaction resulting from the consumption) of one unit of a good or service. Marginal utility can be positive, negative, or zero. Negative marginal utility implies that every consumed additional unit of a commodity causes more harm than good, leading to a decrease in overall utility. In contrast, positive marginal utility indicates that every additional unit consumed increases overall utility. In the context of cardinal utility, liberal economists postulate a law of diminishing marginal utility. This law states that the first unit of consumption of a good or service yields more satisfaction or utility than the subsequent units, and there is a continuing reduction in satisfaction or utility for greater amounts. As consumption increases, the additional satisfaction or utility gained from each additional unit consumed falls, a concept known as ''diminishing marginal utility.'' This idea is u ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Jeremy Bentham
Jeremy Bentham (; 4 February Dual dating, 1747/8 Old Style and New Style dates, O.S. [15 February 1748 Old Style and New Style dates, N.S.] – 6 June 1832) was an English philosopher, jurist, and social reformer regarded as the founder of modern utilitarianism. Bentham defined as the "fundamental axiom" of his philosophy the principle that "it is the greatest happiness of the greatest number that is the measure of right and wrong." He became a leading theorist in Anglo-Americans, Anglo-American philosophy of law, and a political radical whose ideas influenced the development of welfarism. He advocated Individualism, individual and economic freedoms, the separation of church and state, freedom of expression, equal rights for women, the right to divorce, and (in an unpublished essay) the decriminalizing of homosexual acts. He called for the abolitionism, abolition of slavery, capital punishment#Abolition of capital punishment, capital punishment, and physical punishment, includ ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Utilitarianism
In ethical philosophy, utilitarianism is a family of normative ethical theories that prescribe actions that maximize happiness and well-being for the affected individuals. In other words, utilitarian ideas encourage actions that lead to the greatest good for the greatest number. Although different varieties of utilitarianism admit different characterizations, the basic idea that underpins them all is, in some sense, to maximize utility, which is often defined in terms of well-being or related concepts. For instance, Jeremy Bentham, the founder of utilitarianism, described ''utility'' as the capacity of actions or objects to produce benefits, such as pleasure, happiness, and good, or to prevent harm, such as pain and unhappiness, to those affected. Utilitarianism is a version of consequentialism, which states that the consequences of any action are the only standard of right and wrong. Unlike other forms of consequentialism, such as egoism and altruism, egalitarian util ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Cardinal Utility
In economics, a cardinal utility expresses not only which of two outcomes is preferred, but also the intensity of preferences, i.e. ''how much'' better or worse one outcome is compared to another. In consumer choice theory, economists originally attempted to replace cardinal utility with the apparently weaker concept of ordinal utility. Cardinal utility appears to impose the assumption that levels of absolute satisfaction exist, so magnitudes of increments to satisfaction can be compared across different situations. However, economists in the 1940s proved that under mild conditions, ordinal utilities imply cardinal utilities. This result is now known as the von Neumann–Morgenstern utility theorem; many similar utility representation theorems exist in other contexts. History In 1738, Daniel Bernoulli was the first to theorize about the marginal value of money. He assumed that the value of an additional amount is inversely proportional to the pecuniary possessions which a per ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Factors Of Production
In economics, factors of production, resources, or inputs are what is used in the production process to produce output—that is, goods and services. The utilised amounts of the various inputs determine the quantity of output according to the relationship called the production function. There are four ''basic'' resources or factors of production: land, labour, capital and entrepreneur (or enterprise). The factors are also frequently labeled "producer goods or services" to distinguish them from the goods or services purchased by consumers, which are frequently labeled "consumer goods". There are two types of factors: ''primary'' and ''secondary''. The previously mentioned primary factors are land, labour and capital. Materials and energy are considered secondary factors in classical economics because they are obtained from land, labour, and capital. The primary factors facilitate production but neither become part of the product (as with raw materials) nor become significantly tran ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Differentiable Function
In mathematics, a differentiable function of one real variable is a function whose derivative exists at each point in its domain. In other words, the graph of a differentiable function has a non- vertical tangent line at each interior point in its domain. A differentiable function is smooth (the function is locally well approximated as a linear function at each interior point) and does not contain any break, angle, or cusp. If is an interior point in the domain of a function , then is said to be ''differentiable at'' if the derivative f'(x_0) exists. In other words, the graph of has a non-vertical tangent line at the point . is said to be differentiable on if it is differentiable at every point of . is said to be ''continuously differentiable'' if its derivative is also a continuous function over the domain of the function f. Generally speaking, is said to be of class if its first k derivatives f^(x), f^(x), \ldots, f^(x) exist and are continuous over the domain of t ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Abram Bergson
Abram Bergson (born Abram Burk, April 21, 1914, in Baltimore, Maryland – April 23, 2003, in Cambridge, Massachusetts) was an American economist, academician, and professor in the Harvard Economics Department since 1956. Early life and education He graduated with an A.B. degree from Johns Hopkins University in 1933 and his A.M. and Ph.D. from Harvard University in 1935 and 1940, respectively.Gewirtz, Ken."Abram Bergson Dies at 89" ''The Harvard Gazette'', May 2, 2003. Career In a 1938 paper Bergson defined and discussed the notion of an individualistic social welfare function. The paper delineated necessary marginal conditions for Pareto efficiency, economic efficiency, relative to: * real-valued Indifference curve, ordinal utility functions of individuals (illustrated by consumer theory, indifference-curve maps) for commodities * labor supplied * other resource constraints. In so doing, it showed how welfare economics could dispense with interpersonally-comparable card ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
