| on History and Philosophy of Economics |
| By: | Chatterjee, Sidharta |
| Abstract: | In this paper, I discuss about the axiomatic basis of rational choice theory—the theory that is behind making rational choice and decisions. To make rational choices, we would require thinking rationally and understanding the reason and logic behind what makes a choice rational, and how we need to choose rationally. Decisions are made under various circumstances, i.e., under risk, and often under compulsion. In social choice theory, decisions are made by different types of decision making entities, i.e., committees, groups, individuals and collective judgments by various types of organizations, etc. This paper highlights these issues and addresses the fundamental tenets of making rational choices by examining and following the previous workings of experts on this field. As such, it introduces a novel concept and the idea of Social Choice Rationality in choosing what’s rational. |
| Keywords: | Choice, decision making, rational choice, social choice theory, Social Choice Rationality, Social welfare, welfare actions |
| JEL: | I3 Z1 |
| Date: | 2022–07–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113880&r= |
| By: | Fernando Esteve Mora (UAM); Rafael Muñoz De Bustillo Llorente |
| Abstract: | The aim of this paper is to present a novel proposal to define social classes from the economic perspective. This paper draws on a previous working paper (Muñoz de Bustillo and Esteve, 2022) that discusses the demise of the concept of social classes in economic analysis derived from the triumph of Neoclassical Theory, its substitution in recent times by the definition of social classes based on ad-hoc aggregation of deciles of people in the income distribution, and the convenience to explore new ways of defining social classes from an economic perspective. The proposal presented in this paper regarding social classes is based on two different elements. The first one is the participation or exclusion of a given person from the economic surplus. The second one is its position, both in terms of income and consumption, in relation to the necessary consumption, C*, and average income, Y. These concepts allow defining three different social classes: Low, Middle and High, that can be further divided in subclasses up to a total of seven. A second, and less developed part of the paper reviews the role of economic power in explaining the allocation of different people in the above-mentioned social classes. |
| Keywords: | Social classes, Classical political economy, Surplus approach |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:dclass:202206&r= |
| By: | Foellmi, Reto; Baselgia, Enea |
| Abstract: | What is the relationship between inequality and growth? This question has occupied and fascinated social scientists for more than a century. This chapter critically reviews the recent empirical and theoretical literature on the complex interplay between inequality and economic growth. Inequality might come in many forms: (top) incomes, wages, wealth, land or opportunities. At the same time, growth performance could be measured as average growth rates, variability of growth or the potential for growth to "take off". This survey considers causality running from inequality to growth; hence, the Kuznets hypothesis is only touched on in passing. The empirical literature estimating the effect of inequality on growth has produced a wide range of results, precluding clear-cut conclusions on the inequality-growth relationship. Consequently, it remains central to understand the underlying economic causes and channels through which (different aspects of) inequality can promote or hamper economic growth. This chapter aims to provide a broad overview of the contemporary results and an outline for prospective empirical and theoretical work. |
| Keywords: | Economic Growth, Inequality, Redistribution, Theory and Evidence |
| JEL: | D30 O10 O31 O40 |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:usg:econwp:2022:05&r= |
| the School of Economics and Finance of Massey University in New Zealand. |