Whither Welfare Economics?

Abstract

Welfare economics, particularly in its present Paretian form, has become the last refuge of an unrealistic general-equilibrium approach and a reverential attitude towards the market system. These preoccupations have resulted in a set of basic assumptions and ethical premises which have prevented a systematic consideration of some of the most important contemporary economic conflicts such as those between ‘economic growth’ (somehow defined) and egalitarian distribution of incomes, material prosperity and conservation of environment, individuals’ private preferences and social priorities, consumers’ rights and the freedom for producers to promote sales of their products, and so on.