----------------- HES POSTING ----------------- Mat Forstater's point that the original meaning of "utility" for many of the classical economists was simply the dictionary meaning, which is "usefulness." Of course this raises the question of "useful for what?" OTOH, Bentham already predated the later more clearly subjective "ophelimity" view of Pareto and Fisher that utility is "pleasure." I think the remark made in another post (sorry, I forget by whom) about Kahneman's recent remark is useful ("utilitarian"?). There may be a serious contradiction between pleasure and utility, however defined. The problem may be one of time perspective and relates to the question of measuring utility as well. Thus, I have noted two current approaches that seem to be going on that could be labeled as efforts to measure utility, indeed a form of cardinal utility arguably. One is the neuroeconomics approach of McCabe, Zak and others that uses magnetic resonance imaging (very little of this has appeared yet in economics journals, with the key original paper in 2001 by McCabe, Houser, Ryan, Smith, and Trouard being in the Proceedings of the US National Academy of Sciences, with much of the rest of it in neurology journals such as Neuron). This can get at the momentary pleasure sort of thing. Someone who smokes crack will show up about ten minutes later with the pleasure centers of their brains buzzing away brightly, although they are likely to be not feeling so pleased an hour later. Or to follow the McCabe et al stuff, someone thinking about cooperating with others will fire neurons in the prefontal cortex more than someone who is thinking about shafting their co- game players. The other is the approach of the happiness studies, which have been around for several decades, with such economists as Richard Easterlin leading the way on these (see the recent volume he has edited for Edward Elgar on _Happiness in Economics_ for a collection of key papers). These depend on answers to these survey questions along the lines of "are you happy?" or "are you satisfied?" Presumably this deals more with the long term sort of satisfaction that Kahneman was referring to, and is probably more like what we think "rational agents" ought to be striving for rather than short term pleasure that can lead to long term unhappiness. Of course relative to MRI, these surveys are very blunt instruments and certainly open to many problems, especially when cross-cultural comparisons are made, as is increasingly being done in a lot of literature. However, some stylized facts at least appear to hold from the accumulating pile of data from these surveys, which have been done for several decades in some countries. Thus, as Easterlin first argued some time ago from the first such time series available (Japan), in a cross section within a given society, richer people tend to be happier/more satisfied than poorer people, but over time rising incomes within a society do not generally lead to rising happiness/satisfaction. Whether or not this happiness/satisfaction is really what we mean, or wish to mean, by "utility" obviously remains an open question. Barkley Rosser ------------ FOOTER TO HES POSTING ------------ For information, send the message "info HES" to [log in to unmask]