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" "The problem of interpersonal comparison of utilities seems to bother economists more than philosophers. As already indicated, utility or satisfaction or any other similar concept appears in economic theory as an explanation of individual behavior, for example, as a consumer. Specifically, it is hypothesized that the individual chooses his consumption so as to maximize his utility, subject to the constraints imposed by his budget. But, for this purpose, a quantitatively measurable utility is a superfluous concept. All that is needed is an ordering, that is, a statement for each pair of consumption patterns as to which is preferred.
Kenneth Joseph Arrow (August 23, 1921 – February 21, 2017) was an American economist, who was Professor Emeritus of Economics in Stanford, and joint winner of the Nobel Memorial Prize in Economics with John Hicks in 1972.
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The idealist doctrine then may be summed up by saying that each individual has two orderings, one which governs him in his everyday actions, and one which would be relevant under some ideal conditions and which is in some sense truer than the first ordering. It is the latter which is considered relevant to social choice, and it is assumed that there is complete unanimity with regard to the truer individual ordering.
Information, one of the fundamental determinants of production, laps over from one firm to another, yet the firm has so far seemed reasonably sharply defined in terms of legal ownership. It seems to me there must be increasing tensions between legal relations and fundamental economic determinants. Small symptoms are already appearing in the legal and economic spheres. There is continual difficulty in defining intellectual property. The United States courts, at least, have come up with some strange definitions of property.
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Traditional welfare economics shows that there are certain of these combinations that will be preferred by all the voters, which permits us to eliminate the others without too much discussion. However, there will always remain an irreducible kernel of possibilities among which the choice rests on a combination or aggregation of individual ethical attitudes about distribution.