The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Utilitarianism and Economic Theory

  • Jonathan Riley
Reference work entry


Utilitarianism is a family of moral and political philosophies according to which general utility or social welfare is ultimately the sole ethical value or good to be maximized. Normative economics endorsed a hedonistic version of utilitarianism from the latter part of the 18th century well into the 20th century. Despite the ordinalist revolution, some version of utilitarianism continues implicitly to serve as the ethical basis for economic policy judgements. While there are signs that this may be changing, economic theory has not yet moved decisively beyond utilitarianism, nor is it clear that it should.


Abundance Bargaining Bentham, J. Binmore, K. Cardinal utility Checks and balances Classical economics Consequentialism Contract curve Contractualism Distributive justice Edgeworth, F. Y. Enlightened self-interest Equality Ethical pluralism Harsanyi, J. C. Hedonistic utilitarianism Helvetius, C. A. Hume, D. Individuality Interpersonal utility comparisons Jevons, W. S. Leximin Liberal democracy Majority rule Marshall, A. Maximin Mill, J. S. Mirrlees, J. Moore, G. E. Natural justice Naturalistic fallacy Normative economics Optimal taxation Ordinal utility Outcome utilitarianism Proportional bargaining Rational choice utilitarianism Rawls, J. Representative democracy Revealed preference theory Security Sen, A. Sidgwick, H. Social contract Spencer, H. Subsistence Utilitarianism Utilitarianism and economic theory Utility Value Veil of ignorance Von Neumann and Morgenstern Welfarism 

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© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Jonathan Riley
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