Community Indifference Curves

Abstract

The idea of a community indifference curve, as the term is commonly used, is due to Scitovsky (1942). The genesis of the idea is the fact that comparative statics and welfare analysis in economic models is simplified considerably if there is a social preference ordering over aggregate commodity bundles which reflects the collective individual preferences of agents. Scitovksy’s notion of a ‘community indifference curve’ essentially allows the analytical convenience of social indifference curves, in certain circumstances, without having to assume a specific Bergson–Samuelson social welfare function or having to assume the restrictive assumptions on agents’ preferences needed to guarantee that agents act collectively as a single individual.