Ethics, Social Choice Theory and the Theory of Economic Policy

Abstract

This essay is intended as an expository paper on how the seemingly abstract social choice models are related to the practical problems of formulating models of economic policy. The flexibility of the social choice models in dealing with the problem of relating ethical propositions to propositions concerning social actions is not widely understood. The arguments found in the literature are frequently somewhat mathematical and authors seldom attempt to relate their results, or even the reasons for their research, to the underlying problems and motivations as they see them. In fact, however, as will be argued here, social choice models provide a natural framework for the evaluation and construction of economic policy. Most results can be directly interpreted in terms of policy consequences. Let me make clear at the outset, however, that this paper is not a summary of the arguments of several authors. The interpretations given here vary considerably from the interpretations offered by those who first developed some of the ideas.